A STUDY OF AWARENESS OF LIVE, STOCK INSURANCE AMONG THE PEOPLE OF DOMBIVALI

THE S.I.A COLLEGE OF HIGHER EDUCATION

AFFILIATED TO UNIVERSITY OF MUMBAIRE-ACCREDITED B+BY NACC
P-88MIDC RESIDENTAL AREA DOMBIVLI GYMKHANA ROAD,
NEAR BALAJI MANDIR, DOMBIVLI (EAST), 421203.

SEMESTER VI
(2023-2024)
By

MR. Durgesh Harendra Dubey.

(Roll No. BF22058)

Under the Guidance of

Mrs. Renu Verma.

Name of the Learner

MR. Durgesh Harendra Dubey.
(Roll No. BF22058)

Name of the Guiding Teacher

Mrs. Renu Verma.

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CERTIFICATE (2023-2024)

This is to certify that MR. DURGESH HARENDRA DUBEY Seat No.....Of B.com
(Banking & Insurance) Semester VI (2019-2020) has successfully completed
the project on A STUDY OF AWARENESS OF LIVE , STOCK
INSURANCE
AMONG THE PEOPLE OF DOMBIIVLI(W) under the guidance of Mrs.
Renu Verma.

Date:- Place:-

(Prof. Dr. Padmaja Arvind)

Course Coordinator
principal

(Mrs. Renu Verma)

Project Guide / Internal

Examiner External examiner
DECLARATION

I the undersigned MR. DURGESH HARENDRA DUBEY here by, declare that the
work embodied in this project work titled ‘‘A STUDY OF AWARENESS OF
LIVESTOCK INSURANCE AMONG THE PEOPLE OF DOMBIIVLI (W)’’
my
own contribution to the research work carried out under the guidance of Mrs. TANYA
AHUJA is a result of my own research work and has not been previously submitted to
any other University for any other Degree to this or any other University. Wherever
reference has been made to previous works of others, it has been clearly indicated as
such and included in the bibliography. I, here by further declare that all information
of

2
this document has been obtained and presented in accordance with academic
rules and ethical conduct.

Signature of student
DURGESH HARENDRA DUBEY

3
 ACKNOWLEDGEMENT

To List who all have helped me in Difficult because they are so numerous and the depth is so
enormous.

I would like to acknowledge the following as being idealistic channels and fresh dimensions
in the completion of this project.

I take this opportunity to thank the University Of Mumbai for giving me chance to do this
project.

I would like to thank my principal, Dr. Padmaja Arvind for providing the necessary facilities
required for completion of this project.

I take this opportunity to thank our Co-Ordinator, Mrs. Renu Verma for her moral support
and guidance.

I would also like to express my sincere gratitude towards my project guide Mrs. Renu Verma
Whose guidance and care made the project Successful.

I would like to thank my College Library, for having provided various reference books
and magazines related to my project.

9Lastly, I would like to thank each and every person who directly or indirectly helped me in
the completion of the project especially My Parents and Peers who supported me throughout
my project

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EXECUTIVE SUMMARY

Livestock animals meet a variety of human needs. They are important sources of
transport, draft power, fiber, hides, fertilizer, fuel, and nutritional protein in the form
of meat, milk, eggs, and processed products, such as cheese. Livestock insurance
covers and protects your animals from the unexpected. Whether on the farm, ranch or
in transit, your animals are considered your personal property. If something were to
happen to them due to a covered loss, we’ll help cover the cost to remedy the issue.
The Importance of Livestock for the World Agriculture is one of the oldest sciences,
and one of the most important. Without a firm understanding of agriculture, all
humans would struggle to find enough food, shelter, and clothing to survive. Through
this research, we tried to emphasize the understanding of animal husbandry insurance
by referring to prepared questioners and some qualitative information about animal
husbandry insurance. In Maharashtra and found the majority of the respondents
(82.67%) considered information on insurance, agencies and insurance schemes for
livestock in AQUA as ‘most appropriate’ need in Warn a Wired Village project.

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 INDEX

SR., NO CONTENT PAGE

NO
CHAPTER 1 INTRODUCTION 8-41

CHAPTER 2 DATA ANALYSIS INTERPRETATION & 42-54

PRESENTATION
CHAPTER 3 CONCLUSION & SUGGESTION 55-57

CHAPTER 4 BIBLIOGRAPHY & APPENDIX 58

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 CHAPTER 01 INTRODUCTION

SR.NO CONTENT PAGE NO

1.1 INTRODUCTION OF INSURANCE 8-9
1.2 DEFINATION OF INSURANCE 10
1.3 NEED OF INSURANCE 11
1.4 INTRODUCTION OF LIVESTOCK 12-13
1.5 IMPORTANCE OF LIVESTOCK 14
1.6 CONTRIBUTION OF LIVESTOCK TO PEOPLES 15-16
1.7 ROLE OF LIVESTOCK IN FARMERS ECONOMY 17
1.8 LIVESTOCK POPULLATION DATA (2019 18
CENSUS)
1.9 PRODUCTION OF LIVESTOCK IN INDIA (2017-18) 19
1.10 INDIAN LIVESTOCK AND CLIMATE CHANGE 20
1.11 INTRODUCTION OF LIVESTOCK INSURANCE 21
1.12 IMPORTANCE OF LIVESTOCK INSURANCE 22-23
1.13 ADVANTAGES OF LIVESTOCK INSURANCE 24-27
1.14 PROCEDURE OF CLAIM UNDER LIVESTOCK 28 INSURANCE
SCHEME

1.15 TRANSFORMING LIVESTOCK INSURANCE IN A 29

CHANGING MARKET
1.16 INVESTMENT CREDIT AND INSURANCE 30
1.17 SITUATION IN INDIA STATES RELATED TO 31-32
LIVESTOCK INSURANCE
1.18 TYPES OF LIVESTOCK INSURANCE 33
1.18.1 CATTLE INSURANCE 33-37 1.18.2 SHEEP INSURANCE
38-40
1.18.3 POULTRY INSURANCE 41-44

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 1.1 INTRODUCTION OF INSURANCE

Introduction In one form or another, we all own INSURANCE whether it's auto, medical,
liability, disability or life, insurance serves as an excellent risk-management and wealth
preservation tool. Having the right kind of insurance is a critical component of any good
financial plan. While most of us own insurance, many of us don't understand what it is or
how it works. In this tutorial, we'll review the basics of insurance and how it works, then take
you through the LIVESTOCK INSURANCE out there.

