Lombard pays compensation

ICICI Lombard General Insurance, which pioneered the weather insurance scheme for orange growers in the Jhalawar, Kota, and Baran districts of Rajasthan earlier during the year, compensated Rs 274,972 to its policy holders.

This innovative weather insurance scheme allows farmers to be recompensed on the basis of rainfall data provided by the meteorological department. There is no need to file a claim, give documents, or wait for any survey results. This has enabled ICICI Lombard to make the claim payout to the farmer within a very short period.

The scheme was launched with the support of the government of Rajasthan to provide coverage against shortages of rainfall during the period from June 16 to September 23.

Seven hundred and eighty-two farmers, constituting nearly 7 per cent of the total orange cultivators in the region, had subscribed to the scheme. The scheme provided a cover for Rs 184 crore, equivalent to the output of 613 acres (one acre is 4,840 square yards) of arca under orange cultivation.

Orange trees are vulnerable to dry spells during the flowering period between July and September. This period can be further divided into six phases, and each phase requires a certain minimum amount of rainfall, pegged at 30 mm. ICICI Lombard had promised to pay compensation due at the end of the third phase and the sixth and final phases.

The Jhalawar meteorological station recorded 155.8 mm of rainfall during the first phase, 49 mm during the second phase, and 25 mm of rainfall during the third phase. As per the policy, ICICI Lombard compensated the farmers for this shortfall during the third phase.

Smita Aggarwal, head of rural and agriculture business at ICICI Lombard, said, "We are sensitive to the losses farmers had to incur due to unfavourable weather conditions for orange cultivation this season, and are happy to be able to provide compensation to them under the terms of the policy even before the expiry of policy term. Our unique weather insurance policy covers farmers for the shortfall in rainfall at each stage of growth of the orange crop. Moreover the farmer does not need to go through any lengthy claim process, submit any documents, or wait for a survey to be done before the claim is paid."