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Crop Insurance

Crop Insurance In India     

Crop Insurance in India is definitely one amongst the country’s major occupation.

Most fifty two you look after Indians rely on the crops that they yield for his or her living.

Farm contributes Sixteen Personality Factor Questionnaire to the value of the country.

Sadly, agriculture in India is a risky business for farmers thanks to the probabilities of natural disasters(floods, droughts etc.).

The unsteady costs of agricultural product are a supply of worry too. For the sake of farmers within the country, the govt has launched crop insurance to lighten the significant risk related to agriculture.

Farming producers (including ranchers, farmers and others)purchase crop insurance so as to shield themselves against the loss of revenue thanks to declines within the costs of agricultural commodities or from the loss of their crops thanks to natural disasters (such as floods, hail, pests, diseases, drought etc.).

Crop-revenue insurance and crop-yield insurance ar the 2 general classes of crop insurance.

Crop insurance is purchase by agricultural producer, as well as farmers, ranchers et al. to shield against either the loss of their crops thanks to natural disasters, or the loss of revenue thanks to declines within the costs of agricultural commodities.

There are 2 major forms of crop insurance: Multiple peril crop insurance (MPCI) and crop-hail.

Crop insurance is purchased by agricultural producers, as well as farmers, ranchers et al. to shield against either the loss of their crops thanks to natural disasters, or the loss of revenue thanks to declines within the costs of agricultural commodities.

Detailed Information:

There are 2 major forms of crop insurance: multiple peril crop insurance (MPCI) and crop-hail insurance.

National Crop Insurance Programme provides resource to farmers for losses in their crop yield, to assist in maintaining flow of agricultural credit, to encourage farmers to adopt progressive farming practices and better technology in Agriculture and thereby, to assist in maintaining production, employment.

The largely used Crop Insurance in India.

Why is Crop Insurance required?

  • To help stabilize agriculture incomes, particularly within the years that disaster hits.
  • Provide farmers with backing and amount of money within the event of natural calamities, diseases and pests.
  • To inspire farmers to implement progressive farming practices with higher technology.

Features and Benefits of Crop Insurance:

  • The fact that the insurance can cover financial backing within the unfortunate event of failure.
  • Motivate farmers to adopt progressive farming practices and better technology in a farm.
  • Crop insurance in India facilitates farmers maintain the flow of agricultural credit.
  • Another necessary profit is that crop insurance streamlines loss assessment procedures and additionally helps to create up correct applied math base for crop production.

What’s covered & what’s not covered in Crop Insurance?

   Following may be a list of what’s lined and what’s not below such policies:

  • Loss or harm to the property of the client farmer.
  • Injury or loss caused because of a hearth or natural disaster( together with a storm, flood, tornado, earthquake, cyclone etc.)
  • Coverage for private injury. This includes the insured farmer and therefore the farmer’s family members).
  • Cover for loss of pump set.
  • Cover for injury/loss of tractor.
  • Coverage for damage/ loss caused by power outage.
Crop Insurance
Crop Insurance

List of companies which offers Crop Insurance:

  • Following are the list of companies are included:
  • Tata AIG General Insurance Co.Ltd.
  • Reliance General Insurance Co.Ltd.
  • Cholamandalam Ms General Insurance Co.Ltd.
  • Agriculture Insurance Co.Ltd.
  • IFFCO-Tokio General Insurance Co.Ltd.
  • HDFC ERGO General Insurance Co.Ltd.
  • ICICI Lombard General Insurance Co.Ltd.
  • Future General India Insurance Co.Ltd.
  • Bajaj Allianz General Insurance Co.Ltd.
  • Universal sompo General Insurance Co.Ltd.
  • SBI
Crop Insurance

Crop Insurance Scheme In India

In Bharat still regarding half of the population depends on agriculture and regarding twelve large integer farm families directly rely on it for his or her livelihoods.

