The working group on risk management in
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| (c) Levels of Indemnity: At present, the levels of indemnity are 60%, 80% or 90% corresponding to high, medium low risk areas. It is perceived that the 60% indemnity level, does not adequately cover risk, especially in the case of small / medium intensity adversities, as losses get covered only if and when, the loss exceeds 40%. The Joint Group has proposed only two levels of Indemnity, viz. 80% & 90% instead of the existing 3 levels, viz. 60% (high risk, medium risk) and 90% (low risk). The Working Group feels that the suggestion of the Joint Group is reasonable, but, these higher levels of indemnity may escalate premium rates, and thus, increase the subsidy burden of the government. In view of this, it maybe wise, to continue with the three levels, while upgrading 60% to 70%. Since, the majority of crops are presently under the 60% level, its up-gradation to 70%, is a reasonable improvement, particularly, when seen along with other improvements like lowering the Insurance Unit (IU), changes in threshold calculation, etc. Download 0.68 Mb. Share with your friends:
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