How do I reduce financial risk to my farm from natural disasters like floods or drought?
Ans.The simplest way to reduce the risk of floods or drought for farmers is to take out a crop insurance policy. In India, the Agriculture Insurance Company of India (External website that opens in a new window) (AIC) is exclusively responsible for implementing the National Agricultural Insurance Scheme (External website that opens in a new window) or NAIS. The NAIS Scheme covers all farmers including sharecroppers and tenant farmers growing notified crops in notified areas from risk such as natural fire, lightning, storms, cyclones, floods, landslides, droughts, pests and diseases. Three levels of indemnity, viz., 90, 80and 60 per cent corresponding to Low Risk, Medium Risk and High Risk areas shall be available for all crops (cereals, millets, pulses and oilseeds and annual commercial / annual horticultural crops) based on Coefficient of Variation (C.V.) in yield of past 10 years’ data. AIC has other crop insurance schemes such as Varsha Bima (External website that opens in a new win
