Man and beast: Who?s precious?

New Delhi, March 15: It?s a little hard to stomach this: the life of a milch cow is 10 times more valuable than a farmer?s.

Micro-insurance is a concept that?s just beginning to take root in India. However, insurers are staggered by the sort of ?quirky demands? that they are beginning to face.

Farmers in the country want a higher risk coverage for their cattle than for themselves.

According to suggestions received by Insurance Regulatory and Development Authority (IRDA) on the concept of micro insurance, farmers are demanding a comprehensive insurance policy for themselves and their cattle. But the funny thing is that they are insisting on a risk cover of just Rs 2,000 on their lives and Rs 20,000 on each head of cattle.

?We have got some very stark contrarian views,? said T. K. Banerjee, member of IRDA.

IRDA is in the process of putting regulations on micro insurance in place. ?We want to expedite the process and have final regulations in place as soon as possible. However, the suggestions that have trickled in from the stakeholders run counter to our own,? he added.

For example, the regulator wants agents selling micro insurance products to undergo a minimum 25 hours of training to ensure ?minimum knowledge?. According to officials, the insurance companies have requested for a ?no licence, no test and no mandatory of training? regime for such agents.

Banerjee said, ?The agents should know the product well before they sell and make any commitment. We do not want mis-selling.?

Contrary to the regulator's suggestion of restricting the cap on sum assured of a life cover to Rs 25,000, insurance companies want the ceiling raised to Rs 1 lakh.

?We don't want rich people to take advantage of this policy. It should reach the right kind of people,? Banerjee said.

Since the regulator had put up draft regulations, it has got variety of suggestions from various stakeholders, including insurers, self help groups, NGOs, micro finance institutes and individuals.

The main objective of micro-insurance agencies will be to sell composite products (both life and non-life) under one umbrella to poor people at effective premium rates.

Micro-insurance refers to protection of assets and lives against insurable risks of target populations such as micro-entrepreneurs, small farmers and the landless, women and low-income people through formal, semi-formal and informal institutions.