Agriculture Insurance Set for Growth with Boost in Technological Advancements

The agriculture insurance sector is projected to grow from 2024, with an average real premium increase of 2.5%. Despite flat growth in FY23 due to lower premium rates in the Kharif season, the increase in insured land and farmer enrolments offset the decline. Government initiatives are enhancing insurance infrastructure and accessibility.

The agriculture insurance sector is poised for growth starting in 2024, with an expected average real premium increase of 2.5% over the medium term, according to the Economic Survey 2023-24.

The survey, presented in Parliament on Monday, indicated that the sector, which makes up about 12% of the non-life insurance market, saw flat growth in FY23. This was primarily due to a significant drop in premium rates during the Kharif cropping season. Despite this, the decline was countered by a rise in insured land area and farmer enrollments during the season.

The survey noted, "Agriculture premiums will likely rise from 2024 onwards, with an average real premium growth of 2.5% over the medium term, supported by improvements in insurance infrastructure such as mobile applications and remote sensing for crop loss monitoring." In response to current crop insurance challenges, the government has introduced several technological initiatives, including the YES-Tech Manual, WINDS portal, and enrollment app AIDE/Sahayak for satellite-based crop damage assessment.

Additionally, the survey highlighted door-to-door enrollment drives aimed at increasing farmers' access to crop insurance. These measures are anticipated to enhance the efficiency of crop damage assessment and improve the overall accessibility of agricultural insurance in India. Currently, the government's efforts include implementing Pradhan Mantri Fasal Bima Yojana and the Weather Based Crop Insurance Scheme.