Agriculture insurance OR Crop insurance

Crop Insurance
Crop Insurance

We all know that the Indian farming industry is a very volatile and very risk-based industry. At the same time, farmers are not aware of the importance of Agriculture insurance or crop insurance in India.

We have heard and read in news or watched on tv, that so many farmers commit suicide due to the losses incurred because of agriculture or farming.

The risks that agriculture in India is facing vary, starting from environmental issues like no rain or heavy rains, adulterated seeds, Pests, etc.

Whatever the risk is, the damage is done to the crop and the affected person will be the farmer.

So, it is very important to buy agriculture insurance in India to cover all these risks.

In this blog, I am trying to focus on different agriculture insurance or crop insurances that are available in India.

Since India is an agriculture-based economy, the government also focuses on the farmer’s wellbeing. This includes state and central governments.

So, agriculture insurance in India is provided by the public sector (government schemes) and the private sector.

Risks of the Indian agriculture industry

Crop loss due to Floods

The monsoon season India generally starts from June and lasts till September. During the June period, farmers start planting or sowing for the crops. And by the end of August, the crops will be ready for harvest.

But during this season only there is a high risk of floods, sometimes the floods start in June itself so that the farmers cannot start their crops in a timely manner, and they will lose precious time. If the floods come in August or September, then it creates more damage since the farmers already spent their money and time on the crops.

Here are some stats on the loss of crops due to floods during 2019.

S.NoStateTotal Agriculture Area Affected
1Assam2.14
2Bihar2.61
3Chhattisgarh 0.018
4Karnataka9.35
5Kerala0.31
6Madhya Pradesh6.04
7Maharashtra4.17
8Nagaland0.02
9Odisha1.49
10Punjab1.51
11Rajasthan27.36
12Tripura0.014
13Uttar Pradesh8.88
14Uttarakhand0.003
15West Bengal0.08
Total63.995

Crop Loss due to No rains or Draught

Since the world is facing the Global warming problem, it is affecting the environment in all the countries and India is not an exception to this problem.

The rainfall rate is continuously decreasing year by year in India.

States like Rajasthan are facing severe problems due to drought, they are facing drinking water issues. So, one can imagine how the crops can be survived in these states. https://www.indiatoday.in/india/story/rajasthan-declares-1-388-villages-in-4-districts-drought-affected-1618063-2019-11-12

Agriculture insurance-Drought in India
Drought in India

Crop Loss Due to Fake Seeds

Indian farmers facing another major issue that is fake seeds. When a farmer goes to a seed seller, the seller advises the farmer to buy some fake seeds as the seller gets huge margins on those brands. But at this point, no one guarantees the farmer that the seeds are original and all or maximum percent of seeds will be germinated successfully.

But once the seeds are spread across the fields only 10 to 20% of the seeds get germinated remaining will be dead. This is a huge loss for a farmer as the seed sowing time will be gone by then. So, the farmer cannot plant for that season.

This is a big loss in terms of money, time and efforts.

Crop Loss Due to adulterated Pesticides

This is another factor that is contributing to losses of the Indian agriculture industry.

Fertilizers and pesticides are very important for crops to grow healthy and give good yields. That is why the farmers willing to spend money on these to protect their crops from deceases and bugs.

But when these fertilizers are adulterated then the crops do not give good yields and the farmers end up with huge losses.

Unfortunately, not all these risks are covered under agriculture insurance. Especially Fake seeds and pesticides.

List of companies providing Crop Insurance:

  • Reliance General Insurance Co. Ltd.
  • Cholamandalam MS General Insurance Co. Ltd.
  • Agriculture Insurance Company of India Ltd
  • IFFCO-Tokio General Insurance Co. Ltd
  • HDFC ERGO General Insurance Co. Ltd.
  • ICICI Lombard General Insurance Co. Ltd
  • Future Generali India Insurance Company Limited
  • Bajaj Allianz General Insurance Co. Ltd
  • Universal Sompo General Insurance Company Limited
  • SBI

What is Covered in Agriculture insurance or crop insurance?

The crops are covered for the loss incurred due to natural calamities like Floods, Drought, earthquake, and fire.

Also, insurance can be taken against the risks of agriculture machinery like pump sets, tractors, etc.

Some companies cover life for the farmer. Along with the crop insurance farmers need to consider taking life insurance policies to save their families. It is very important to have insurance cover.

And crop insurance also covers the minimum market price. For example, the price of cotton is 100 per ton at the time of buying insurance and when it took to market if it falls to 80 rs then the remaining 20 will be covered by the insurance company.

Pradhan Mantri Fasal Bima Yojana – PMFBY

https://pmfby.gov.in/

The Indian government is also providing insurance cover for crops to help farmers and encourage farming. The PMFBY aims to cover different risks that a farmer can face for their crops.

PMFBY covers the loss incurred due to all-natural calamities.

It also covers the post-harvest loss i.e. within two weeks of harvesting a crop (only crops which are required to dry before moving to market) if a cyclone or flood hits the harvested crop and destroys the crop then PMFBY scheme will pay the money to the farmer.

PMFY-Video

Eligibility for Pradhan Mantri Fasal Bima Yojana – PMFBY

All farmers who take crop loans are eligible for this scheme. They automatically covered under this scheme by filling the required forms at the bank.

This is an optional scheme for the farmers who do not avail of any crop loans.

