If you’re a farmer in India, chances are you’ve either got some kind of farm insurance or you’re thinking about getting one. Whether it’s to protect your crops, livestock, tractors or even your farm buildings — insurance gives peace of mind when things go pear-shaped.

But here’s the deal — a lot of farmers end up making common mistakes with their insurance. And these mistakes can cost you big when it comes time to make a claim. So, let’s walk through the top farm insurance mistakes, and more importantly, how to avoid them.

1. Not Understanding What the Policy Covers

One of the most common farm insurance mistakes we see is farmers not fully understanding what their policy actually covers.

Let’s be honest — those long insurance documents can feel like they’re written in another language. But ignoring the fine print can backfire. Some policies don’t cover natural disasters like droughts or floods unless specifically added.

👉 Stat check: According to the Agriculture Insurance Company of India, only about 35% of insured farmers fully understand their policy coverage.

How to avoid it:
 Take the time to read the Product Disclosure Statement (PDS). Better yet, sit down with an insurance broker who specialises in farm insurance. They can walk you through it in plain language.

2. Choosing the Cheapest Premium

We get it. Everyone wants to save a few bucks. But when it comes to insurance, the cheapest option isn’t always the smartest one.

Cheaper policies often come with higher deductibles, limited coverage, and exclusions you don’t notice until it’s too late. For example, your policy might not cover theft of high-value machinery unless specifically listed.

👉 Stat check: A 2023 IRDAI report found that underinsurance in rural sectors is as high as 45%, with many opting for the lowest-cost plans.

How to avoid it:
 Don’t just compare premiums — compare what you actually get for your money. Think of insurance like a safety net. A stronger net might cost more, but it’s worth it when the fall happens.

3. Not Reviewing Your Policy Regularly

Your farm changes every year — new equipment, more land, different crops — but does your insurance policy keep up?

One of the biggest farm insurance mistakes is thinking, “She’ll be right,” and leaving the same policy in place year after year.

👉 Example: Let’s say you bought a new harvester last season. If you haven’t updated your policy, it might not be covered.

How to avoid it:
 Set a reminder to review your policy every 12 months. Better yet, have a quick chat with your insurance broker after every major purchase or change to the farm.

4. Relying on One-Size-Fits-All Coverage

Every farm is different — from size to what you grow or raise. A cookie-cutter insurance policy may not protect your specific risks.

For example, a wheat farmer in Punjab faces different challenges compared to a dairy farmer in Tamil Nadu. But both might be using the same basic cover, which can be a problem.

How to avoid it:
 Customise your insurance. Ask your broker for a plan that suits your farm, location, and operations.

5. Poor Documentation and Record Keeping

You’d be surprised how many insurance claims are delayed or denied just because of missing paperwork.

When a tractor is stolen, or crops are damaged in a storm, your insurer will ask for proof. No receipts, no photos? That’s a recipe for trouble.

👉 Pro tip: Keep a digital folder with all your purchase receipts, serial numbers, and photos of major assets. It’ll make life heaps easier when you need to file a claim.

6. Delaying Claims or Missing Deadlines

Life on the farm is flat-out busy. But waiting too long to report a loss is another common mistake.

Insurers in India often have strict timeframes for lodging claims — sometimes within 72 hours of an incident.

👉 Stat check: As per a 2022 NABARD survey, nearly 28% of delayed claims from farmers were rejected due to missed deadlines.

How to avoid it:
 If something goes wrong, report it as soon as possible. Don’t wait until the end of the week or harvest season.

7. Not Working with a Specialist Insurance Broker

Going directly to an insurance company might save you a few rupees upfront, but working with a qualified insurance broker can save you serious money and hassle in the long run.

A broker knows the ins and outs of farm insurance. They can explain things in plain English, help you find the best policy for your needs, and even fight for you if a claim is denied.

👉 Pro tip: Always choose an insurance broker who specialises in agriculture or rural insurance. They’ll understand your risks better than a general broker.

8. Assuming Government Disaster Relief Will Be Enough

Many farmers believe that if something major happens, the government will step in with financial aid.

While that’s partly true, the reality is that disaster relief is often slow and rarely covers full losses.

Example: After Cyclone Tauktae in 2021, many farmers received government support, but it only covered 40–60% of the damage in most cases.

How to avoid it:
 Don’t rely on government help as your only backup. Make sure your insurance fills the gaps.

9. Ignoring Business Interruption Insurance

Here’s one most farmers don’t think about — what happens if your farm can’t operate for weeks due to flood or equipment failure?

That’s where business interruption insurance comes in. It helps cover lost income during downtime, so you can keep paying bills, staff, or even loans.

How to avoid it:
 Ask your broker about adding business interruption coverage to your existing policy. It might be a small extra cost, but a massive lifesaver.

10. Not Bundling Your Policies

Buying separate policies for different things — crop, livestock, vehicles, home — can quickly add up and leave you undercovered.

How to avoid it:
 Bundle your policies with one provider if possible. You could save money and have fewer headaches managing renewals and claims.

Final Thoughts

Farm insurance doesn’t have to be a minefield. By avoiding these common mistakes and staying informed, you’ll be in a much better position when life throws a curveball.

If you’re unsure where to start, talk to a trusted insurance brokerwho understands the ins and outs of rural life. A few extra minutes today can save you from a world of stress tomorrow.

Need help understanding your policy or finding the right cover?
 Reach out to an experienced farm insurance broker in your area. It’s their job to make sure you’ve got the best safety net for your livelihood.