Rainfall Insurance Scheme – Coffee (RISC)
Rainfall Insurance Scheme – Coffee (RISC) is a unique rainfall insurance product specially designed for the coffee growers of Karnataka, Kerala and Tamilnadu. This product is designed in consultation with Coffee Board, Central Coffee Research Institute and the Coffee Growers of these states. RISC is expected to provide effective risk management aid to those coffee growers likely to be impacted by adverse rainfall incidence.
The most important benefits of RISC are:
- Trigger events like adverse rainfall can be independently verified and measured.
- Parameters considered in designing this insurance product are relevant, appropriate and to a large extent captures the rainfall induced risks affecting Coffee production.
- Allows for speedy settlement of indemnities, within 45 days after the indemnity period.
Scope of Coverage
The policy compensates the insured, against the likelihood of diminished coffee output / yield resulting from shortfall / excess in the actual rainfall (as the case may be) for different coverage options within a specific geographical location and specified time period, subject to a maximum of the Sum Insured specified in the policy under each of the coverage options.
The policy provides the following coverage options:
“Blossom Showers” shall mean the rainfall received between 1st March to 15th April (Robusta) and 1st March to 30th April (Arabica) for the bud to flower (bud enlargement and anthesis). The normal requirement of rainfall is a sum of 25 mm over seven consecutive days.
“Backing Showers” shall mean the rainfall received from 18th day of the starting of Blossom Showers till 40th day to achieve fruit development & retention. The normal requirement of rainfall is a sum of 12 mm over two consecutive days.
“Monsoon Showers” shall mean the rainfall received during 1st July to 31st August for the fruit to grow in size. However, in case of Kerala the period is from 1st June to 31st August; and for the zones in Tamilnadu receiving rainfall during North-East Monsoon, it’s from 1st October to 30th November. The rainfall within normal range is beneficial for early ripening and maturity. The aggregate rainfall beyond a specified limit (distinct for each zone) over any seven consecutive days during the period is likely to adversely affect the coffee yield.
Period of Insurance
The insurance operates during 1st March to 31st August / 30th November. The periods under different coverage are as follows:
i. Blossom Shower: 1st March to 15th April (Robusta) / 30th April (Arabica)
ii. Backing Shower: 18th day of from the starting of Blossom Showers till 40th day
iii. Monsoon Shower: 1st June / 1st July to 31st August; 1st October to 30th November
Any coffee grower, cultivating Robusta / Arabica variety of coffee in the selected zones of Karnataka, Kerala and Tamilnadu and whose coffee produce / yield is likely to be affected by the rainfall, are eligible to buy the insurance.
How claims become payable
In the event that, in the geographical location (coffee zone) and during the time period specified in the Schedule to this policy for different options, the Actual Rainfall is deficit / excess compared to the specified trigger level, the benefit payable to the insured shall be a sum specified corresponding to the trigger level, subject to maximum of the Sum Insured specified under various options of the Scheme.
Claims are automated; and will be settled on the basis of actual rainfall data received from the concerned agencies/ institutions. Claims when become payable, will be paid at a uniform rate to all the insured growers with in the Coffee Zone growing a particular variety of coffee. Claims are directly credited to the Bank account of the insured grower, as specified in the proposal form.
The insured shall be required to furnish the copy of the cover note / confirmation certificate as a proof of insurance and any other document / proof specifically requested by Agriculture Insurance Company of India Limited (AIC) for the settlement of the claim.
Maximum sum insured per hectare for Robusta and Arabica varieties shall be Rs. 20,000 and Rs. 30,000 respectively. This is the maximum indemnity that AIC will pay in all under each cover note / policy. The phase-wise break-up is as follows:
Premium chargeable would be statistically/actuarially calculated based on the type of coffee crop, location, the coverage sought, the past rainfall pattern in the specified geographical area and the acreage under cultivation. Those growers who may buy all three phases would save on the premium.
Coffee Board is extending premium subsidy upto 50% of premium for growers with plantation size upto 10 hectares. The subsidy is as follows:
Subsidy (per Hectare)
Subsidy (per Hectare)
50% of the premium amount subject to a ceiling of Rs.2500
50% of the premium amount subject to a ceiling of Rs.2000
How to avail insurance
Authorized Agents / Insurance Intermediaries / Representatives of Agriculture Insurance Company of India Ltd. (AIC) are available at the Office of Junior / Senior Liaison Officer (J/ SLO) of Coffee Board in every Coffee Zone in the States of Karnataka, Kerala & Tamilnadu to collect proposal form & premium. These personnel would also help the growers in providing and filling up insurance proposals. Premium net off subsidy may be paid through ‘Account Payable’ cheque drawn in favor of Agriculture Insurance Company (AIC).