LAHORE: Habib Bank Limited (HBL), the Bank of Punjab (BoP) and TPL Insurance Limited have entered into a strategic partnership for pilot testing of the Area Yield Index Insurance (AYII) product proposed by the Pakistan Agriculture Coalition.

The product will enable farmers to avail crop production loans from HBL and BoP in pilot districts with the provision of yield insurance coverage bundled with their loan product.

The incremental premium cost for the value-added services for additional cover under AYH will be jointly shared by HBL, BoP and TPL. The product will ensure climate resilience and financial stability through insuring the crop production risks against climatic abnormalities, including windstorm, frost, excessive rainfall, heatwave, hail, flood, drought, pest and diseases.

The project will initially focus on wheat and rice crops in Pakpattan, Gujranwala, Hafizabad and Sheikhupura districts of Punjab.