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Agriculture Insurance Company of India
The Agriculture Insurance Company of India Limited (AIC) is a central public sector undertaking in India, owned by the Ministry of Finance, Government of India. Headquartered in New Delhi, it operates as a government-owned agricultural insurer. AIC falls under the direct ownership of the Government of India and operates under the administrative oversight of the Ministry of Finance. The company offers both yield-based and weather-based crop insurance programs, serving nearly 500 districts across India. AIC’s coverage extends to approximately 20 million farmers, making it the world’s largest crop insurer in terms of the number of farmers it serves.
AIC was established on December 20, 2002, with an authorized capital of Rs. 1500 crore. The initial paid-up capital amounted to Rs. 200 crores, with subscriptions from promoting entities, including the General Insurance Corporation of India (GIC) at 35%, NABARD at 30%, and the four public-sector general insurance companies (National Insurance Co. Ltd., Oriental Insurance Co. Ltd., New India Assurance Co. Ltd., and United India Insurance Co. Ltd.) at 8.75% each.
AIC’s primary objectives include providing insurance coverage and financial assistance to farmers in the event of crop failure due to natural calamities, pests, and diseases, thereby restoring their creditworthiness for the upcoming season. The company also aims to encourage farmers to adopt progressive farming practices, high-value inputs, and advanced technologies while stabilizing farm incomes, especially during disaster years. The comprehensive risk insurance offered by AIC covers yield losses caused by various natural events such as fire, lightning, storms, hailstorms, cyclones, typhoons, tempests, hurricanes, tornadoes, floods, inundation, landslides, drought, dry spells, pests, and diseases, among others.
Read More : Agricultural insurance in India
Agriculture Insurance Company of India
Type
Industry
Founded
Products
Net income
Number of employees
Website
Headquarters
Central Public Sector Undertaking
Agricultural Insurance
2002
\$74 Million United States dollar
283
Plate B&C, 5th Floor, Block 1, East Kidwai Nagar, New Delhi-110023
Important people
Ms. Girija Subramanian Chairman & Managing Director
Owner
Ministry of Finance, Government of India
Incorporation
AIC was formally incorporated on December 20, 2002, with an authorized capital of Rs. 1500 crore. The initial paid-up capital amounted to Rs. 200 crores, and it was subscribed to by the promoting entities. General Insurance Corporation of India (GIC) held a 35% stake, NABARD held 30%, and each of the four public-sector general insurance companies—National Insurance Co. Ltd., Oriental Insurance Co. Ltd., New India Assurance Co. Ltd., and United India Insurance Co. Ltd.—held an 8.75% share.
AIC operates under the administrative jurisdiction of the Ministry of Finance, Government of India, and is subject to operational oversight by the Ministry of Agriculture, Government of India. The regulatory authority responsible for governing AIC is the Insurance Regulatory and Development Authority (IRDA), situated in Hyderabad, India.
Starting A Business
AIC initiated its business operations on April 1, 2003, by assuming responsibility for the administration of the “National Agricultural Insurance Scheme” (NAIS) from GIC. The Government of India has officially designated AIC as the “Implementing Agency” for NAIS, which is the nation’s comprehensive crop insurance program covering various regions across the country.
Offices And Products
AIC maintains 18 regional offices located in state capitals across India. The company offers a range of agriculture and allied insurance products and schemes. A substantial portion of its business is generated through the yield-based “National Agriculture Insurance Scheme (NAIS),” the “National Crop Insurance Programme (NCIP),” and the “Weather-Based Crop Insurance Scheme (WBCIS).” Additionally, AIC has developed several in-house insurance products to meet specific needs in the market.
Rainfall Insurance Scheme for Coffee (RISC)
Coffee Rainfall insurance represents a distinctive rainfall insurance product that has been developed in collaboration with the Coffee Board, Central Coffee Research Institute, and coffee cultivators in the states of Karnataka, Kerala, and Tamil Nadu. This specialized rainfall insurance offers valuable risk management support to coffee growers who may face adverse effects due to rainfall variations.
Under this insurance, Agriculture Insurance Company of India Ltd. provides compensation to the insured parties in the event of reduced coffee output or yield caused by either a deficit or excess in actual rainfall, depending on the specific coverage options chosen. The insurance coverage is in effect from March 1 to August 31, aligning with the critical period for coffee cultivation.
Bio-fuel Tree/Plant Insurance Policy
This insurance offers named-peril coverage for six distinct plant and tree species used in the commercial production of bio-diesel. Additionally, it provides the option for policyholders to include coverage against the risk of drought.
Cardamom Plant & Yield Insurance
This scheme has been developed in collaboration with the Spices Board to offer traditional coverage against the death or loss of plant bushes. It provides coverage for both small and large cardamom varieties.
Potato Crop Insurance
This parametric named-peril insurance is tied to the population of plants and is designed for potato growers engaged in contract farming.
PulpWood Tree Insurance Policy
The policy provides protection against financial losses incurred due to the complete loss or damage of trees caused by specific perils or risks, including fire, flood, cyclone, storm, frost, pests, and diseases.
RainFall Insurance Scheme For Coffee (RISC)
Crop yield can be adversely affected by the failure of blossom showers, backing showers, and excessive rainfall during the monsoon and post-monsoon seasons. This scheme provides coverage and is implemented in all coffee-growing regions of Andhra Pradesh, Assam, Karnataka, Kerala, Mizoram, Odisha, and Tamil Nadu, with financial support from the government in the form of subsidies.
Rubber Plantation Insurance
Covers death/loss of rubber trees against natural calamities and other non preventable perils, applicable to both mature and immature plants, based on establishment cost and loss of future returns.
Varsha Bima / RainFall Insurance
This insurance covers the expected reduction in crop yield due to factors such as insufficient or excessive rainfall, prolonged dry or wet periods, and more. It is open to all categories of cultivators who may face financial losses due to unfavorable weather conditions, and they have the option to enroll in the insurance scheme. This coverage is applicable to numerous seasonal field crops.
Coconut Palm Insurance Scheme
This named peril insurance has been developed in collaboration with the Coconut Development Board (CDB). It offers coverage for coconut palms in two age groups: 4–15 years and 16–60 years, safeguarding against death caused by various perils such as Fire, Lightning, Cyclone, Storm, Flood, Pests, Widespread diseases, Earthquake, Severe Drought, and more. The pilot program is available in specific districts located in Andhra Pradesh, Goa, Karnataka, Kerala, Maharashtra, Odisha, and Tamil Nadu. The CDB offers a 50% premium subsidy, while the respective state contributes 25%, leaving the grower responsible for the remaining 25%.
Weather Insurance (RABI)
This mechanism serves as an effective tool for providing risk management support to individuals and institutions that may be affected by adverse weather events. The key advantages of Weather Index Insurance include:
1. Trigger events, such as adverse weather conditions, can be independently verified and quantified.
2. It enables prompt settlement of indemnities, often as soon as two weeks after the indemnity period.
3. Weather insurance is accessible to all types of growers, including Small/Marginal, Owners, and Tenants/Sharecroppers.
