JBA launches insurance pricing model
A global flood risk modeller has said it is expanding its insurance pricing scheme to cover the impact of weather on crops in India, reported Press Trust of India on 24 Nov 2018.
JBA Risk Management Managing Director Iain Willis said the India Weather-Based Crop Insurance Scheme (WBCIS) is expected next year.
The WBCIS is a follow-up to the India Crop Model launched on November 13, which is based on 10,000-year probabilistic data. The Indian Crop Model facilitates risk management and (re)insurance pricing within the guidelines of the PMFBY, Willis said.
He said 70% of the crop performance is impacted by inclement weather.
Willis said the new model launch coincided with the start of rabi (winter) crop growing season and amid increasing evidence that a period of El Nino weather patterns will likely prevail from late 2018 into 2019.
“Crop simulations ran using historical climate data suggest that some major Indian rainfed crops, including soybean and groundnut, are particularly vulnerable to these changes during El Nino years and can be adversely affected,” he elaborated. The crop model through data simulation.
“To facilitate and support this vital and ambitious goal (of PMFBY), it is hugely important to have robust models in place to help assess the nature of the risk and exposure to the market,” said Tom Graham, head of Regional Treaty Development at Chaucer in Singapore.
The India Crop Model is intended for use by (re)insurances to help them the price and assess their exposures within the PMFBY India Crop Insurance Scheme. The PMFBY covers about 90 per cent of the crop insurance in India, around 70 per cent of which is for the summer (kharif) crops.
It covers some 40 million farmers while the government has a goal to cover 50 per cent of the 130 million farmers.
The scheme insures approximately Rs.200,000-250,000 crore worth of crops across India through both the Kharif and Rabi seasons. Insurance premiums represent approximately 10% of this, estimated Willis. fiinews.com