Even once seventy years of freelance designing, still Indian agriculture depends on the vagaries of monsoon-like droughts, floods, and different natural calamities.

The risk in Indian agriculture in a lot of above different developing countries. one natural cataclysm can crater have within the whole rural economy or in localized areas by destroying the crops.

One unhealthy crop season results in a scenario of the destruction of crops, farm assets, crop losses.

The frequent natural calamities area unit forcing farmers into mounting debt from informal cash lenders at usurious interest rates and ultimately resulting in widespread farm distress and farmers suicides.

The large development commixture over many nations as well as made states like geographic region, Punjab, Himachal Pradesh, and Mysore and recently in capital town Delhi and additionally metropolis.

Natural Damage:

The crop Insurance could be a basic strategy by the govt. to manage the crop risk related to unseasonal rainfalls, floods, different natural calamities.

The foremost notable theme during this space is Pradhan Mantri Fasal Bima Yojana.

The central and state governments pay Rs. 32,606 crores to subsidize crop insurance premiums, outside maintaining correct farmer’s records until 2015-16, as per bourgeois and Auditor General of Bharat report.

Online Crop Insurance schemes associate degree implementing past expertise over the year.

The theme is mandatory for the loaner farmers, whereas for non-loner farmers it’s nonmandatory.

In 2016-17, this theme coated 5.

7 crores farmers out of twelve crores, consisting of four.

41 large integer loanee and one.

33 non-loaner farmers.

In terms of gross cropped space, the theme coated fifty-eight.

A million hectares out of 194 million hectares.

Pradhan Mantri Fasal Bima Yojana achieved its target each in terms of coverage of space and additionally a variety of farmers however there’s mounting proof of denial of claims.

Pradhan Mantri Fasal Yojana(PMFBY)

Weather-based mostly Crop Insurance Scheme (WBCIS) – Operational Guidelines(OGs)

Unified Package Insurance Scheme (UPIS) – Operational Guidelines(OGs)

National Agricultural Insurance Scheme (NAIA ) – Scheme and Operational Modalities

National Crop Insurance Programme(NCIP)- changed National Agricultural Insurance Scheme(MNAIS), Weather based mostly Crop Insurance theme (WBCIS) and coco Insurance Scheme(CPIS)- Operational tips.

Draft report of the Committee entrenched for the preparation of draft tips for putting in AWSs, ARGs and their certification, Standardization, validation and quality management of weather knowledge.

Comparative Statement of Crop Insurance Schemes.


  • To offer amount and economic support to the farmers within the event of failure of any of the notified crop as a result of natural calamities, Pests, and diseases.
  • Stabilize the financial gain of farmers to confirm their continuance in farming – To inspire farmers to adopt innovative and trendy crop practices.
  • To ensure a flow of credit to the agriculture sector.
  • Motivating farmers to adopt innovative and trendy agricultural practices.
  • Implementing Agency (IA)
  • The theme shall be enforced through a multi-agency framework by chosen insurance corporations
  • Under the general steering and management of the Department of Agriculture, Cooperation and Farmers Welfare, Ministry of Agriculture and Farmers Welfare, Government of Bharat and therefore the involved State in coordination with varied different agencies.

Other important objectives:

Pradhan Mantri Fasal Bima Yojana can supply a comprehensive insurance cowl against a failure of the crop, therefore, serving to in stabilizing the financial gain of the farmers and inspire them for the adoption of innovative practices.

Online Crop Insurance theme will cowl all food and Oilseeds crops and Annual Commercial/Horticultural Crops that past yield information is offered and that requisite range of crop Cutting Experiments are going to be conducted is a neighborhood of the overall Crop Estimation Survey.

Online Crop Insurance theme is mandatory for loaner farmer getting crop loan account for notified crops.

However, voluntary for other/non-loanee farmer UN agency have an interest within the insured crops.

