Pradhan Mantri Fasal Bima Yojana : Starred Question in Loksabha

Pradhan Mantri Fasal Bima Yojana

(a) the details of enrolment of farmers in the Pradhan Mantri Fasal Bima Yojana(PMFBY) during each of the last three years and the current year, State-wise; 
(b) whether lakhs of farmers insured in the first year of PMFBY in 2016-17 withdrew themselves from the scheme in 2017-18 and if so, the details in this regard and the reasons therefor; 
(c) whether the Government has undertaken any investigation on the implementation of the scheme and its net effect on the farmers, if so, the details and the outcome thereof; 
(d) whether the crop insurance companies have registered huge profits since the launch of the scheme, if so, the response of the Government thereto and the present stand of the Government on the scheme in view of farmers withdrawing themselves from the scheme; and 
(e) the remedial measures being taken by the Government to strengthen the scheme and benefit the poor farmers instead of middlemen like insurance companies along with the steps taken to build confidence among farmers to opt for the scheme?

GOVERNMENT OF INDIA
MINISTRY OF AGRICULTURE AND FARMERS WELFARE

LOK SABHA

STARRED QUESTION NO: 17                                                              ANSWERED ON: 11.12.2018

Pradhan Mantri Fasal Bima Yojana

HARI BABU KAMBHAMPATI
KAMAL NATH

Will the Minister of AGRICULTURE AND FARMERS WELFARE be pleased to state:-

(a) the details of enrolment of farmers in the Pradhan Mantri Fasal Bima Yojana(PMFBY) during each of the last three years and the current year, State-wise; 
(b) whether lakhs of farmers insured in the first year of PMFBY in 2016-17 withdrew themselves from the scheme in 2017-18 and if so, the details in this regard and the reasons therefor; 
(c) whether the Government has undertaken any investigation on the implementation of the scheme and its net effect on the farmers, if so, the details and the outcome thereof; 
(d) whether the crop insurance companies have registered huge profits since the launch of the scheme, if so, the response of the Government thereto and the present stand of the Government on the scheme in view of farmers withdrawing themselves from the scheme; and 
(e) the remedial measures being taken by the Government to strengthen the scheme and benefit the poor farmers instead of middlemen like insurance companies along with the steps taken to build confidence among farmers to opt for the scheme?

ANSWER

MINISTER OF AGRICULTURE AND FARMERS WELFARE
(SHRI RADHA MOHAN SINGH)

(a) to (e): A statement is laid on the Table of the House.


STATEMENT REFERRED TO IN REPLY TO PARTS (a) TO (e) OF LOK SABHA STARRED QUESTION NO. 17 DUE FOR REPLY ON 11TH DECEMBER, 2018.
(a): Year-wise and State-wise details of farmers enrolled under the Pradhan Mantri Fasal Bima Yojana (PMFBY), since its inception in April, 2016 till Kharif 2018, are given in Annexure.

(b): No Madam. Both loanee and non-loanee farmers are enrolled under the scheme. Loanee farmers are those who avail the Kisan Credit Card/Crop Loan for notified crops and they are mandatorily covered under the scheme. Participation of non-loanee farmers in the scheme is voluntary. 

After implementation of the PMFBY since April, 2016, enrolment of non-loanee farmers has increased from 27.81 lakh in 2015-16 under erstwhile schemes to 136.66 lakh in 2016-17 and to 138.47 lakh in 2017-18 indicating acceptance of the scheme. 

Enrolment of loanee farmers declined in 2017-18 because of the reasons like farmers becoming ineligible for crop insurance due to Debt Waiver Scheme in Maharashtra and Uttar Pradesh, Government of Uttar Pradesh withdrawing the low risk crops like sugarcane from coverage and introduction of Direct Benefit Transfer (DBT) by the Government in April 2017 to weed out ghost / duplicate beneficiaries while helping genuine farmers through Aadhar based verification, etc. 

