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Reliance General Insurance has entered into the agriculture segment through the launch of weather- and yield-based crop insurance schemes for farmers in five States.
The company is now offering these products to farmers in Bihar, Haryana, Assam, Uttarakhand and Uttar Pradesh.
Plans are afoot to cover nearly one lakh farmers in 10 States by the end of this financial year (2013-14), Rakesh Jain, Chief Executive Officer, Reliance General Insurance said in a statement.
Reliance General Insurance, which is part of Reliance Capital, has been empanelled by the Union Government to implement weather-based crop insurance (WBCI) scheme in 21 States.
Besides, the company has also received mandate from the National Agricultural Insurance Scheme (NAIS) to offer yield-based crop protection to farmers in 50 identified districts across the country.
The yield-based crop insurance would cover pre-sowing, post-harvest and losses due to natural calamities, pests and diseases.
Non-life insurance companies see agriculture companies as the next driver of growth.
The domestic agriculture insurance premium market is estimated at about Rs 5,000 crore.
“We are aiming at a significant share of this domestic agriculture insurance premium in the next couple of years,” Jain said.
Reliance General Life will provide cover against weather-related risks, which could be excessive rainfall or a shortage in rainfall, fluctuations in humidity and variations in temperature.
For kharif crops, rainfall parameter will be covered. And in the case of rabi crops, temperature, humidity, rainfall and combination of all these parameters will be covered, the statement added.
Weather insurance schemes facilitate immediate compensation based on objective data obtained from the Indian Meteorological department.
It also gives farmers the flexibility to take up insurance for a particular critical stage of crop growth or for the entire crop cycle.
The Modified National Agricultural Insurance Scheme covers farmers from yield-based risks as well as many other risks during the life of a crop.
Both the Union and State governments subsidise the premiums paid by farmers, while the claims are borne by the insurer.
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