The Maximum premium collectible by the farmers are going to be two for all Kharif Food and Oilseeds crops, 1.5% for Rabi Food and Oilseeds crops and five-hitter for Annual Commercial/ farming Crops.

The distinction Between premium and therefore the rate of Insurance charges collectible by farmers shall be shared equally by the Centre and State.

The theme is going to be enforced by A/C and different impaneled non-public general insurance corporations.

Choice of implementing Agency is going to be done by the involved government through bidding.

The existing State Level Coordination committee on Crop Insurance(SLCCCI), a committee to SLCCCL, District Level observation Committee (DLMC) shall be liable for the correct management of the theme.

Crop Insurance theme in Bharat shall be enforced on Associate in Nursing ‘Area Approach basis’.

The unit of insurance shall be the village/village council level for major crops and for different crops it should be a unit of size higher than the amount of village/village council.

TATA Aig Insurance company also provides crop insurance.

Key Features of PMFBY

  • Low Farmer Premium Rates

Farmers, Banks, State  Government and Central Government, Insurance Companies etc.

Sr.No.SeasonCropsMost Insurance Charges Payable By Farmers(% of add Insured)
1KharifSome food product and Oil seeds crops(all Cereals, Millets, Pulses and Oilseeds crops)
2.0% of SI or figurer rate, whichever is a smaller amount.
2RabiSome food product and Oil seeds crops (all Cereals, millets, pulses and Oilseeds crops)
1.5% SI or figurer rate, Whichever is a smaller amount.
3Kharif and RabiYearly Commercial/Annual agriculture crops
5% of SI or figurer rate, Whichever is a smaller amount.
  • Use of Technology

The new theme several new things like utilizing innovative technologies like satellite imagination, vegetation indices etc. coupled with the obligatory usage of smartphones/ hand-held devices for increasing the speed and accuracy throughout yield estimation.

  • Increased Farmer Awareness

Efforts area unit create an extent to notice amongst farmers relating to PMFBY so the most range of farmers will inscribe and avail edges of the theme.

  • Better Coverage

Pradhan Mantri Fasal Bima Yojana aims at covering the losses suffered by farmers because of reduction in crop yield as calculable by the native applicable government authorities.

The theme conjointly covers pre-sowing losses, post-harvest losses because of cyclonic rains and losses because of unseasonal precipitation in an Asian country.

Who can take this policy?

Some farmers, as well as working person and holder farmers growing the notified crops within the notified square measures, are eligible for coverage.

However, farmers ought to have a stake for the notified/insured crops.

Eligible criteria:

Compulsory part

Some farmers availing seasonal agricultural operations loans from monetary establishments for the notified crop would coat obligatorily.

Voluntary part

The theme would be elective for the non-loanee farmers.

Documents needed

The non-loanee farmers square measure needed to submit necessary documentary proof of land records prevailing within the state.

Land possession Certificate and applicable contract/agreement details.

Other documents notified, allowable by involved State Govt. just in case of a loan.

Crop Insurance Karnataka

Crops secured

Nourishment crops (grains, millets, beats); oilseeds; business/green crops (sugarcane, cotton, potato, onion, stew, turmeric, ginger, jute, custard, banana, pineapple).

Include extra crops and cultivation of crops as soon as possible.

Qualification for inclusion

Open to all states and association domains and to all agriculturists (counting sharecroppers and occupant agriculturists) developing the informed crops in the told regions.

Ranchers with crop advances must buy crop insurance; others can choose to do as such.

Dangers secured

All common non preventable dangers.

Total guaranteed

For obtaining agriculturists, the advance sum is insurable, yet the sum can be stretched out up to a estimation of 150 percent of normal crop yield.

Non-borrowers can be guaranteed up to the estimation of 150 percent of normal yield.

Premium rates

For nourishment crops, the rate differs from 1.5 percent to 3.5 percent of the whole safeguarded, contingent upon the crop and season.

For business/agricultural crops, the actuarial rates apply.

