In recent years, it has been shown that when farmers insure against floods, pests, and other risks that affect their agricultural livelihoods, they can invest more confidently in their farms or in nonagricultural activities in areas like trade, education, or health.
There are about 1.5 billion individual farmers in developing countries and, from those, a recent study estimates that 198 million have some form of agricultural insurance coverage. Most of the insured (193 million) are concentrated in China and India.
Risk is an inherent feature of agriculture around the world, Agri insurance helps reduce these risks. Digital tools have made it easily accessible to farmers. Let us look at some of the Digital Innovations in the field of Agri Insurance:
- NABARD: National Bank For Agriculture & Rural Development is set up as an apex Development Bank by the Government of India with a mandate for facilitating credit flow for promotion and development of agriculture, cottage and village industries. They are experimenting with digitizing premium payments and claim payouts.
- Mobile Technology: The International Water Management Institute (IWMI) is launching a mobile app, called AgRISE, in support of a new national agricultural insurance scheme – Pradhan Mantri Fasal Bima Yojana (PMFBY). The scheme aims to provide more than half of Indian farmers with crop insurance within the next 2‐3 years. Relying on satellite and climate data, combined with field data on crop yields, AgRISE (Agricultural Remote Sensing‐based Insurance for Security and Equity) delivers a crop health card, which enables insurers and government agencies to estimate crop damage and overall insured losses quickly and reliably for all of India’s major crops. Based on the latest geospatial technology (Google Earth Engine and Open Data Kit for field data collection), the tool will strengthen the implementation of PMFBY, reducing costs and facilitating the whole process.
- Drone: DRONE (Dynamic Remotely Operated Navigation Equipment) technology that has caught the attention of large farmers, crop insurance stakeholders, and Government because it can provide ‘farm-specific’ information on crop condition, losses to farmers and in reaching the right kind of benefits to right people. With flying just at 150 m – 200 m above ground level, this makes it as one unique platform. The sensors that can be placed onboard on any of these three platforms (regular satellite, nano-satellites, and Drones) are largely the same and can provide comparable information with varying levels of details.
- Satellite Technology: Satellite remote sensing is capturing information about different ground features while staying 400+ km above the ground. A variety of sensors can be placed on board wherein these satellites can gather information. These have proved to be very useful in getting a fairly accurate data on sowing trends, acreages of different crops, stress on crops during mid-season and area affected due to this, harvesting trends, yield and production estimates in a very short time, which otherwise takes months together in collating and compiling using traditional methods. There are more than 100 different satellites providing a range of parameters measured from satellite platforms, allowing high frequency of revisit and continuously improving spatial and spectral resolutions. It is now possible to address all loss assessment issues through effective use of these datasets right from prevented sowing to mid-season adversaries to yield estimation with more accuracy and efficiency.
With the substantial population of about 118.7 million farmers and cultivators as well as 144.3 million agricultural laborers (Agriculture census -2010-11), the Indian economy is largely dependent on agriculture, which is considered as the most common occupation of rural Indian families and agrarian communities across the country.
In recent years, the erratic and unpredictable behavior of Monsoon,
accentuated by Climate Change has caused extensive financial losses in terms of crop failures, damage to agricultural infrastructures, loss of lives and properties, etc. due to natural and manmade disasters and destruction to environment and farmlands.
In order to combat this challenge, there is a need to adopt a strategy that may provide a comprehensive solution to farming communities for safeguarding their agricultural productivity. Agricultural or Agri Insurance is one such area that is gaining momentum in the country.