The Government of India have introduced a comprehensive scheme of crop insurance throughout the country from Kharif 1985 season covering major crops viz., cereals, oilseeds and pulses. The impact of crop insurance scheme is more pertinent in the state like Gujarat as it alone accounts for almost 43 per cent of total claims.

Agriculture in India is subject to variety of risks arising from rainfall aberrations, temperature fluctuations, hailstorms, cyclones, floods and climate change. These risks are exacerbated by price fluctuation, weak rural infrastructure, imperfect markets and lack of financial services including limited span and design of risk mitigation instruments such as credit and insurance.