Premium sponsorship

The underlying 50 percent sponsorship for little and minor ranchers will get eliminate; it was 30 percent for 2002– 03.

Plan approach

For far reaching catastrophes, the plan works on a zone yield approach decided for each crop, with the territory unit to be come to at the dimension of a panchayat [village] by 2006.

For confined catastrophes, the plan works tentatively on an individual dimension in restricted territories.

Repayment and deductible rates

Repayment and deductible rates and limit yield are set at levels to segregate between agriculturists as indicated by the hazard exposures as told by the legislature of Karnataka.  

  • Three reimbursement rates—90 percent, 80 percent, 60 percent—compare to okay, medium-hazard, and high-chance zones are accessible for all crops.

For instance, on account of a 90 percent repayment, the rancher holds territory yield misfortunes up to a deductible equivalent to 10 percent of assurance yield.

The protected agriculturists in a unit region may likewise settle on a higher endless supply of extra premium.

(Repayment limits will settle with one repayment level per crop per state)

  • The limit yield, the ensured yield for a crop in an insurance unit, is the moving normal of the past three years’ normal yield for rice and wheat, and the past five years’ normal yield for different crops, increased by the repayment rate.

Crop Insurance Karnataka is done on a large scale as compared to other states in India.

Crop Claim Method

Insurance of crop is that the primary risk management tool farmers use to financially live through natural disasters and volatile market fluctuations; pay their bankers, fertilizer suppliers, instrumentality suppliers, and landlords; purchase their production inputs for a consequent season, and provides them the arrogance to create future.

The farmer should pay the premium for any style of value insurance.

The govt. can facilitate within the premium payment within the initial stage.

In case of market value falling: throughout the harvest amount, just in case the notified {market value|market value|value} drops below warranted price, then the farmer is stipendiary by the insurance underwriter.

In case of damage: 1st, the yield information got to be received from the state/UT Govt.according to the prescribed limits.

Iowa runs down and settles the claims.

The non-public Nodal Banks can then receive the claim cheques and claim particulars.

This may be followed by the bank at the grass root level crediting the accounts of the individual farmers.

If Actual Cropper area unit of insured crop for the insurance unit insured season, falls in need of nominal starting crop, all insured farmers growing that crop within the outlined square measure square measure deemed to possess suffered insufficiency of comparable magnitude in a crop.

Pradhan Mantri Fasal Bima Yojana seeks to supply coverage against such contingency.


Yield Coverage

Some Food Crops (Cereals, Millets, and Pulses), Oilseeds, Yearly Commercial/Horticulture Crops.

Grower Coverage

Loanee: Some loaner availing seasonal Agricultural Operations loans from economical establishments for the notified crops would be offered obligatorily.

Non-loanee: Some loaner, as well as peasant and resident farmers growing the notified crops within the notified square measures, are eligible for coverage, but a theme is voluntary for Non-loanee farmers.

Risk Coverage

Following stages of the yield and danger resulting in crop loss square measure coated beneath the theme.

Planting Risk:

Planting thanks to deficit rain or adverse seasonal conditions

Standing Crop:

Comprehensive risk insurance is obtainable to hide crop losses thanks to non-preventable risks, viz. Drought, Dry spells, Flood, Inundation, Pests and Diseases, Landslides, Natural fireplace and Lightning, Storm, Rain, Windstorm.

Post -Harvest Losses:

Coverage offered solely up to a protracted amount of fortnight from gathering for those crops that square measure allowed to dry in cut and unfold condition within the field once gathering against specific risk of the cyclone and cyclonic rains and unseasonal snow.

Localized Calamities:

Loss/damage ensuing from the incidence of known localized risks of violent storm landslide, and flood touching distinctive farms within the notified space.

General Exclusions:

Losses arising out of deficit nuclear risks, malicious harm and alternative preventable risks shall be excluded.

