Revenue Insurance Scheme for Plantation Crops (RISPC)

The Revenue Insurance Scheme for Plantation Crops (RISPC) is launched by the Department of Commerce to protect growers of tea, rubber, coffee, cardamom and tobacco from risks of weather and price. These effects gradually lead to income loss caused by fall in domestic/international prices through crop insurance mechanism.

Coverage of the Scheme

Insurance premium subvention under RISPC applies to small growers of tea, rubber, coffee (Robusta and Arabia), tobacco and cardamon having 10 hectares or less landholding. The scheme is applicable only to mature standing crops.
The Scheme is compulsory for those growers registered with the concerned Commodity Boards (CBs) in the pilot districts/member growers to avail the benefits of other Government schemes through the said board. The growers can avail loans from public financial institutions/bodies including CBs. The project is optional for other small growers. Large growers can also participate in the project by paying the actuarial premium as they not eligible for the premium subsidy.
The scheme is implemented initially in eight selected district of seven states. The total number of small growers ensured to be covered is around 1.8 lakhs, with an all area coverage of about 2.10 lakh hectare.
The scheme operates with the principle 'Area Approach' in certain districts. Commodity Board along with the concerned State Government designates an area as Insurance Unit (IU) that could be a village, village panchayat or any equivalent unit.
The scheme covers income loss that arises from yield loss/price fluctuation. Yield loss is caused due to non-preventable risks such as drought, dry spells, inundation, flood, pest, and diseases, landslides, lightning, storm, hailstorm, natural fire, cyclone, etc. Price fluctuations are due to fall in international/domestic prices below an average price of the last five years, excluding the current year.
Losses that arise from war and nuclear risks, malicious damage, and other preventable risks are excluded.

Summoning of Meeting

Prior to two months of the commencement of the crop season, Commodity Boards along with the respective State Government summons a meeting to all stakeholders to finalize the issuance of bid notice, terms and conditions and designates insurance companies to carry out the implementation of the scheme during the insurance period.

Publicity

Adequate publicity would be given in all villages of the pilot districts through electronic and print media, grower's fair, exhibitions, SMS, short films, documentaries, etc. The Commodity Boards, along with Insurance Companies and concerned State Government organizes training/workshops/sensitization programs.

Provision of Yield

Commodity Board provides five years of authentic historical yield, and price date to Insurance Companies for calculation of indemnity limits and premium rates for insurance units. If there is no data available, the data at the next higher group/weighted average of continuous units would be granted. Standard yield estimation is finalized after consulting with IASRI and NSSO during the pilot period. Assurance of the calculated sum insured is not below 80%, which is fixed by the concerned Commodity Board. The average yield of insured crop in the Insurance Unit is taken as equal to the average yield of the last five years, excluding the present year. The Average Income is cover to the Average yield (per ha of last 5 years) X Average price (Rs. per hectare of last 5 years). The sum insured for the crop is the average income of the past five years multiplied by the applicable indemnity level of that crop.

Rate of Insurance Premium

The rate of insurance premium that is paid by the Government of India, State Government and growers is in the ratio of 75:15:10. The share of premium by growers increases if the State Government in the area/region covered by the scheme does not contribute its premium share.

Circulation of Details

Commodity Board along with the State Government ensures the circulation of the required details on insured crops, areas, sum, insured, premium rates for farmers, Government subsidy, seasonality discipline for every activity, to every concerned agency/departments for at least one month in advance of the commencement of the crop season. This is done digitally and then uploaded on the website of the Boards, State Governments, and Insurance Companies.

Seasonability Discipline

Commodity Boards provides seasonability discipline for the following.

- Submission of insurance proposals by growers to bank branches/Regional offices of Commodity Boards/PACS etc.
- Submission of consolidated proposals by the Regional Offices of Commodity Boards/Primary Agriculture Societies (PACS)/Bank branches to Commodity Boards/Nodal banks.
- The submission of consolidated proposals to Insurance Companies by the Commodity boards/Nodal banks.
- Submission of consolidated proposals to the Insurance Companies by either the Commodity Boards/Nodal banks.
- Submission of price data/yield by the Commodity Boards to the concerned Insurance Companies.
- Crediting of legal claims to growers account by bank branches/PACS.
- Submit the list of insured growers in the notice board of the bank branch/PACS in both digital and manual format.
- Upload details of beneficiaries on their website of the Commodity Board and Insurance Companies.

Receiving Proposals

Regional Offices/Designated Agencies of Commodity Board/branches of designated Commercial Banks/Regional Rural Banks (RRBs)/Primary Agriculture Cooperative Societies (PACS) would be receiving proposals from the growers. Insurance Company also avails the service of Insurance Regulatory and Development Authority of India (IRDA) approved Insurance Intermediaries/Insurance Agents for the coverage of non-loanee growers.

Disbursement

Disputed claims/substandard claims have to be informed to the Commodity Boards within three months of claim disbursement for consideration and decision. All claims have to be settled within three weeks from the filing date of receipt of yield/price data from the Commodity Board. However, the relaxation in file cut-off date is granted/considered after it is fixed by the Commodity Board for a crop season.