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Insurance is a means of protection from financial loss. It is a form of risk
management, primarily used to hedge against the risk of a contingent or uncertain
loss.

An entity which provides insurance is known as an insurer, an insurance company, an

insurance carrier or an underwriter. A person or entity who buys insurance is known as an
insured or as a policyholder. The insurance transaction involves the insured assuming a
guaranteed and known - relatively small - loss in the form of payment to the insurer in
exchange for the insurer's promise to compensate the insured in the event of a covered loss.
The loss may or may not be financial, but it must be reducible to financial terms, and usually
involves something in which the insured has an insurable interest established by ownership,
possession, or pre-existing relationship.

The insured receives a contract, called the insurance policy, which details the conditions and
circumstances under which the insurer will compensate the insured. The amount of money
charged by the insurer to the policyholder for the coverage set forth in the insurance policy is
called the premium. If the insured experiences a loss which is potentially covered by the
insurance policy, the insured submits a claim to the insurer for processing by a claims
adjuster. The insurer may hedge its own risk by taking out reinsurance, whereby another
insurance company agrees to carry some of the risks, especially if the primary insurer deems
the risk too large for it to carry

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 1.2 DEFINITION OF INSURANCE

Different authors/authorities have defined the term ‘Insurance’ differently.

Ghosh and Agarwal

Insurance is a co-operative form of distributing a certain risk over a group of persons who
are exposed to it.

Mowbray and Blan Chard

Insurance is a social device for eliminating or reducing the cost to society of certain types of
risk.

Dictionary of Business and Finance

Insurance is a form of contract or agreement under which one party agrees in return for a
consideration to pay an agreed amount of money to another party to make good for a loss,
damage, or injury to something of value in which the insured has a pecuniary interest as a
result of some uncertain events.

Allen Z : Mayerson

Insurance is a device for the transfer to an insurer certain risks of economic loss that would
otherwise come to the insured.

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 1.3 NEED OF INSURANCE

Insurance plans are beneficial to anyone looking to protect their family, assets/property
and themselves from financial risk/losses:
Insurance plans will help you pay for medical emergencies, hospitalisation, contraction
of any illnesses and treatment, and medical care required in the future.

The financial loss to the family due to the unfortunate death of the sole earner can be
covered by insurance plans. The family can also repay any debts like home loans or
other debts which the person insured may have incurred in his/her lifetime

Insurance plans will help your family maintain their standard of living in case you are not
around in the future. This will help them cover the costs of running the household
through the insurance lump sum payout. The insurance money will give your family
some much- needed breathing space along with coverage for all expenditure in case of
death/accident/medical emergency of the policyholder

Insurance plans will help in protecting the future of your child in terms of his/her
education. They will make sure that your children are financially secured while
pursuing their dreams and ambitions without any compromises, even when you are
not around

Many insurance plans come with savings and investment schemes along with regular
coverage. These help in building wealth/savings for the future through regular
investments. You pay premiums regularly and a portion of the same goes towards
life coverage while the other portion goes towards either a savings plan or
investment plan, whichever you choose based on your future goals and needs

Insurance helps protect your home in the event of any unforeseen calamity or damage.
Your home insurance plan will help you get coverage for damages to your home and
pay for the cost of repairs or rebuilding, whichever is needed. If you have coverage for
valuables and items inside the house, then you can purchase replacement items with the
insurance money
 1.4 INTRODUCTION OF LIVE STOCK

Livestock contribute towards the livelihood of the poor by supporting subsistence

consumption at household level, providing with complementary cropping activities,
buffering against seasonality in income from other income generation activities and
providing some assets for insurance against un predictable demands for cash (Dorward et al.
2009). Livestock is an integral part of the livelihood of India’s rural population. It
contributes significantly to the overall output of the country’s agricultural industry.

Farming in India depends to a large degree on the vagaries of monsoon. If the rains fail, crops
wither. Livestock plays a crucial role in mitigating that risk. It provides alternative
employment – especially for women and income opportunities. As the critical mechanism to
cope with crop failure, it helps generate assets and bolsters the financial security of rural
Indian farmers, many of whom are among the poorest people in the country. During the last
two decades, population growth, aberrant monsoon due to climate change, restrictions on
land use, deforestation, cash crop plantation by big farmers, decreased land availability, sharp
rise in land prices and industrialisation promoted through globalisation forced the farmers to
shift to intensive farming system from the traditional free-range system (Bala Ravi2004). The
intensive rearing of livestock led to higher incidences of diseases and involvement of high
feed cost due to stallfed system.
Decrease in green and dry fodder availability from village common land and nearby forest
areas with increased incidences of foot and mouth disease (FMD), pleuropneumonia, Peste

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des petits ruminants (PPR), avian influenza and anthrax enhanced the risk in commercial
livestock production activities resulting in decline in native livestock population
(FARD2007).

Fischer and Buchenrieder, 2009 established the fact that the absence of livestock insurance
threatened the long-term livelihood of small farmers by increasing the vulnerability to acute
financial loss in the mountainous regions of Northern Vietnam. A comprehensive study by
Perry and Grace, 2009 highlighted the complex relationships among ‘livestock, livestock
disease, livestock disease control and global poverty’ and concluded that livestock diseases
affected poverty reduction. This signifies the introduction of sophisticated risk management
mechanisms for sustainable livelihood of farmers in the above scenario.

Lack of proper animal husbandry extension support with veterinary healthcare services and
risk minimisation options such as livestock insurance limited the livelihood options of
farm households adversely affecting dietary diversity, food security and income
generation.
Limited availability of organic manure from the decreasing livestock population, use of dry
cattle dung as fuel for cooking due to diminishing availability of firewood, non-affordability
for use of alternate sources of energy as fuel for domestic purposes, high cost and scarcity
of inorganic fertilizers, threatened sustainable agriculture and soil health status in most of
livestock farming areas of country.
1.5 Importance of Livestock

While livestock contributes to the nutritional diet and food security of the people, the growth
of the sector in different states is very uneven. Accelerating growth in the Punjab, Haryana
and Gujarat regions is in stark contrast to states like Odisha, which lags behind. The
divergence is due to the policy focus of different state governments. Depending on the
incentives and infrastructure provided by the states, the sector grows or stalls.