Here is an example of premium calculated for 3 hectors of Maize crop. The farmer needs to pay 3750Rs and the Government will pay 43125Rs as premium. Then the crop will be covered for 187500Rs.

PMFBY-Pradhan Mantri Fasal Bima Yojana
PMFJY-Premium Calculator

Weather Based Crop Insurance Scheme (WBCIS)

This scheme is intended to cover the losses incurred to crops due to extreme weather conditions such as high temperature, excess rainfall, short rainfall, etc.

These conditions affect the production/yield of a crop.

Applying for Pradhan Mantri Fasal Bima Yojana (PMFBY)

Farmers can directly apply for PMFBY by going online https://pmfby.gov.in/farmerRegistrationForm.

1. Register your details and then enter all the details related to the crop etc.

2. Calculate the premium using the Insurance premium calculator provided on that site.

3. Pay the premium and submit the application

4. Farmers can track their application status using the Application status feature available on the site.

5. In case of crop loss here are the contact numbers and information to report the crop loss.

Extract from Guidelines in PMFBY

1. The Maximum Premium payable by the farmers will be 2% for all Kharif Food & Oilseeds crops, 1.5% for Rabi Food & Oilseeds crops and 5% for Annual Commercial/Horticultural Crops.

 2. The scheme is compulsory for loanee farmers obtaining Crop Loan /KCC account for notified crops. However, voluntary for Other/non-loanee farmers who have an insurable interest in the insured crop(s).

Insurance Company NameToll Free NumberHeadquater EmailHeadquater Address
AGRICULTURE INSURANCE COMPANY1800116515fasalbima@aicofindia.comOffice Block-1, 5th Floor, Plate-B & C, East Kidwai Nagar, Ring Road, New Delhi-110023
BAJAJ ALLIANZ GENERAL INSURANCE CO. LTD18002095959bagichelp@bajajallianz.co.inBajaj Allianz House, Airport Road, Yerawada, Pune 411 006
BHARTI AXA GENERAL INSURANCE COMPANY LTD.18001037712customer.service@bharti-axagi.co.in7th floor, Merchantile House, K.G.Marg, New Delhi - 110 001.
CHOLAMANDALAM MS GENERAL INSURANCE COMPANY LIMITED18002005544customercare@cholams.murugappa.com2nd Floor, "Dare House", No.2, NSC Bose Road,Chennai - 600001, India. Phone: 044-3044 5400
FUTURE GENERALI INDIA INSURANCE CO. LTD.18002664141fgcare@futuregenerali.inIndiabulls Finance Centre, 6th Floor, Tower 3, Senapati Bapat Marg, Elphinstone West, Mumbai, Maharashtra 400013
HDFC ERGO GENERAL INSURANCE CO. LTD.18002660700grievance@hdfcergo.comD-301, 3rd Floor, Eastern Business District (Magnet Mall), LBS Marg, Bhandup (West). MUMBAI - 400078 State : Maharastra , City : MUMBAI, Pin Code : 400078
ICICI LOMBARD GENERAL INSURANCE CO. LTD.18002669725customersupport@icicilombard.comICICI Lombard House414, P.Balu Marg,Off Veer Sawarkar Marg,near Siddhivinayak Temple, Prabhadevi,Mumbai-400025.
IFFCO TOKIO GENERAL INSURANCE CO. LTD.1800-103-5490supportagri@iffcotokio.co.inIFFCO Tower ,Plot No. 3 , Sector 29 , Gurgaon -122001,Haryana(India)
NATIONAL INSURANCE COMPANY LIMITED18002007710customer.relations@nic.co.inNational Insurance Co. Ltd.3 , Middleton Street , Kolkata -700071,West Bengal
NEW INDIA ASSURANCE COMPANY18002091415customercare.ho@newindia.co.in87, MG Road, Fort, Mumbai - 400001
ORIENTAL INSURANCE1800118485renukaahluwalia@orientalinsurance.co.inThe Oriental Insurance Company Ltd.Crop Cell, Head Office, New Delhi
RELIANCE GENERAL INSURANCE CO. LTD.18001024088rgicl.services@relianceada.comReliance Centre , South Wing , 4th floor,Off Western Express Highway, Santacruz (East), Mumbai - 400055
ROYAL SUNDARAM GENERAL INSURANCE CO. LIMITED18005689999crop.services@royalsundaram.inVishranthi Melaram Towers, No. 2/319, Rajiv Gandhi Salai (OMR), Karapakkam, Chennai - 600097
SBI GENERAL INSURANCE18001232310crop.help@sbigeneral.in101,201,301, Natraj. Junction of Western express highway & Andheri - Kurla road. Andheri East Mumbai - 400069
SHRIRAM GENERAL INSURANCE CO. LTD.180030030000/18001033009chd@shriramgi.comE-8, Epip, Riico Industrial area, sitapura Jaipur (Rajasthan) 302022
TATA AIG GENERAL INSURANCE CO. LTD.18002093536customersupport@tataaig.comPeninsula Business Park, Tower-A, 15th Floor, Ganpat Rao Kadam Marg, Lower Parel, Mumbai, Maharashtra-400013,India.
UNITED INDIA INSURANCE CO.180042533333customercare@uiic.co.inCustomer care department, no.24, whites road, Chennai-600014
UNIVERSAL SOMPO GENERAL INSURANCE COMPANY18002005142contactus@universalsompo.comUnit No 401, 4th Floor, Sangam Complex,127, Andheri – Kurla Road, Andheri (E),Mumbai-400059.

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