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Rural Insurance


Please find below the details of the National Agricultural Insurance Scheme implemented by the Agriculture Insurance Company of India Limited for the economic growth of farmers.

Project Objective: Farmers can suffer losses due to droughts, floods, landslides, storms, tornadoes, hurricanes, extreme heat, lighting, fires, or pest infestations. In the event of production losses on declared crops, the insurance company provides farmers insurance coverage and financial assistance. The scheme can be availed by those who cultivate on leased land (lease cultivation) and farmers who produce the declared crops included in the scheme in each state. The farmers who take agricultural loans through banks / co-operative societies must be members of the scheme to develop the crops included in the scheme. Non-agricultural loan borrowers can also join the scheme at their option. A farmer who takes out a loan must insure the minimum amount of agricultural loan available through the financial institution for a given crop over a period of time. A farmer can insure his crop at a lower premium at a rate equal to the average cost of the crop.

Method of calculating compensation: If the yield of a particular crop in a specific area is less than the current yield (the average yield in the last 3-5 years), the loss is calculated in the same proportion for all the farmers who cultivate the same crop in that particular area. In such cases, all farmers who grow the same crop in the respective area will receive claims in proportion to the individual amount they have insured. State government data on yields per season will be submitted during each season. Claims will be calculated from this information.

Insurable Crops (District wise)

Climate Crop Insurance Coverage ,Sum insured and Premium rate at present.  (subject to change)

Crop District Risks covered Insurance amt. Farmer’s share
Paddy All districts except Alappuzha,
Kottayam, Pathanamthitta and Wayanad
Decreased rainfall, draught and
increase in temperature
50,000 1,000
Banana Plant All districts except
Pathanamthitta, Alapuzha
Increased rainfall,
heavy storm
100,000 5,000
Areca Palm Kaseragod, Kannur, Wayanad,
Kozhokode, Malappuram,
Palakkad, Thrissur
Disease prone climate,
scarcity of rain, draught
50,000 2,500
Chili Idukki, Wayanad, Kannur,
Kozhikode, Kasaragod, Malappuram,
Palakkad, Kollam and Kottayam.
Drought, Disease-prone climate,
Heavy rains, untimely rains,
Light rain
50,000 2,500
Ginger Idukki, Wayanad, Palakkad Scarcity of rain,
Heavy rain, Light rain
100,000 5,000
Turmeric Idukki, Wayanad,
Kozhikode, Malappuram,
Palakkad, Kollam,
Scarcity of rain,
Heavy rain, Light rain
60,000 3,000
Pineapple Idukki, Kottayam
and Ernakulam
Heavy rain, draught 35,000 1,750
Sugarcane Idukki, Palakkad Lack of rainfall,
excess rainfall, untimely rains
35,000 Up to 5%
Cardamom Idukki, Wayanad,Palakkad Disease prone climate and drought 120,000 5,310
Nutmeg Ernakulam, Thrissur Excess rainfall, drought,
dry weather, strong winds
50,000 2,500
Policy Risk of coverage Duration Sum insured Premium rate
Including GST
Rubber Plantation Natural Disasters, Strikes,
Mob attack, Attacks by wild animals,
Losses due to Vehicles,
Drought, and Terrorism
1 Yr. The amount fixed by the company
according to the age of the rubber
The amount fixed by the company
according to the age of the rubber
Livestock Insurance Disease, accident, natural disaster,
permanent and complete disability
1 Yr. 10,000 to 100,000 6%


Livestock insurance covers against loss of animals.

Criteria for Insuring

The value of livestock is determined based on age, health, milk availability, and breed. The veterinarian determines the amount to be insured. Typically, livestock is insured from 2 to 12 years old. Calves are insured for 4 months.


A livestock insurance policy mainly covers livestock losses due to illness or accident. It can also cover losses/damages caused by natural disasters, disabilities, and accidents while transported in a vehicle. Disability compensation is usually up to 75%. A permanent and total disability can include infertility, mastitis, stud-bulls, and buffaloes who lose the ability to reproduce. A veterinarian’s certificate is required in case of defects.

How to Insure: A veterinarian examining and evaluating livestock often taps a tag on the ear to identify them. The identification number of the animal is the number printed on it. In addition, the insurance certificate will include the animal’s age, color, horn length, height, and breed. Be careful not to lose the ear tag. In case of loss, the veterinarian must promptly re-tag and notify the insurance company.

Amount of Premium: The premium for regular livestock insurance is 6% per annum at present.

Claim Procedures: A veterinarian should be consulted in the event of an accident, illness, or disability caused by the risks covered by the policy. An insurance claim requires the insurance company’s claim form, a doctor’s certificate stating the cause of death, a post-mortem report, and an ear tag. The company will send the money to the customer’s bank account after settling the claim.

Amount of Compensation: The veterinarian determines the amount of compensation at the time of death. The insurance company will receive the claim amount if all supporting documents are submitted within 30 days of the incident. The claim amount will not be paid if the animal dies within fifteen days of taking the policy.

Dairy farmers, farms, and farming associations should prioritize insuring livestock on time. Three reasons favor insuring livestock: crossbreed cattle are at high risk, livelihood dependents suffer, and livestock prices are high.

Goat Insurance

Goat farming is also quite popular among the common folk today. Goat insurance aims to cover the risk of illness and accidents affecting goats. Goats come in various breeds, including native, hybrid, and exotic. Goats aged between six months and six years may be insured at the rate determined by the veterinarian. The annual premium rate is 8% at present. Identification tags will be attached to the goats’ ears. Color, breed, and age are also considered for identification.