Developing this sector in a country where 250 million people or 51% of the total employed
population works in agriculture is crucial. In a country that still faces rising population
numbers the livestock raising industry can potentially provide work for many, assure food
security and generate additional income – a cornerstone for further development and
economic growth.

Nearly 60% of rural households have livestock as an integral part of their farming system.
About 69% of women are engaged in this sector. This sector contributes 26% to agricultural
GDP. According to latest 19th Census, the livestock population stands at 512 million in India.

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 1.6 Contribution of livestock to people

The livestock provides food and non-food items to the people.

1. Food: The livestock provides food items such as Milk, Meat and Eggs for human
consumption. India is number one milk producer in the world. It is producing
about
176.34 million tones of milk in a year (2017-18). Similarly it is producing about
95.22 billions of eggs, 7.70 million tonnes of meat in a year. The value of output of
livestock sector at current prices was Rs 9,17,910 crores at current prices during
2016-17 which is about 31.25% of the value of output from agricultural and allied
sector. At constant prices the value of output from livestock was about 31.11% of the
value of the output from total agriculture and alliedsector. During the financial year
201718, the total fish production in India is esti mated at 12.61 Million Metric
tonnes.

2. Fibre and skins: The livestock also contributes to the production of wool, hair,
hides, and pelts. Leather is the most important product which has a very high export
potential. India is producing about 41.5 million Kg of wool per annum during 2017-
18.

3. Draft: Bullocks are the back bone of Indian agriculture. Despite lot of advancements
in the use of mechanical power in Indian agricultural operations, the Indian farmer
especially in rural areas still depend upon bullocks for various agricultural
operations. The bullocks are saving a lot on fuel which is a necessary input for using
mechanical power like tractors, combine harvesters etc. Pack animals like camels,
horses, donkeys, ponies, mules etc are being extensively used to transport goods in
different parts of the country in addition to bullocks. In situations like hilly terrains
mules and ponies serve as the only alternative to transport goods. Similarly, the army
has to depend upon these animals to transport various items in high areas of high
altitude.

4. Dung and other animal waste materials: Dung and other animal wastes serve as
very good farm yard manure and the value of it is worth several crores of rupees.
In addition it is also used as fuel (bio gas, dung cakes), and for construction as poor
man’s cement (dung).
5. Storage: Livestock are considered as 'moving banks' because of their potentiality to
dispose off during emergencies. They serve as capital and in cases of landless
agricultural labourers many time it is the only capital resource they possess.
14
Livestock serve as an asset and in case of emergencies they serve as guarantee for
availing loans from the local sources such as money lenders in the villages.

15
 6. Weed control: Livestock are also used as Biological control of brush, plants
and weeds.

7. Cultural: Livestock offer security to the owners and also add to their self esteem
especially when they are owning prized animals such as pedigreed bulls, dogs
and high yielding cows/ buffaloes etc.

8. Sports / recreation: People also use the animals like cocks, rams, bulls etc for
competition and sports. Despite ban on these animal competitions the cock fights,
ram fights and bull fights (jalli kattu) are quite common during festive seasons.

9. Companion animals: Dogs are known for their faithfulness and are being used as
companions since time immemorial. When the nuclear families are increasing in
number and the old parents are forced to lead solitary life the dogs, cats are
providing the needed company to the latter thus making them lead a comfortable life.

1.7 ROLE OF LIVESTOCK IN FARMERS’ECONOMY

The livestock plays an important role in the economy of farmers. The farmers in India
maintain mixed farming system i.e. a combination of crop and livestock where the output of
one enterprise becomes the input of another enterprise thereby realize the resource efficiency.
The livestock serve the farmers in different ways.

1. Income: Livestock is a source of subsidiary income for many families in India

especially the resource poor who maintain few heads of animals. Cows and
buffaloes if in milk will provide regular income to the livestock farmers through sale
of milk. Animals like sheep and goat serve as sources of income during emergencies
to meet exigencies like marriages, treatment of sick persons, children education,
repair of houses etc. The animals also serve as moving banks and assets which
provide economic security to the owners.

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2. Employment: A large number of people in India being less literate and unskilled
depend upon agriculture for their livelihoods. But agriculture being seasonal in
nature could provide employment for a maximum of 180 days in a year. The landless
and less land people depend upon livestock for utilizing their labour during lean
agricultural season.

3. Food: The livestock products such as milk, meat and eggs are an important source
of animal protein to the members of the livestock owners. The per capita availability
of milk is around 375 g / day; eggs is 74 / annum during 2017-18.

4. Social security: The animals offer social security to the owners in terms of their
status in the society. The families especially the landless which own animals are
better placed than those who do not. Gifting of animals during marriages is a very
common phenomenon in different parts of the country. Rearing of animals is a part of
the Indian culture. Animals are used for various socio religious functions. Cows for
house warming ceremonies; rams, bucks and chicken for sacrifice during festive
seasons;
Bulls and Cows are worshipped during various religious functions. Many owners
develop attachment to their animals.

5. Draft : The bullocks are the back bone of Indian agriculture. The farmers
especially the marginal and small depend upon bullocks for ploughing, carting and
transport of both inputs and outputs.

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1.8 LIVESTOCK POPULATION (2019 LIVESTOCK CENSUS)

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 1.9 Production of livestock in India 2017-18

1.10 INDIAN LIVESTOCK AND CLIMATE CHANGE

Climate change poses formidable challenge to the development of livestock sector in India.
The anticipated rise in temperature between 2.3 and 4.8°C over the entire country together
s with increased precipitation resulting from climate change is likely to aggravate the heatstres
in dairy animals, adversely affecting their productive and reproductive performance,and
hence reducing the total area where high yielding dairy cattle can be economically reared.
Given the vulnerability of India to rise in sea level, the impact of increased intensity of
extreme events on the livestock sector would be large and devastating for the low-income
rural areas. The predicted negative impact of climate change on Indian agriculture would also
adversely affect livestock production by aggravating the feed and fodder shortages. The
livestock sector which will be a sufferer of climate change is itself a large source of
methaneemissions, an important greenhouse gas. In India, although the emission rate per
animal is
much lower than the developed countries, due to vast livestock population the total
annual methane emissions are about 9–10 Tg from enteric fermentation and animal
wastes.

