crop insurance in india: reaching the unreached
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Crop insurance in India: Reaching the Unreached
Pramod Aggarwal CGIAR Program on Climate Change, Agriculture, and Food Security
Progress of Crop Insurance In India
0 5
10 15 20 25 30 35 40 45 50
1980 1985 1990 1995 2000 2005 2010 2015 Year
No of farmers, million Area covered, million ha Insured farmers,
19%
Uninsured farmers, 81%
Top 10 reasons for dissatisfaction in unsatisfied index-insured farmers*
26.8 29.8
33.8
37.3
44.3
45.3 53.3
56.5
56.5
80.8
0
20
40
60
80
100 Types of Risks Covered
Period of Risk Coverage
Time Delay in Claim Settlement
Explanation on WBCIS Policy
Quantum of Sum Assured
Responsiveness of Intermediary
Resolution of Queries
Mechanisms for Grievance Redress
Convenience in Enrollment
Location of Weather Station
*Source: AFC, GOI, 2011
Farmer’s main suggestions for improving crop insurance
• Insurance literacy: Greater understanding of crop insurance programs
• Product design: easy to understand and site specific
• Site-specific data: weather, crop-cutting samples for yield loss assessment
*Source: AFC, GOI, 2011
• Further standardization of products based on agronomic and statistical principles to support robust actuarial design and pricing: AEZ specific Atlas
Scaling out crop insurance in India Improved product design
• Bundling with other risk management initiatives such as drought/flood tolerant varieties, water management practices- climate smart villages
• Double trigger products
• Bundling with disaster relief/ management
Scaling out crop insurance in India Products for comprehensive risk management
Scaling out crop insurance in India Engaging farmers in product design and MRV
• Huge penetration of smartphones/tablets
• Rural service centres • Online policies and
enrollment • Crowd sourcing of farmers
practices and digital images of crops
• Cloud computing of losses • Continuous feedback to all
stakeholders • Direct benefits transfer- 115
million bank accounts for poor in 6 months
• Linkages with other schemes such as agro-advisories
Scaling out crop insurance in India ICT solutions
Scaling out index insurance in India Improved targeting
1 dot = 25000 ha Source: IMD gridded data 1981 to 2011
Summary Scaling-out crop insurance: Key actions
1. Improved insurance literacy 2. Comprehensive risk
management solutions: integrating insurance with other approaches
3. Engaging farming communities in product designing and MRV
4. ICT for scaling out, farmers participation, and for quick settlement of claims.