INDIAN AGRICULTURE SCHEME CONTINUALLY LOSING MONEY

The Indian National Agriculture Insurance Scheme (NAIS) has lost a combined Rp49.8bn in the past 12 cropping seasons, according to the Agriculture Insurance Co of India (AIC), which runs the government scheme. Total claims have been estimated at Rp72.1bn, while premiums have amounted to Rp22.2bn, a loss ratio of 324%. The scheme covers about 75m farmers with some 121m hectares of land. Some of the key agricultural states, such as the Punjab, do not participate in the scheme because of the financial burden of premium subsidy. A modified insurance policy is currently being considered, under which the minimum indemnity level would be raised, cover of pre-sowing and planting risks would be included, and the possible inclusion of personal accident cover as part of the package. The current scheme is restricted to annual crops and charges between 1.5% of the sum insured for wheat to 3.5% for oilseed.