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INTRODUCTION OF LIVESTOCK INSURANCE

The Livestock Insurance Scheme, a centrally sponsored scheme, which was implemented on
a pilot basis during 2005-06 and 2006-07 of the 10th Five Year Plan and 2007-08 of the
11th Five Year Plan in 100 selected districts. The scheme is being implemented on a regular
basis from 2008-09 in 100 newly selected districts of the country. Under the scheme, the
crossbred and high yielding cattle and buffaloes are being insured at maximum of their
current market price.

The premium of the insurance is subsidized to the tune of 50%. The entire cost of the
subsidy is being borne by the Central Government. The benefit of subsidy is being provided
to a maximum of 2 animals per beneficiary for a policy of maximum of three years. The
scheme is being implemented in all states except Goa through the State Livestock
Development
Boards of respective states. The scheme is proposed to be extended to 100 old districts
covered during pilot period and more species of livestock including indigenous cattle, yak
& mithun.

The Livestock Insurance Scheme has been formulated with the twin objective of providing
protection mechanism to the farmers and cattle rearers against any eventual loss of their
animals due to death and to demonstrate the benefit of the insurance of livestock to the people
and popularize it with the ultimate goal of attaining qualitative improvement in livestock and
their products.
1.11 IMPORTANCE OF LIVESTOCK INSURANCE

While livestock contributes to the nutritional diet and food security of the people, the growth
of the sector in different states is very uneven. Accelerating growth in the Punjab, Haryana
and Gujarat regions is in stark contrast to states like Odisha, which lags behind. The
20
divergence is due to the policy focus of different state governments. Depending on the
incentives and infrastructure provided by the states, the sector grows or stalls. Developing
this sector in a country where 250 million people or 51% of the total employed population
works in agriculture is crucial. In a country that still faces rising population numbers the
livestockraising industry can potentially provide work for many, assure food security and
generate additional income – a cornerstone for further development and economic growth.
Nearly 60% of rural households have livestock as an integral part of their farming system.
About 69% of women are engaged in this sector. This sector contributes 26% to agricultural
GDP. According to latest 19th Census, the livestock population stands at 512 million in India.

Diseases trigger cost. The direct cost incurred is in the treatment of the animal. Additionally,
there is the loss-of profit if the animal products can no longer be offered for sale, or the cost
associated with buying products the owner normally procures from his animals. A wider cost
can be a loss of market share should buyers switch to other providers. Finally, but just as
important, buying new animals costs money. Shouldering this cost as well is very
burdensome for many farmers.

Another set of risks has to do with as shortage of fodder. The monsoon determines how much
is available in the country. If the rains fail, supplies drop at a time when farmers are most in
need. At the same time, falling production due to underfed animals makes it more challenging
to secure the revenues necessary to cover rising prices in the fodder market. In breeding
farms, there is also the risk that the production of higher yielding animals is not successful.
India still has plenty of room to increase animal productivity by switching to better breeds of
animals. If these new breeds underperform, this is a risk to the breeders

These risks become even more serious if the sector grows and changes. The growing number
of urbanites in India will mean city dwellers becoming increasingly dependent on accessing
animal products from the countryside. To meet this demand many smallholders in India will,
over time, need to develop into commercial farmers, and sell the surplus they make to the
growing cities. Transforming subsistence farming into an agricultural enterprise also means
that farmers will become more aware of the risks they face because livestock failure will be
tantamount to business failure. To protect their revenues, the coming decades will see them
looking increasingly to insurance as a means to deal with business risks. Average annual
losses calculated due to diseases like Foot & mouth diseases 74.3%, Haemorrhagic
septicaemia 19.2%, Black quarter 5.2 % and Anthrax 1.3 % in cattle during 1991-2005 time
periods.
Insurance as the key risk transfer must adapt to the coming reality of more commercial
farming in India. A simple look at the numbers reveals how big this challenge is. In
2012,
41.8 – 62.7 million cattle could have been insured. In2009, less than 7% of the cattle and
less than 0.6% of cattle holders had insurance. The numbers illustrate the tremendous growth
needed to cover Indian farmers against livestock risks adequately.

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 1.13 ADVANTAGES OF LIVESTOCK INSURANCE

 Protection Under a Farm Policy

If you have a small to medium-sized spread, a farm policy protects your structures
and animals. Similar to homeowner's insurance, this policy covers livestock
individually or as a herd.
Your livestock is covered if they are on your insured premises, but not while they
are in transit or away from your spread.
This policy also protects other personal property, like farming equipment, hay,
feed, structures and your home. Animals like chickens or other birds aren’t
considered livestock – they’re "poultry" that must be covered separately.

 Protection From Perils

Life happens fast. It's important your livestock is covered in an serious emergency
like a fire, smoke exposure or an explosion.
Peril insurance should cover your livestock due to theft, flooding or earthquake.
If your livestock is hit by a vehicle or if they die from a collision of the vehicle
that transports them, this is also covered.
Depending on circumstance, you may consider adding a "broad peril" coverage to
your policy. This additional clause insures against extreme perils like a boulder
falling on the animals, an attack from predators or even accidental shooting.

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 Animal Mortality Coverage

Limited animal mortality coverage can reimburse you for livestock that dies from
injury. If you need broader coverage, full animal mortality reimburses you for
animals that die from disease or age.
Sadly, livestock die for many reasons, but this form of insurance can help you
recoup your losses. Read the policy carefully to know what circumstances apply to
your animals if they die.
If the livestock dies from a pre-existing condition or if the death is owner-caused,
you likely aren’t covered. Make sure your animals are healthy because you'll need to
prove this before you renew your animal mortality coverage.
 Protection Against Falling Prices

23
 If you're a livestock producer who sells your animals as a commodity, this form of
insurance can protect you from financial losses. The policy is backed by the
USDA and pays you if the cash price index falls below a specified amount.
For farmers and ranchers who sell their lambs, cattle or swine for slaughter,
your investment is protected against serious losses.