Crop Insurance FAQs:

Q1. Which banks supply crop Insurance?

Following are the list of General Insurance firms which supply Crop Insurance Schemes:

Tata AIG General Insurance Co.Ltd.

Reliance General Insurance Co.Ltd.

Cholamandalam MS General Insurance Co.Ltd.

Agriculture Insurance Co.Ltd.

IFFCO-Tokio General Insurance Co.Ltd.

ICICI Lombard General Insurance Co.Ltd.

Future Generali Bharat Insurance Co.Ltd.

Bajaj Allianz General Insurance Co.Ltd.

Universal Sompo General Insurance Co.Ltd.


HDFC Ergo company also provides crop insurance.

Q2. Is Crop Insurance proverbial by the other term?

Alternative celebrated terms for crop insurance include:

Agriculture Insurance

Farm Insurance

Weather primarily based crop insurance

Q3. As a farmer, can the crop insurance cowl personal accident if I plan to get it?

Yes, not solely can the farmer get protect personal accident, however conjointly the members of the family of the insured farmer.

The insured farmer also will get protect the following:

Loss or harm to the property of the insured farmer

Damage or loss caused thanks to a hearth or natural disaster(including storm, flood, tornado, earthquake, cyclone etc.)

Cover for loss of pump set.

Cover for harm of tractor.

Coverage for injury caused by power outage.

Q4. The way to select the most effective crop insurance policy?

Crop insurance is needed for farmers, however, understanding that theme is best and that firms facilitate farmers to induce right claims.

Weather injury Management Pvt. Ltd helps to grasp the farm life cycle, crop diseases and thereby serving to them to induce right claims.

I would recommend some to examine Pradhan Mantri Fasal Bima Yojana to induce clarification on this.

Q5. What’s Crop Insurance? however, will it truly facilitate the farmers in India?

Cropping is among the foremost damages businesses. although you’ve got been growing crops for years, there’s forever a risk that a whole crop may be destroyed thanks to lack of rain, unseasonal rain or excess rain.

Crops conjointly get destroyed by pestilence.

There is a danger in laborers’ investment in seeds, fertilizers and therefore the value of labor and hiring instrumentation.

Within the case of money crops fairly often there’s a loan repay.

Crop insurance in India has mostly been within the nature of weather insurance it absolutely was earlier offered by General Insurance Corporation and post liberalization a separate company- the Agriculture Insurance Corporation of India was discovered.

The duvet was earlier provided to farmers with loans. Later it absolutely was extended to even people who don’t have loans.

The drawback of this cowl was that the insurance firm paid out claims provided that the administrative body declared a drought or flood for the district.

However, there are cases wherever farmers have suffered even while not a drought being declared.

As a result of low premium paying ability, non-public insurance firms don’t realize crop insurance unless there’s a company concerned WHO is doing the funding.

Prime Minister Narendra Modi has projected a theme wherever claims would be paid even while not the district is totally affected.

Q6. Have an academic or career targeted company?

The Central Government brought out a pioneering crop insurance theme.

The crop insurance suggests that the insurance firm supported the crop and space decide the worth of the turnout.

The farmer should pay the premium.

If the crop is unsuccessful thanks to the Risks of localized calamities and Post- Harvest losses the insurance firm pay the crop worth to the farmer.

So a farmer can ne’er face any crop loss currently onwards. thus there’s each scope for zero suicides as a result of crop losses.

For this farmer should pay simply one. 5% or two or five-hitter relying upon season and crop.

The remainder is born by state and central governments five hundredths every.

Crop Insurance is simply like all alternative insurance wherever the chance is roofed below for a particular premium.

In Bharat; because of not abundant returns farmers ne’er show interest within the crop insurance.

As the agriculture sector is wedged heavily due to drought/ flood and alternative conditions, even insurance firms are able to take a Brobdingnagian risk.

However, there’s a data concerning Indian agriculture.

Crop Insurance
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