The company has engaged in states like Bihar, Madhya Pradesh, Maharashtra and Rajasthan
Agriculture Insurance Company of India (AIC), a nationalised insurance company, has introduced ‘Parametric Insurance’ to protect crops against weather vagaries. AIC has worked to gather the data with multiple credible weather data agencies like IMD, Skymet Weather and private/government vendor/agency that have automatic weather stations installed in various locations PAN India.
AIC aims to cover all Indian corporates and affinity groups and/or individuals owning establishments or businesses, income of which can be affected by variation in crop yields due to adverse weather conditions. The insurance programme entails tracking of various weather and crop parameters through automated weather stations and based on these parameters a crop-specific index is derived and the most suitable insurance product is created for a specific crop.
The adverse weather conditions indicated by direct proxy weather indicators are the trigger events for this insurance cover. The pay-outs are made when the weather index deviation exceeds a predetermined threshold which is detrimental to crop growth. For example, rainfall parameters are deficit rainfall cover, excess rainfall cover, unseasonal rainfall cover, cover for inadequate distribution of rainfall, cover for wet spells and more.
The company piloted the product with a leading warehousing company which is an agribusiness value chain integrator from India, focusing on catalysing the ecosystem for smallholder farmers and FPOs through post-harvest interventions that include storage solutions, credit and risk guarantees, financial and market linkages and policy level changes. AIC has covered 281 warehouses under this product in the current season located in various states like Bihar, Madhya Pradesh, Maharashtra and Rajasthan.