 Stray Animals Are Covered

Animals have minds of their own. Sometimes, they stray from your farm or ranch.
This livestock insurance is usually an option. But it's essential if you're concerned
about animals escaping and being accidentally harmed or dying.

With straying coverage, the livestock's death can be covered if it has been struck by
lightning or a vehicle. It should also cover your animals if they’re shot by a
government official protecting the public from possible harm.

Even if you think your animals are safely cooped up or that your fencing is
adequate, you never know when one or more might stray away.
 Stay Safe From Liability

Since livestock can be unpredictable, it's essential to include some form of liability
coverage with your insurance. This protects you against claims of damage against
you or your property.

For example, if a horse kicks an employee or visitor and causes bodily injury, your
liability insurance should cover the costs. It also applies to property damage, so if an
animal damages someone's vehicle, for example, it's covered. The purpose of
livestock liability insurance is to avoid a costly lawsuit. This additional layer of
protection gives you peace of mind.

 Your Assets are Protected

24
Every animal you own is an investment, which is why livestock insurance is so
important. This insurance reimburses you for the current market value of any animal
you lose.

Whether its fire, flood or another catastrophe, it's important your hard-earned
money is safe so you can replace any livestock that are lost. Consider extra
coverage if you live in a high-risk area or if you're concerned about changes in
livestock prices.
Always notify your insurer when you acquire new animals.

1.14 PROCEDURE OF CLAIM UNDER LIVESTOCK

INSURANCE SCHEME

An animal will be insured for its current market price. The market price of the animal
to be insured will be assessed jointly by the beneficiary and the insurance company
preferably in the presence of the Veterinary Officer or the Block Development
Officer (BDO). The minimum value of animal should be assessed by taking Rs.3000
per liter per day yield of milk or as per the price prevailing in the local market
(declared by Government) for cow and Rs.4000 per liter per day yield of milk or as
prevailing in the local market (declared by Government) for buffalo.

The market price of pack animals i.e. horses, donkey, mules, camels, ponies and
cattle/buffalo male and other livestock such as goat, sheep, pigs, rabbit, yak and
mithun are to be assessed by negotiation jointly by owner of animal and by insurance
company in the presence of veterinarians. In case of dispute, the price fixation would
be settled by the Gram Panchayator BDO.

The animal insured will have to be properly and uniquely identified at the time of
insurance claim. The ear tagging should, therefore, be full proof as far as possible. The
traditional method of ear tagging or the recent technology of fixing microchips could
be used at the time of taking the policy. The cost of fixing the identification mark will
be borne by the Insurance Companies and responsibility of its maintenance will lie on
the concerned beneficiaries. The nature and quality of tagging materials will be
mutually agreed by the beneficiaries and the Insurance Company.

25
The tag already available on animal may be utilized with unique identity number,
subject to the condition that it is mutually agreed by farmer and agency and there shall
not be any dispute in settlement of claims on account of utilization of existing tag.
While processing an insurance proposal, one photograph of the animal with the owner
and one photograph of the animal clearly with the ear tag visible shall be taken at the
time of processing the insurance documentation. In case of sale of the animal or
otherwise transfer of animal from one owner to other, before expiry of the insurance
policy, the authority of beneficiary for the remaining period of policy will have to be
transferred to the new owner. Only four documents would be required by insurance
companies for settling the claims viz. intimation to the insurance company, insurance
policy paper, claim form and post-mortem report. In case of claim becoming due, the
payment of insured amount should be made within 15 days positively after submission
of requisite documents. If an insurance company fails to settle the claim within 15
days of submission of documents, the insurance company will be liable to pay, a
penalty of 12 percent compound interest per annum to.

1.15 TRANSFORMING LIVESTOCK INSURANCE IN A

CHANGING MARKET

Historically, until the year 2000 at least, the public sector general insurance
companies were the sole provider of livestock insurance in India. Liberalisation of
the cattle insurance market in 2003 allowed private insurers to decide premium and
policy conditions by themselves. This has paved the way for newer product offerings.
More of these by public and private companies are needed to meet the differing local
needs of farmers in the country India is a subcontinent with a wide variety of climate
zones and boundary conditions. Livestock holdings in one area depend on pasture, in
others on supplied fodder. Water constraints determine what breeds are raised.
Different breeds have varying susceptibility to diseases. The list of variation in
livestock holdings goes on.

Yet, even though there is so much difference, there are no customized product
offerings across India. Having the same product nationwide means that in some areas
the product does not offer what farmers need, while in other areas they have coverage
for risks they do not face. This not fit-for-purpose or location is one major reason
why farmers do not purchase livestock insurance. There are only 0.6 % cattle holders
are insured. Only 9% cattle insured in India. So far as the market share of cattle
insurance concerned, private sector accounts 83 %in India. Another reason farmers do
not purchase livestock insurance is distribution related. Often insurance is bundled
with credit. Credit-linked insurance policies are not always what farmers actually
need since the loan might be solely for one year, even though the farmer wants
insurance for a longer period. If the farmers want to renew their insurance policies,
they may be obliged to take out another loan even though they do not need one. These
are just two examples of how the current market does not address farmers’ needs.
Offering localised and tailored policies is one important way of convincing the vast
majority of farmers to take an interest in insurance.

26
The next big challenge is distribution. India is a big country. Consequently,
connecting farmers with infrastructure is difficult. This fact also hampers the
provision and administration of insurance and especially the most urgently
needed micro-insurance products.

This problem is not just confined to issuing policies. Most farmers are not yet familiar
with the concepts of livestock risk management and insurance. Providing this
information to them in a way they can understand is one element that is currently
missing. This education process has to include how proper risk-management lowers
premiums, which, in turn, acts as an incentive to minimise losses. This is extremely
important because loss ratios are high now. Lowering them will make it more
attractive for the insurance industry to offer products.

