Agriculture’s Next Leap is Tech-Driven Precision Insurance: AIC CMD

India’s farm insurance sector is entering a phase of rapid digital transformation, even as erratic weather and patchy data remain key hurdles. Government-backed platforms like Agriculture Insurance Company's (AIC) WINDS and YESTECH are beginning to bring more accuracy to yield estimates and speed up claim settlements, while drone-based and geospatial tools are helping track crop losses in real time.

Talking to FE BFSI, AIC's Chairman and Managing Director Dr Lavanya R. Mundayur says that the insurer is using these technologies to make crop insurance more transparent and accessible. AIC is also stepping up outreach under PMFBY and RWBCIS, taking policies directly to farmers and developing new climate-linked products to help them manage emerging risks. Edited excerpts:

AIC has played a crucial role in protecting farmers and strengthening India’s agricultural sector. What do you see as the most pressing challenges and opportunities for agricultural insurance in India today?

Agricultural insurance in India is at a defining stage. While climate variability and data gaps remain pressing challenges, technology has opened extraordinary opportunities for scale, transparency, and precision. The future lies in integrating real-time satellite analytics, weather data, and tech-based yield assessment to ensure that insurance products evolve dynamically with climatic and market realities. 

AIC is working closely with the government’s digital infrastructure initiatives such as WINDS (Weather Information Network Data Systems) and YESTECH (Yield Estimation System based on Technology) to strengthen the scientific backbone of agricultural insurance. These platforms allow us to bring consistency and objectivity into yield estimation and weather-triggered claims, thereby reducing disputes and ensuring faster settlements.

How is AIC leveraging technology and data analytics to enhance risk management, claim processing, and customer service for India’s farmers?

Technology is at the heart of AIC’s transformation. Our in-house developed SEWANxT platform now handles end-to-end underwriting, claim accounting, and reconciliation across all schemes. Through API integrations with the government’s National Crop Insurance Portal (NCIP), we will create a seamless digital value chain right from enrolment to settlement.

On the risk management side, AIC uses the Geospatial Crop Monitoring System (GCMS) and Remote Sensing Technologies (RST) to generate fortnightly crop condition reports and yield estimations. The CHANDRA TECH drone project in Madhya Pradesh has proven the potential of drone-based farm-level analytics for yield verification and extreme weather loss assessments.

As far as claim automation is concerned, the government’s Digiclaim module has brought a revolutionary change wherein claims under PMFBY & RWBCIS are automatically calculated and transferred directly into farmers' account with the click of a button.

For the company's in-house agri-insurance products, we have developed an in-house application called SARUS, through which the entire process, from underwriting to claims, is paperless.

Also read: Insurance growth, Profitability Under Strain; Sector Trailing Pace Needed for Viksit Bharat: Report

Inclusivity has been a key theme in your recent initiatives. How is AIC working to extend insurance coverage to small and marginal farmers, and what more needs to be done for last-mile financial inclusion?

Inclusivity is both our mission and measure of success at AIC. As the leading implementing insurance company of the government’s flagship schemes Pradhan Mantri Fasal Bima Yojana (PMFBY) and the Restructured Weather Based Crop Insurance Scheme (RWBCIS), we are committed to ensuring that every farmer, especially small and marginal ones, has access to reliable and affordable risk protection. Both these schemes are designed for all farmers across India, with the government providing a substantial subsidy on premiums, making the coverage highly affordable.

During the first half of the current year, AIC has conducted over 65,000 IEC activities, including Fasal Bima Pathshalas, workshops, and capacity-building programmes under various government campaigns to create awareness and strengthen last-mile engagement. Under the Meri Policy Mere Hath (MPMH) initiative, we will be distributing around 2 crore policies for Kharif 2025 directly at the farmers’ doorsteps, ensuring that every insured farmer receives their policy documents in person. 

This mega policy distribution drive will not only ensure that farmers will get their insurance policy but it will also be complemented with awareness workshops with farmers, wherein the AIC representative will directly interact will farmers and ensure that all their doubts/queries are clarified on the spot.

We’re also empowering POSPs, CSCs, and micro-intermediaries with our Capacity Building initiatives. For states not currently implementing central government schemes, AIC is developing customized insurance products tailored to their regional crop and climatic conditions, ensuring that no farmer is left unprotected.

The agricultural sector is deeply affected by climate change and resource vulnerabilities. How is AIC preparing to support farmers in adapting to these new risks?

AIC is developing various in-house agri-insurance products around climate resilience. We are developing parametric and weather-index-based solutions that can provide quicker relief during floods, droughts, or temperature anomalies. Our Geospatial Crop Monitoring System (GCMS) now integrates data from IMD and remote sensing satellites. This enables AIC to monitor rainfall deficits, drought patterns, and crop stress in near real time.

Our CHANDRA TECH project uses drone-based analytics to assess crop health, classify damage, and validate yield data at the farm-plot level. Such high-resolution imagery helps us move toward evidence-based, objective loss assessment.

Also read: India’s Gold Loan Boom: While Borrowers Win, Lenders Must Weigh Risks

You have extensive experience working in international markets. What lessons from your global insurance leadership are you applying to your work at AIC?

My experience across international insurance markets has deeply shaped my approach to leadership at AIC. Working in diverse environments from structured global reinsurance systems to emerging microinsurance models in developing economies taught me that the real strength of an insurer lies in data discipline, customer trust, and technological agility.

In mature markets, success comes from precision and predictability, every risk is backed by analytics, and every process by automation. In developing markets, the focus shifts to access and adaptability designing products that can reach the underserved efficiently. At AIC, I’ve sought to blend these two philosophies.

We are building globally benchmarked systems like SEWANxT for digital underwriting and claims automation, and expanding the use of satellite analytics, and data modelling in crop assessment and pricing. 

Looking ahead, what do you see as the next big transformation for agricultural insurance in India and how is AIC positioned to lead this change?

The next transformation will be Technology-led precision insurance, where claims, pricing, and advisories are all data-driven and instant. AIC’s roadmap includes expanding drone analytics, cadastral data integration, and machine learning yield models within our Field Risk Management (FRM) system.

Automation of every workflow from underwriting to claims through SEWANxT, GCMS, and SARUS will make AIC a truly digital insurer.