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Resource centre on India's rural distress
 
 

Well-functioning crop insurance crucial for reducing farmer’s vulnerability -Natasha D'cruze, Priyadarshini Ganesan, Natasha Dcruze and Priyadarshini Ganesan

-The Hindu Business Line

It is an important tool for agrarian families to manage and mitigate their risks

Agricultureplays a pivotal role in the Indian economy, especially in rural areas.According to the recently-releasedSituational Assessment and Land Holdings of Agricultural Households in Rural India Report (SAS, 2019)by the National Statistics Office,54 per cent of rural households are agricultural, earning37 per cent of their householdincome from farming.

This sector, however, is also subject to a multitude of constraints – marginal land holdings, lack of irrigation facilities, susceptibility toprice and weather induced shocks, crop loss and crop failure – making it hard for farming households to practice agriculture sustainably.

Moreover, they also face vulnerabilitieslikeclimatic changes,erratic weather,diseases, damage caused by insects, pests, or animals, and by natural disasters like floods among others. Insurance, therefore, becomes a very important tool for agrarian families to manage and mitigate their risk.

This article draws insights from SAS, 2019 tohighlight someof the existing gaps in marketing, servicing, claim payout and coverage in the crop insurance market in India.

Deep fault lines

Insurance take-up is still relatively low and the average share of agricultural households holding crop insurance stands at 10.5 per cent for both the July-December 2018 and January-June 2019 seasons and all crops combined.

Please click here to read more.