Droughts and environmental issues have the most impact on the agriculture industry, accounting for around 84 percent of the overall economic effect, according to a report from the Food and Agriculture Organization of the United Nations (FAO).
If concrete steps aren’t made to safeguard the agricultural industry through agriculture insurance, the situation is likely to get worse.
Moreover, there is also a great deal of demand to raise food production, increase security, and safeguard farms as a result of population growth.
Some of the Effects of Natural Disasters on Agriculture
Natural disasters and environmental issues have an immense impact on agriculture and greatly affect the economic situation of countries such as Pakistan. Here are some ways how floods, rains, storms, or droughts affect agriculture:
- Loss of perennial crops including rhubarb, bananas, and garlic
- Rising unemployment endangers the rural livelihood
- In the event of flooding, the land cannot be used until the water recedes.
- Salinity levels are steadily rising, rendering the ground unusable for agriculture.
- Decreased productivity results in lower farmer income
What Is Agriculture Insurance?
When agriculture is linked to catastrophes and hazards that are out of our control, precautions must be taken in order to limit the harm that farmers endure.
A crop insurance plan also known as agriculture insurance aids in stabilizing agricultural output and lessens the detrimental effects it has on farmers’ livelihoods. Crop insurance has become essential for concerns related to agriculture in light of the current situation.
Benefits of Agriculture Insurance to Farmers
Farmers get crop insurance to safeguard their income against unanticipated calamities.
Crop insurance helps reduce poverty since the majority of farmers’ livelihoods depend on the quality and volume of the yields they generate. The benefits of crop insurance include:
1. Minimum Debt
With the assistance of the proper insurance partner, farmers are still able to pay back their loans during periods of crop failure.
2. Income Stability
It safeguards farmers from crop failure-related economic damages. It functions as a tool that gives farmers the ability to control their yield and pricing risks.
3. Increases Awareness
To educate farmers about the effects of natural disasters and to assist them to safeguard their fields, insurance firms run awareness programs.
Although a natural disaster cannot be predicted, farmers may utilize forecasting techniques to understand climate change and safeguard their crops. Therefore, farmers’ peace of mind is among the most significant advantages of purchasing crop insurance.
Data, technology, and financial services must be used to address climate-related issues since impoverished farmers in developing nations with few resources are the main victims of natural catastrophes.
Agriculture insurance in Pakistan will help farmers become self-sufficient, which will be advantageous.
To achieve higher-quality fruit, they will also be able to increase their agricultural investment.