The insurer said it has disbursed payouts to around 500 farmers across more than 30 villages in Tonk district of Rajasthan after excess soil moisture breached pre-defined thresholds under the Water Balance Index (WBI). The policy, which began in November 2025 and runs through April 2026, was designed to cover soil moisture imbalance during the rabi season, a risk that often leads to waterlogging, root damage and crop rot.
The claim was largely driven by damage to wheat crops in Tonk, even though the cover extended to multiple rabi crops across Rajasthan and parts of Uttar Pradesh. Digit had partnered with Howden Insurance India to offer the WBI-based parametric solution to over 6,000 farmers across Tonk, Varanasi, Gorakhpur and Jaunpur, covering nearly 2,200 acres.
“Parametric insurance provides immediate liquidity using objective and transparent data,” said Adarsh Agarwal, appointed actuary at Digit Insurance. “This helps bridge the gap between climate shock and recovery, especially when volatility is increasing.”
The company said that such products are gaining relevance as erratic rainfall, prolonged dry spells and extreme weather events make loss assessment slower and more contested under conventional schemes.
While parametric insurance is still nascent in India and not a replacement for traditional crop insurance, it can develop as a complementary layer that can stabilise farm incomes, support rural consumption and build trust through faster, undisputed payouts, the company said.
Digit said it will continue to explore scaling parametric solutions across crops, districts and vulnerable groups as climate risks intensify.