RLIS Premium Increase Stretched to 2027

People say the need to increase the premium is about wellbeing Across cultures and civilizations, one value remains constant: the dignity with which societies bid farewell to their dead. In Bhutan too, honoring the departed is not merely ritual, it is an expression of compassion, family, community, and spirituality. But for many Bhutanese families today, grief is increasingly accompanied by a growing financial burden. Funeral-related expenses have risen steadily, while government support under the Rural Life Insurance Scheme (RLIS) has remained unchanged for years. For decades, the RLIS payout has stood at Nu 30,000, a figure widely viewed as insufficient in the face of current realities. “This amount is not even enough to cover the transportation of a body from the hospital to the cremation ground today,” says Goembo Dorji, a senior citizen in Thimphu. In Bhutanese society, funeral costs extend far beyond cremation. Rituals, religious offerings, food for mourners, funeral arrangements, and observances that continue up to the 21st day all add up quickly, often pushing families into financial strain at a moment of deep emotional distress. “Behind the solemnity of prayer flags and butter lamps lies an uncomfortable truth; many families are struggling to afford a dignified farewell for their loved ones,” says businessman Tenzin Thinley. “I have personally been approached by more than four people seeking loans to meet funeral expenses. When families are already grieving, borrowing money only deepens their suffering.” Such experiences reflect a growing national concern and highlight long-standing calls to reform one of Bhutan’s oldest social protection schemes. Perhaps it is for this reason that both the ruling People’s Democratic Party (PDP) and the opposition Bhutan Tendrel Party (BTP) pledged during the recent elections to raise the RLIS payout from Nu 30,000 to Nu 150,000. Since the Fourth Parliament convened, opposition members have consistently raised the issue in every session, making it one of the most persistent social protection concerns in Parliament. With rising costs and growing public pressure, the current parliamentary session had renewed public attention and expectation, particularly in rural communities where RLIS support is most critical. “I listened carefully to the Finance Minister’s response,” says a farmer, Wangchu. “It is reassuring that the government has reaffirmed its commitment. This has to be done, one way or another.” However, he adds that the issue extends beyond political promises. “This is not about people trying to benefit unfairly from the government,” he says. “It is about support during one of the hardest moments in life. Everyone, including the government, knows there is truth in what people are saying.” According to the Finance Minister, the revised payout of Nu 150,000 is now expected by 2027, subject to the passage of the Financial Services (Amendment) Bill 2025 by the National Council. Nearly Nu 590 million has already been earmarked in the upcoming fiscal year, signaling government readiness for implementation once legislative approval is secured. However, the timeline now depends on parliamentary action. “I requested that the Financial Services Bill be treated as urgent, but it did not proceed as I had hoped,” the Finance Minister said in Parliament last week. “The Bill was passed by the National Assembly during the winter session last year, and we are now waiting for its adoption by the National Council. Once adopted, we plan to implement the revised scheme by 2027.” At present, the RLIS covers more than 630,000 members nationwide, with a total insured value estimated at nearly Nu 19 billion. Introduced in 1982, the RLIS remains one of Bhutan’s most enduring social protection programmes, providing life insurance coverage for rural households, including compensation in the event of the death of enrolled family members. Currently, members pay an annual premium of Nu 195, with individuals contributing Nu 87 while the government subsidizes Nu 108. If approved, the revised payout would mark the most significant enhancement to the programme in years, offering stronger financial protection at a time when emotional loss is often compounded by economic hardship. For many households, however, this issue is not merely about insurance. It is about dignity and for the government, a responsibility. In a country internationally recognized for placing wellbeing at the heart of development, citizens argue that support during death and bereavement should not be seen as generosity, but as responsibility. “We are looked at around the world as a country that puts wellbeing at the center,” says Goembo. “If the government cannot assist people in moments like this, then people will naturally begin to question what wellbeing truly means.” As Bhutan continues to modernize its social protection systems, citizens are watching closely, not only for the fulfillment of an electoral promise, but for reassurance that no Bhutanese family should have to choose between mourning a loved one and falling into financial distress to afford a dignified farewell. Tashi Namgyal , Thimphu