1.16 INVESTMENT, CREDIT AND INSURANCE

Animal husbandry and dairying is a state subject, and bulk of the investment for their
development comes from the state governments. The central government contributes
about 10% to the total investment through central and centrally-sponsored schemes as
to supplement state governments’ resources. In absolute terms, total outlay for animal
husbandry and dairying increased over the plan periods. However, as per cent of the
total plan outlay the share of animal husbandry and dairy development declined from
1.1% during first FYP to 0.4% during VI FYP and further to 0.3% in the subsequent
FYPs. As proportion of the total outlay for the agricultural sector, the share of
livestock fell from 11.2% in II FYP to 3.6 % in IX FYP but increased to 9.3% during
XI FYP. The share of livestock in the planned investment has never been
commensurate with its contribution to GDP or Agrl.GDP.

Since IV FYP the emphasis had been on dairy development to support the Operation
Flood Programme. With the end of Operation Flood program, the allocation to dairy
development slowed down, reaching to about 30% in the XI FYP. Animal health and
veterinary services now receive about 30% of the total funds. In XI Plan, the
centrally sponsored schemes -Animal Health and Disease Control and National
Project for Livestock Development accounted for a major share of the outlay for
animal husbandry. Small ruminants, piggery, feed and fodder development, research,
education and training did not receive adequate financial support. There has been a
large gap between planned and actual expenditure in case of Animal Husbandry in
most plan periods, except during Xth FYP.

There is hardly any private sector investment in animal husbandry except some
support to Gaushalas and Gosadans. The diary sector, however, has attracted
considerable private investment in processing, value addition and marketing. The
dairy development is no longer a monopoly of the NDDB as privately owned
dairy plants account for close to half of the total milk processed in the country.
Diary processing was not a priority for lending by institutional credit agencies. In
2009, dairy processing was included in the list of priority sector lending activities.

27
Credit: Financial institutions provide credit for various livestock as ‘term credit’ for
introduction of animals, construction of animal sheds, purchase of equipments etc.).
The credit is also provided for activities like establishment of milk collection centers,
bulk milk coolers, livestock product processing units, cold chain, storage and
marketing infrastructure, vehicles for transporting livestock products, retail outlets for
sale of livestock products etc. and feed and fodder development activities are also
eligible for financing.

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 1.17 SITUATION IN INDIAN STATES RELATED TO
LIVESTOCK INSURANCE

• In case of Indian states, although the situation is uneven but prospectively better. It
is elicited from the fact that in 2016.
Karnataka decided to implement the Livestock Insurance Scheme to encourage
farmers to insure their milch cattle and buffaloes. Under the scheme, a maximum
of
• five cattle/buffaloes would be covered by a farmers’ family (Prabhu, 2015).

Further, in Bihar and Orisa, Pradhan Mantri Fasal Bima Yojana has been
implemented in 2016 and these states are looking forward for the central livestock
insurance policy to get doled up (Mukherjee, 2016). Khan et al. (2013) in Central
India reported that most of the farmers were willing to get their cattle and
buffaloes
• insured.

In Gujarat, cattle insurance was availed due the motivation of Village Cooperative
Society (VCS). Insurance was sold on partner-agent model and that too from a
single company with whom VCS had a close tie-up (Trivedi and Soni, 2014). The
condition of livestock insurance in the state of Punjab is better than many states as
4,53,100 animal heads in total were insured by the four subsidiary insurance
companies of General Insurance Corporation of India (GIC) namely New India
Assurance Company Ltd., Oriental Insurance Company Ltd., United India
Insurance Company Ltd. and National Insurance Company Ltd. (Mohapatra et al.,
2014).
•
In Haryana and Rajasthan, the extent of livestock cover is poor and further the
renewal of insurance policies by policyholders adds to the dismay (Chand et al.,
2016). In the context of livestock insurance, the Government of Rajasthan supports
two insurance schemes Kamdhenu and Bhais Bima, which provides insurance
against death of cows and buffaloes and is similar to the livestock insurance
scheme of the Central Government. For sheep too, the Rajasthan Government’s
Avika Kavach scheme provides insurance against death and disability of sheep as
in the Sheep Insurance Scheme of the Central Government (Choudhary and
Srinivasan, 2011). The number of animals insured in different states of the country
are presented in Table 2 and 3.
•
Basunathe and Tripathi (2017) conducted a study in Maharashtra and found that
majority of the respondents (82.67%) considered information on insurance,
agencies and insurance schemes for livestock in aAQUA as ‘most appropriate’
need in Warna Wired Village project. Further, Jhirwal et al. (2018) have reported
an increase in poultry enterprises but low level of knowledge among farmers.
Similarly, knowledge as a constraint was reported among dairy farmers by Minhaj
et al. (2019). Therefore, one aspect is knowledge enhancement and other is information dissemination
which will boost the insurance segment in livestock sector. Kumar et al. (2018) have reported that
motivation plays a central role in adoption of insurance among farmers.

1.18 TYPES OF LIVE STOCK INSURANCE

• 1.18.1 CATTLE INSURANCE

30
 Cattle insurance protects Indian rural people from financial loss incurred
due to the death of their cattle. The cost of cattle is high and their loss can
force farmers to get into a debt cycle. With cattle insurance, farmers will get
comprehensive protection against the cattle loss.

 RISK INSURED

• Death of cattle:
It covers loss of life due to accident or injury and disease occurred due
to surgical infection

Permanent Disability cover:

It covers the risk of permanent and complete disability
 What Cattle Insurance Covers?

31
 Besides death or disability caused by fire, drowning, electrocution, snake bites or
poisoning, cattle insurance offers coverage for other issues as well. They
include:

I. Death due to natural calamities like storms and earthquakes

II. Death due to disease, infection or calving during surgical operations

III. Permanent disability, for milch cows this refers to incapacity to conceive and
yield milk. For bulls, this refers to incapacity to breed

32
  EXCLUSIONS (what is not covered)

Malicious or willful injury or neglect, overloading, unskillful treatment or use

of animal for purpose other than stated in the policy
Enterotoxaemia, Sheep Pox, Goat Pox, Rinderpest, FMD, Anthrax, H.S, B.Q. if the
•
animal is not successfully inoculated (protected)
Death due to any disease contracted within 15 days from the date of commencement
• of the policy
Transport by air and sea. Transport beyond 25 kilometers from the place of stabling
• by rail/road and beyond 50 kilometers from the place of stabling in case of transit
by foot
• Loss or damage caused willfully or knowingly by the Insured or any person acting
on his behalf
Normal cracking, settlement, bedding down, up heaving of land/structures, coastal
• or river erosion, defective design, workmanship or use of defective material Theft
or clandestine sale
• Partial disability of any type, whether permanent or temporary
Accidents occurred and/or diseases contracted prior to commencement of risk
• Intentional slaughter of the animal except in cases where destruction is necessary
to terminate incurable suffering
• Any consequential loss, however
arising Death due to Plueropneumonia
 COMPANIE’S OFFERING CATTLE INSURANCE IN INDIA

• HDFC ERGO.

