Crop insurance is one of the most important types of insurance products in the country today. This is especially due to the fact that more than half of the country’s workforce is employed in the agricultural sector. Agriculture also contributes significantly to the nation’s GDP.
Yet, farmers face a lot of risks in the various processes of agriculture. As a result, they need some form of protection. This is where crop insurance can step in to help. Crop insurance helps stabilize the income of farmers while also promoting the use of improved technology in farming. This form of insurance really provides tremendous support to the agricultural sector in the country and safeguards it from many hazards.
In this article, we will take a look at 3 major reasons why crop insurance is so important.
1.Protects against losses due to natural hazards
Unpredictable natural hazards pose a huge risk to the agricultural sector. Some of the major risks to crops come from natural hazards such as flood and inundation, landslides, fires due to natural causes, lightning, hailstorm, and cyclones. Droughts also pose a huge risk. These natural disasters can lead to major losses for farmers. Crop insurance helps farmers stay protected against losses arising from natural calamities so that they can get reimbursed for damages incurred. This gives farmers a deep sense of security as natural calamities cannot be prevente
2.Protection from damages due to pests and disease
Apart from natural calamities, agricultural products also face risks due to plant diseases and pests.Pests such as locusts can destroy growing crops and cause huge losses for farmers. Crop insurance offers a payout to farmers who face losses due to crops impacted by disease and pests so that they can be compensated. Quite often, risks from disease and pests are non-preventable – our farmers definitely need financial protection from such circumstances.
3.Implementation of modern agricultural practices
The financial protection offered by insurance encourages farmers to adopt newer and more modern technologies in agricultural production. The knowledge that crop insurance is there to support them can help farmers apply new and innovative technology that will lead to much higher yields. This will increase healthy competition in the agricultural sector and also ensure stability of income.
Pradhan MantriFasalBimaYojana (PMFBY)
The Pradhan MantriFasalBimaYojana (PMFBY) is a crop insurance scheme launched in India in 2016. Its aim is to provide holistic and affordable crop insurance for farmers in the country. Under PMFBY, farmers receive protection against losses due to prevented sowing, post-harvest losses, mid-season adversity, and localized calamities. The coverage extends to food grain crops, oilseed crops, commercial crops, and horticultural crops. The goal of PMFBY is to ensure that crop insurance manages to offer protection for the totality of sown area in the country
We hope that this article has helped improve your understanding of crop insurance and the reasons for its importance in our country. Take care.