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|Agriculture Insurance Company of India Ltd. (AIC)||By A Special Correspondent|
Agriculture Insurance Company of India Limited (AIC), a specialty general insurer, was incorporated in December 2002 and started its operations in April 2003. The creation of the Company can be attributed to the announcement made by the then Union Finance Minister in his Budget Speech FY-2002-03. The motto was to set up an Organization to exclusively cater to the insurance needs of the farming community. Since then the Company has been undertaking efforts to maximize crop insurance penetration level. The company during 2010-11 is estimated to insure over 40 million hectares of cropped area grown by about 30 million farmers under its two flagship products, viz. National Agricultural Insurance Scheme (NAIS) and Weather Based Crop Insurance Scheme (WBCIS). The efforts of the Company have made it reap the rewards like “INNOVATION OF THE YEAR AWARD” for 2008 at 12th Asia Insurance Awards Ceremony. The company is regarded both at national and international level as the pioneer of many innovative and creative insurance concepts.
AIC has a focused attention to address the insurance needs of the Indian farmers for a financial insulation in the event of crop losses occurring due to natural calamities. The crop insurance schemes of AIC are farmer-friendly and rooted in ground realities. The different schemes/products are designed to allow all cultivators either landed or landless, including sharecroppers or tenant farmers to avail insurance coverage.
Stakeholders and financial:
• GIC (35%), NABARD (30%) and NIA, NIC, OIC & UIIC (8.75% each)
• Authorized Share Capital – Rs. 1500 crore
• Paid-up Share Capital – Rs. 200 crore
• 2-Tier structure of Corporate Office and Regional Offices--17 Regional Offices as on date
• Approx 200 technically qualified and experienced manpower
The year 2009-10 is of special significance in the history of AIC as the Gross Direct Premium (GDP) during 2009-10 has touched 4-digit figure and closed at Rs. 1520.40 crore, as against Rs. 833.44 crore during the previous year, registering an accretion of Rs.686.96 crore, the Growth Rate being 82.42%. During 2010-11 the company is expected to write a premium of around Rs. 2000 crore.
AIC has been designated by the Government of India as its sole “Implementing Agency” for implementing Government sponsored National Agricultural Insurance Scheme (NAIS). Apart from NAIS, two other government schemes, viz. Weather Based Crop Insurance Scheme (WBCIS) and Modified National Agricultural Insurance Scheme (MNAIS) are being implemented on pilot basis by AIC along with a few private insurers. Crop insurance products emerge out of generic as well as specific risks in the entire agricultural process. At AIC, the development of a crop insurance product is done through extensive research and analysis. AIC’s products are rural oriented thus the Company is well acquainted with the difficulties in reaching out to difficult geographies of rural markets and the high cost of distribution. The basket of AIC’s product includes, besides the above schemes, the following –
1. Varsha Bima
2. Rainfall Insurance
3. Potato Insurance
4. Mango Insurance
5. Generic Weather Insurance(Rabi)
6. Coffee Insurance
7. Bio-fuel tree/plant insurance
8. Coconut Palm Insurance
9. Rubber Plantation Insurance
10. Apple Insurance
11. Grapes Insurance
AIC has a very lean structure both in terms of the cadre strength of employees and the number of offices. Despite this, AIC has been able to reach out to the vast farming community by closely working with the large banking network as its last-mile contact point. To improve efficiencies in business and administrative processes as also to reduce costs of operations, AIC has embarked on a holistic web-enabled Infotech systems solutions project. By the end of the current Five Year Plan ending 2011-12, the Company would like to introduce innovative insurance delivery mechanism including internet / online marketing.
All the efforts at AIC are directed at ensuring that the benefits of crop insurance schemes actually reach the farmers in distress. This is ensured by payment of claims directly to the accounts of farmers through the banking system. The Company is trying to bring the benefits of financial inclusion to every Indian Farmer. In the same vein, it is looking at a comprehensive package that includes farmers' huts, tools, implements, animals besides crops – subject to necessary approval of the authorities concerned.
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