• RELIANCE GENERAL

• ICICI LOMBARD.

• TATA AIG.

• ORIENTAL INSURANCE

• SBI GENERAL.
 1.18.2 SHEEP AND GOAT INSURANCE

All indigenous, crossbred and exotic Sheep and Goat will be covered under this
Scheme. The policy shall provide indemnity against death of sheep and goats due
to accident Including Fire, Lightning, Flood, Cyclone, Famine, Earthquake,
landslide, Strike, Riot or diseases contracted or occurring during the period of
insurance.

EXCLUSIONS

• Malicious or willful injury or neglect, overloading, unskillful treatment or use

of animal for purpose other than stated in the policy without the consent of the
Company in writing.

37
• Accidents occurring and /or Disease contracted prior to commencement of risk.

• Intentional slaughter of the animal except in cases where destruction is necessary

to terminate incurable suffering on humane consideration on the basis of certificate
issued by qualified Veterinarian or in cases where destruction is resorted to by the
order of lawfully constituted authority.

• Theft and clandestine sale of the insured animal.

• War, invasion, act of foreign enemy, hostilities (whether war be declared or not),
civil war, rebellion, revolution, insurrection, mutiny, tumult, military or usurped
power or any consequences thereof or attempt threat.

• ny accident, loss, destruction, damage or legal liability directly or indirectly

caused by or contributed to by or arising from nuclear weapons.

• Consequential loss of whatsoever

nature. Transport by air and sea.

• Any non-scheme claim arising due to diseases contracted within 15 days from
the date of risk are not covered.

 CLAIM PROCEDURE

In the event of death immediate intimation should be given to the Company

and the Insured should furnish the following documents and required
information. Duly completed claim form.

• Death certificate from a Veterinarian on Company's form.

• Post mortem examination report if required by the Company.

• Ear tag wherever applicable.

 COMPANIE’S OFFERING SHEEP AND GOAT INSURANCE

• SBI GENERAL INSURANCE

• OICL

• UIIC

• FUTURAL GENERAL INSURANCE

38
  1.18.3 POULTRY INSURANCE

Poultry farming is a volatile business in India, in which there is usually a possibility of huge
profits as well as losses. In the event of death of poultry, the farmer suffers loss of income
and disruption in the rearing program. If the loss exceeds a specified limit, then poultry
insurance compensates the farmers so that the farmer can control the loss completely.
Poultry insurance acts as a risk transfer mechanism in exchange for a small premium. The
Poultry Insurance Scheme is applicable to all types of exotic and cross-breed poultry birds in
India with poultry farms. At the time of death, 80% compensation of the value of the bird is
given according to the pricing table and 20% additional compensation is given for Gumboro
disease according to the conditions.

To cover the risk of animal death, Government of India (GOI) introduced the livestock

39
CHAPTER 2:- DATA ANALYSIS AND
INTERPRETATION

40
 1. Do you know what is livestock ?

Yes No Total
No of response 22 09 31
Percentages 71% 29% 100%
Yes NO

29; 29%

71; 71%

Interpretation:

This pie diagram shows that 71% peoples are aware about livestock and 29%
are not aware.

41
 2. Are you aware about livestock insurance ?

Yes No Total
No of response 22 09 31
Percentages 75% 25% 100%

Interpretation:

This pie diagram shows that 75% peoples are aware about
livestock insurance and 25% are not aware.

42
 3. Have you taken an livestock insurance policy ?

Yes No Total
No of response 14 17 31
Percentages 47.5% 52.5% 100%

Interpretation:

This pie diagram shows that 52.5% peoples have not taken livestock
insurance and 47% people have taken the livestock insurance policy.

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 4. If yes, which animal have you insured ?

Cattle Horse Sheep Goat Total

No of response 12 7 6 6 31
Percentages 38.7% 22.6% 19.35% 19.35% 100%

19.35

38.7

1st Cattle
2nd Horse
3rd Sheep
4th Goat
19.35

22.6

Interpretation:

This pie diagram shows that 38.7% peoples have taken cattle insurance
policy, 22.6% peoples have taken horse insurance policy, 19.35% peoples have taken goat
insurance policy and 19.35% peoples have taken sheep insurance policy.

44
 5. Which type of livestock policy have you taken ?

Farm Dairy Total

No of response 18 13 31
Percentages 58.1% 41.9% 100%

41.9; 42%
1st Farm
2nd Dairy

58.1; 58%

Interpretation:

This pie diagram shows that 41.9% peoples have taken farm type
insurance policy and 58.1% peoples have taken dairy type insurance policy.

45
 6. What is the period of livestock insurance policy you have taken
?

1 Year 2 Year 3 Year More than 3 Total

year
No of response 13 8 5 5 31
Percentages 41.9% 25.8% 16.1% 16.1% 100%

16.1

41.9
1 Year
16.1 2 Year
3 Year
More than 3 year

25.8

Interpretation:

This pie diagram show that 41.9% peoples have taken the policy period of 1
year, 25.8% peoples have taken the policy period of 2 year, 16.1% peoples have taken the
policy period of 3 year and 16.1% peoples have taken the policy period of more than 3 years.

46
 7. Which kind of risk is covered under livestock insurance ?

