Government-owned Agriculture Insurance Company (AIC) plans to launch crop reinsurance services abroad, particularly in other South Asian countries like Nepal, Sri Lanka, and Bangladesh and the Philippines.
The company has got approval from the Insurance Regulatory and Development Authority (IRDA) for inward insurance (reinsurance services in a foreign country). It is currently in discussions with intermediaries to launch the product by January next year, the month when most of the treaties pertaining to crop insurance are up for renewal.
“Our solvency ratio is 2.99 compared to the regulatory need of 1.5 and our capital base is over Rs 3,500 crore. Given our expertise in crop insurance, we want to be seen helping other developing countries in the area. We are well equipped to provide reinsurance support to them,” Rajeev Chaudhary, managing director and chairman of AIC, told Business Standard.
AIC was set up by the government as the sole implementing agency for its then flagship crop insurance programme, National Agricultural Insurance Scheme.
After the launch of Pradhan Mantri Fasal Bima Yojana, the domestic crop insurance market has become competitive with many private companies joining the bandwagon. However, AIC continues to enjoy a major share — around 50 per cent — in the market.
This year, the premium collection is expected to be around Rs 13,000 crore, said Chaudhary.