Agriculture insurance has a long way to go in helping farmers manage risks in farming. A lot of awareness and simplification of norms are the need of the hour, say stake holders from the sector. In a country, where agriculture is largely influenced by climatic conditions and remunerative prices for farm produce are a distant dream, crop insurance can be of great help. But, surprisingly, instead of being a sought-after avenue for risk management, crop insurance schemes failed the farmers when they needed it the most. “Banks are deducting premium amount from the loan amount issued to us. But, farmers do not get any help from insurance company or the government in case of crop loss, due to complex rules and conditions. With no hope of reimbursement from any one, in case of crop loss, we feel even the amount deducted from banks towards premium as unnecessary burden,” rued P Komulaiah, a farmer from Wanaparthy in Telangana. Meanwhile, when farmers are taking loans from banks, they are mandatorily charged insurance premium amounts, pushing them to opt for insurance in some states. When it comes to taking credit out of banking system, most do not even have an idea of insurance. “Insurance is a tool for risk management, which is very essential for Indian farmers. While farmers are ignorant of agri-insurance, even a lack of will among governments and insurance companies to popularise agriculture insurance is adding to the problem. Awareness needs to be created about the benefits of insurance among farmers and agriculture insurance policies should be simplified to cover the actual losses,” said Vijay Sardana, noted agriculture and rural economist. After the introduction of Pradhan Mantri Fasal Bima Yojana in February, 2016, the amount to be paid by the farmers towards premium has considerably decreased. Farmers need to pay only two per cent and 1.5 percent for regular crops in Kharif and Rabi seasons, respectively, and five per cent for commercial crops. The remaining amount of premium is paid by the state and the central government. Besides Agriculture Insurance Company of India, private insurance companies such as Bajaj Allianz, Cholamandalam MS, Royal Sundaram, Iffco-Tokio, HDFC Ergo have also been operating in agriculture insurance sector. With the entry of private companies, awareness on agriculture insurance is also likely to increase which would further help the area of crop insured to grow. “As farmers lack awareness and drive to get insured right now, we have ordered field-level agriculture officers to convince farmers to take farm insurance and accustom them to the culture of agriculture insurance,” said a senior official, who looks after agri-insurance in Telangana agriculture department. From the last kharif season, the government has adopted villages as units for calculating compensation in case of crop loss instead of mandal, thus improving the prospects of farmers getting compensation in case of crop loss due to natural calamity. But farmers feel this as just a small step. Complexities in claims are another hindrance that needs to be addressed to win the trust of farmers in agri-insurance. “The conditions of crop insurance change from crop to crop and from district to district, thus creating confusion among farmers. Will any farmer find an insurance agent in their village or nearby town, like they find vehicle insurers and life insurers? Unless the farmer is taken as unit or the extent of farm area decreased for compensating, agri-insurance will not serve the purpose,” says Yerneni Nagendranath, Chairman, Federation of Farmers. Source - http://www.newindianexpress.com