Besides Disability Natural All of the Total

death cause by Death above
fire or
accident
No of response 12 6 5 8 31
Percentages 38.7% 25.8% 16.1% 19.3% 100%

25.8

38.7

16.1
19.3

Besides death Disability cause by fire or accident

Natural Death All of the above

Interpretation:

This pie diagram shows that 50% peoples think all type of risk is
covered which has been mentioned in the above diagram. 20% peoples think that beside
death is covered in the livestock insurance policy. Whereas 15% peoples think natural
death and disability caused by fire is covered under livestock insurance policy

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 8. What kind of diseases are covered in the policy ?

Goat Rinderpest Sheep pox All of the Total

pox above
No of response 7 4 7 13 31
Percentages 38.7% 22.6% 19.35% 19.35% 100%

22.5

41.9

12.9

22.5

Goat pox Rinderpest Sheep pox All of the above

Interpretation:

This pie diagram shows that 41.9% peoples think all diseases are covered
in the policy. 22.5% peoples think goat pox , 22.5% peoples think sheep pox where as 12.9%
peoples think rinderpest disease is covered under livestock insurance policy.

48
 9. Is the claim settlement procedures is easy or complicated ?

Easy Moderate Complicated Total

No of response 9 16 6 31
Percentages 29.03% 51.62% 19.35% 100%

1.4

29.03

51.62

Easy Moderate Complicated

Interpretation:

This pie diagram shows that 51.62% peoples think claim

settlement procedure is moderate, 29.03% peoples think it is easy and 19.35% peoples
think complicated.

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 10. Which kind of animal breeds can be insured ?

Cattle Sheep Dogs Both All of the Total

breed breed A&B above
No of response 5 3 6 9 8 31
Percentages 15% 9% 19% 28% 29% 100%

Cattle breed
15%
All of the above
29%

Sheep breed
9% Cattle breed
Sheep breed
Dogs
Both A&B
All of the above

Dogs
19%

Both A&B
28%

Interpretation:

This pie diagram shows that 9% peoples think cattle and ship both
breeds can be insured, 28% peoples think all kind of breeds can be insured where as 29%
peoples think cattle insured and 15% peoples think dog breeds can also be insured in the
livestock insurance policy.

50
 11. If you have any exotic animal which type of insurance have
you taken for him ?

Huskey Persian Cat Aquatic animal Total

Fish
No of response 11 12 8 31
Percentages 35.5% 38.7% 25.8% 100%

25.8; 26%
35.5; 36%
Huskey
Persian Cat
Aquatic Animal Fish

38.7; 39%

Interpretation
This pie diagram show that 35.5% peoples have taken the livestock
insurance policy for their pet dogs (huskey), 38.7% peoples have taken for their persain cat and
25.8% peoples have taken policy for their aqutic animal (fish).

51
 12. What are the medical exclusion your insurance policy have?

Natural Non Uncovered Total

Mis accidental Diseases
courage death
No of response 8 12 10 31
Percentages 29% 38.7% 32.3% 100%

Natural Mis
Uncovered courage
Diseases 29%
32%

Non accidental death

39%

Natural Mis courage Non accidental death Uncovered Diseases

Interpretation:

This pie diagram shows that 29% peoples are saying that natural
exclusion has been mentioned in their medical policy have, where as32% peoples saying that
non accidental death and 39% peoples are saying that uncovered diseases are mentioned in
the exclusions.

52
 CHPTER 5. FINDINGS AND SUGGESTIONS

 From the research it is observed that most of the peoples not are aware about the
importance of livestock.

 From the research it is observed that peoples are saying that they know the
importance of livestock but more than 50% peoples had not taken any
livestock insurance policy.

 From the research it is also observed that many of the peoples have farm type
livestock insurance policy.

 From the research it is observed that peoples don’t know the detailed medical
exclusions of livestock insurance policy.

53
 From the research it is observed that peoples are not aware that the exotic animals are
not considered in livestock.

 From the research it is observed that all diseases are not covered under the livestock
insurance policy.

 From the insurance it is observed that the main stream insurance companies are not
promoting their livestock insurance policy.

 From the research it is also observed that peoples don’t know the actual claim
procedure of livestock insurance.

SUGGESTIONS

 Government should conduct awareness programs of livestock insurance in every

district in India.
 Insurance companies should bridge the gap between cattle insurance and the exotic
livestock insurance policy.

 Peoples should maintain the balance between eco-system and technology.

 Government should study the adverse effect of pollution on livestock.

54
 CONCLUSION

India being a diverse country with varied climatic zones, soil cover and livestock aggregation
require an effective safeguard from environmental variations, natural disasters and sudden
outbreaks of fatal diseases pertaining to livestock. This can only be achieved by creating
awareness among the rural livestock farmers and motivating them to insure their animals.
There is lack of knowledge among farmers about certain scientific aspects of livestock
farming, livestock insurance being one of those. Studies have suggested that adoption of
livestock insurance among livestock owners is mainly effected by motivation by friends and
community members followed by high probability of disease occurrence in particular area,
effective risk assessment and previous experience of livestock owners. Knowledge of any
practice plays an important part in adoption, therefore, focus shall be made on increasing the
knowledge domain of the farmers through awareness camps and trainings. Further, the
insurance institution should take measures like developing infrastructure, to reduce the
premium and appoint proper staff to guide the farmers for the insurance. Although the
central and the state governments are taking up policies to cater the needs of the livestock
owners but still reaching to the grassroots is a challenge. To increase the insurance coverage,
to equip the livestock farmers with latest knowledge about insurance, to assess their
information needs pertaining to insurance and to address them, seem to be the few decisive
challenges but can eventually be fulfilled by better extension and advisory services.

BIBILOGRAPHY:

• Crop and Livestock Insurance (Esther Marie Colvin)

• Livestock and aquaculture insurance in developing countries (Food

and Agriculture Organization of the United Nations

WEBILOGRAPHY :

https://www.reliancegeneral.co.in/Insurance/Rural-Insurance/Livestock-Insuranceaspx

55
https://wwwroyalsundaram.in/business-insurance/rural-sector/livestock-insurance

https://wwwsciencedirect.com/science/article/abs/pii/S030438780600006X

https://www.paisabazaarcom/rural-insurance/cattle- insurance/#:~:text=What%20is%20Cattle
%20Insurance%3F,protection%20against%2 0the%20cattle%20loss

https://en.wikipedia.org/.wiki/Insurance

54