(c): The scheme is in its third year of implementation and the Department has put a riorous monitoring mechanism in place in form of weekly review with all stakeholders including States, Insurance Companies, Banks and other supporting agencies, issues based meetings with concerned stakeholders including meetings of Technical Advisory Committee and meetings of National Level Monitoring Committee (NLMC) to ensure early settlement of claims under the scheme.
Contd…2/-

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(d) & (e): Pradhan Mantri Fasal Bima Yojana provides financial protection to farmers in the event of crop damage due to natural calamities. The amount of insurance claims depends largely on the crop production and extent of damage due to the weather conditions and nature of calamities. Generally, more claims are paid by insurance companies in the adverse weather conditions, while payment of claims is relatively less compared to premium, during good agriculture years. The details of insurance claims given to farmers in states / areas affected by the natural calamities in the last three seasons are as follows:

Season States Premium paid by farmers (Rs. in crore) Total Premium
(Rs. in crore) Total Estimated Claims
(Rs. in crore) Total* Claims Paid (Rs. in crore) Percentage (%) of estimated claims against premium paid by farmers (Rs. in crore) Percentage (%) of estimated claims against Total premium (Rs. in crore)
Kharif 2016 Kerala 3.12 8.57 17.92 17.87 575% 209%
Karnataka 190.38 881.77 1164.08 1151.93 611% 132%
Andhra Pradesh 181.12 680.80 648.28 643.81 358% 95%
Rabi 2016-17 Tamil Nadu 107 1217.41 3476.20 3394.88 3249% 286%
Andhra Pradesh 18.15 164.70 254.65 240.76 1403% 155%
Kharif 2017 Chhattisgarh 128.18 306.78 1303.89 1303.79 1017% 425%
Haryana 124.19 297.98 614.28 609.99 495% 206%
Madhya Pradesh 508.06 3945.79 5367.28 5307.42 1056% 136%
Odisha 145.09 835.46 1720.85 1719.35 1186% 206%
* Balance estimated claims are being paid by the concerned insurance companies.

In the country under the scheme, as against the premium collected from farmers amounting to Rs. 4216.04 crore in 2016-17, claims of Rs. 16279.25 crore have been paid to farmers. Similarly, claims of Rs. 16967.92 crore have been paid during 2017-18 (Kharif 2017) against premium collected from farmers amounting to Rs. 3038.70 crore. Details of the premium received by insurance companies and claimed paid to the farmers during last three seasons is as under:-
Contd…3/-

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(Rs. in Crore)
Sl.No. Season Gross Premium received Farmers contribution in Gross Premium Total Claims
1 2016-17 22345.51 4216.04 16279.25
2 Kharif - 2017 19767.46 3038.70 16967.92


Inspite of overall good monsoon during first two years of implementation of PMFBY, the claim ratio during 2016-17 is about 73% and during Kharif 2017, it is about 86%. Moreover, administrative and other cost for insurance company for implementation of the scheme ranges from 10 % to 12% of gross premium. 

With a view to ensure better transparency, accountability and timely payment of claims to the farmers, Government has comprehensively revised the Operational Guidelines of the scheme recently which, inter-alia, include the following :

i) Provision of 12% interest rate per annum to be paid by the Insurance Company to farmers for delay in settlement claims beyond 10 days of prescribed cut off date for payment of claims. 
ii) State Government have to pay 12% interest rate for delay in release of State share of Subsidy beyond three months of prescribed cut off date/submission of requisition by Insurance Companies.
iii) Increased time for change of crop name for insurance - upto 2 working days prior to cut-off date for enrolment instead of earlier provision of 1 month before cut off date.
iv) Rationalization of methodology for calculation of Threshold Yield (TY) to calculate claims - Moving average of best 5 out of 7 years to be taken for calculation.
v) Increase in risk coverage by inclusion of risks of cloud burst and natural fire under localized calamities and hailstorm under post-harvest losses.
vi) Time for intimation of loss due to localized calamities and post-harvest losses has been increased from 48 hours to 72 hours.
vii) Stratified grievance redressal mechanism viz. District Level Grievance Redressal Committee (DGRC), State Level Grievance Redressal Committee (SGRC).
Contd…4/-

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viii) Detailed plan for publicity and awareness - 0.5% of Gross premium per company per season earmarked for the purpose.
ix) Detailed Standard Operating Procedures (SOPs) for settlement of claims under localized calamities, post harvest losses, mid-season adversity and prevented sowing and redressal of disputes regarding yield data including add on features.
x) Inclusion of perennial crops and add on coverage for damage by wild animals on pilot basis.

Source: Loksabha

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