Indian farming is risk based and every natural calamity or unforeseen weather change disrupts the farming practices altogether. It forces the farmers to depend more on public capital support to survive the natural calamity. Apart from government funding, insurance is a major source of capital support to the distressed farmers. Both public and private sector involve in crop insurance sector; however, the performance assessment report on crop insurance forces us to look at it critically. The data shows that it has become a source of extracting capital rather than supporting the capital formation of calamity/risk affected farmers. Companies are extracting money as premium payment and paying negligible percentage to the farmers. The basic principle of insurance is not being put into operation, which is further excluding the distressed farmers.
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