ICICI Lombard in weather cover spread

ICICI Lombard General Insurance will nationally roll out its weather insurance product range soon.

The company had become the first insurer in the country to get approval for selling a weather-linked insurance product from the regulator in last September.

The company had recently launched a pilot project in Gujarat, Rajasthan and Madhya Pradesh to test these markets. It had earlier tested the product in Andhra Pradesh and Karnataka.

Ritesh Kumar, head, risk, ICICI Lombard, said, "The response from farmers for the pilot project was encouraging. We are designing the final product now."

ICICI Lombard may first launch the product in the markets where it has already been tested.

The index-based product, which was conceptualised in association with the World Bank, will be sold among the farmers.

The product will be sold through banks, especially co-operative banks in Maharashtra and Gujarat.

The product may be linked with the crop loan products of ICICI Bank. The company will also sell the product in bulk through state governments.

"We are at present negotiating with various state governments for selling the product in bulk. It may be sold through NGOs working for farmers. Contract farming set-ups may also be contacted," Kumar said.

The product will cover mainly three parameters - rainfall, humidity and temperature. It will also cover crops from possible threats from high wind speed depending on the territory.

Kumar said, "We will work out a very small premium. It will vary from case to case. We do not expect a very high return from this product. This is our way of showing that we care for the country's farmers."

Kumar said even after launching the product in the retail market, ICICI Lombard will keep receiving technical inputs from the World Bank.