Farmers being paid adequate compensation under PMFBY: Govt

The ministry issued a statement to this effect after a media report surfaced in Maharashtra claiming that farmers are being paid paltry sum as insurance under the PMFBY in certain districts

Foodgrain production target

New Delhi: Union ministry of agriculture and farmers welfare today reiterated that the central government would provide comprehensive insurance coverage against crop loss on account of non-preventable natural risks under Pradhan Mantri Fasal Bima Yojana (PMFBY).

The ministry issued a statement to this effect after a media report surfaced in Maharashtra claiming that farmers in various districts are being paid paltry sum as insurance under the PMFBY. The ministry had inquired into the matter reported in the media and ‘falsified’ the claim, stating that the farmers are being adequately compensated.

“The Union ministry of agriculture and farmers welfare has attempted to examine the cases reported in the news item, however due to the lack of specific data points only one farmer has been identified namely Pandurang Bhaskar Rao Kadam. It has been reported in the news items that while he paid ₹595 as the total premium, he received claim of ₹37.31 as compensation for one crop and ₹327 for another. But, as per actual claim data, till date, he has received the total claim amount of ₹2080.40, almost four times of premium paid by him,” the release claimed.

The press note further said that the amount of ₹2080.40/- is only part of the claims and rest payment would be made. “Pandurang Rao may get more money, once the final settlement of claims is completed. It is also noteworthy that some of the farmers in the Parbhani district have received more than ₹50,000 as insurance claims and one farmer even received ₹94,534 before the final settlement of the claims of the district.

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PMFBY is the third largest crop insurance scheme in the world and tipped to become number one in coming years as around 5 crore farmer applications are being received under the scheme every year. The acceptability of the scheme has increased amongst the farmers in the last six years, with share of non-loanee farmers, marginalized farmers and small farmers increasing by 282% since the initiation of the scheme in 2016.

In the last six years, ₹25,186 crores have been paid by farmers as the premium, wherein ₹1,25,662 crores have been paid to the farmers against their claims as on October 31 this year with Central and state governments bearing most of the premium under the scheme.

In Parbani district, 6.66 lakh farmer applications were received in which premium of ₹48.11 crores have been paid by the farmers against which claims of ₹113 crores have been paid till date. However, those farmers whose claim is less than ₹1000/- will be paid at the time of final settlement with the condition that minimum of ₹1000/- will be paid to an individual farmer, if any claim arises.

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The Maharashtra government has informed that out of 79.53 lakh applications, in Kharif-22,in the State about 283 applications has sum insured below ₹100/- and 21,603 applications have sum insured below Rs.1000/- Some farmers have multiple applications and, in some cases, the total claim is low because their area insured is very low. To overcome this problem, Government of Maharashtra has provisioned that minimum of ₹1000/- claim shall be paid against any unique farmer ID.

The scheme is being implemented on actuarial/bidded premium rates however, farmers including small farmers have to pay maximum 2% for Kharif, 1.5% for Rabi food and oilseed crops and 5% for commercial/horticultural crops respectively. Premium over and above these limits is shared by the central and state governments on 50:50 basis except in north eastern region where it is 90: 10 from Kharif 2020. The scheme operates on the insurance principles therefore the extent of area insured, extent of damage occurred, sum insured are the important determinants in arriving at the claim amount.

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