In order to popularise crop insurance in India, the insurance regulator has permitted agents - individual and corporate - of the four government owned general insurers to sell products of the Agricultural Insurance Company (AIC).
The Insurance Regulatory and Development Authority (IRDA) Wednesday conveyed its decision to the CEOs of all the general insurance companies in India and the copy of that communication was uploaded on its website Thursday.
According to IRDA, awareness about crop insurance amongst the rural populace "is very low and as such large number of crops in India are cultivated without appropriate insurance coverage".
"Hence there is an urgent need to spread the message of crop insurance to protect farmers from unexpected risks," the IRDA said.
The regulator said the AIC is a crop insurer and there is no conflict of interest with the four government owned insurers (National Insurance, New India Assurance, Oriental Insurance and United India Insurance).
Further the four companies are the promoters of AIC and hence IRDA has decided to permit the former to market its products through the agents of four companies.
