Express News Service
NEW DELHI: Agriculture insurance companies are raking in huge profits as claims paid by these companies have been consistently dipping in the past few years. In 2022, the gross premium-to-claim settlement ratio was reduced to 21 per cent.
The latest data tabled in the Parliament by Union Minister for Farmers’ Welfare, Narendra Singh Tomar, shows that agriculture insurance premium has been going up while claims payment is down, under the Pradhan Mantri Fasal Bima Yojana, the flagship agriculture insurance programme launched in 2016 for farmers to insure their yield loss.
In 2019-20, the ratio of gross premium-to-claims paid to farmers was 84 per cent, which reduced to 66 per cent in 2020-21, 60 per cent in 2021-22 and 21 per cent in 2022-23. In the first three years of the programme’s launch, the gross premium collection to payment of claims was high. It led to many private firms leaving the scheme. Later, most of them joined again.
Every year, farmers protest over non-payment or delayed payment of claims across the country. There has been a slight decrease in the premium collection since 2019-20, but registered a drastic decline in claims payment.
The consistent decline in payment of farmers’ claims doesn’t augur well with sector experts. “There is a structural flaw in the programme. These insurance companies do business with banks that provide loans to farmers. Banks directly transfer premiums to companies. There is no connection between farmers and insurance companies,” said activist Ramandeep Singh Mann, who protests on behalf of farmers.
“The ground reality is that farmers who face crop loss due to inclement weather is clueless about the contact person to report their losses within 72 hours as per rule,” said Mann. The Centre has acknowledged the widespread complaints from farmers against insurance companies.
Moreover, there are disputes between insurance firms and state governments on discrepancies in yield data, delay in providing state government’s share of funds, non-deployment of sufficient personnel by insurance companies, etc. “We are rectifying it,” said a senior PMFBY official.
NEW DELHI: Agriculture insurance companies are raking in huge profits as claims paid by these companies have been consistently dipping in the past few years. In 2022, the gross premium-to-claim settlement ratio was reduced to 21 per cent.
The latest data tabled in the Parliament by Union Minister for Farmers’ Welfare, Narendra Singh Tomar, shows that agriculture insurance premium has been going up while claims payment is down, under the Pradhan Mantri Fasal Bima Yojana, the flagship agriculture insurance programme launched in 2016 for farmers to insure their yield loss.googletag.cmd.push(function() {googletag.display(‘div-gpt-ad-8052921-2’); });
In 2019-20, the ratio of gross premium-to-claims paid to farmers was 84 per cent, which reduced to 66 per cent in 2020-21, 60 per cent in 2021-22 and 21 per cent in 2022-23. In the first three years of the programme’s launch, the gross premium collection to payment of claims was high. It led to many private firms leaving the scheme. Later, most of them joined again.
Every year, farmers protest over non-payment or delayed payment of claims across the country. There has been a slight decrease in the premium collection since 2019-20, but registered a drastic decline in claims payment.
The consistent decline in payment of farmers’ claims doesn’t augur well with sector experts. “There is a structural flaw in the programme. These insurance companies do business with banks that provide loans to farmers. Banks directly transfer premiums to companies. There is no connection between farmers and insurance companies,” said activist Ramandeep Singh Mann, who protests on behalf of farmers.
“The ground reality is that farmers who face crop loss due to inclement weather is clueless about the contact person to report their losses within 72 hours as per rule,” said Mann. The Centre has acknowledged the widespread complaints from farmers against insurance companies.
Moreover, there are disputes between insurance firms and state governments on discrepancies in yield data, delay in providing state government’s share of funds, non-deployment of sufficient personnel by insurance companies, etc. “We are rectifying it,” said a senior PMFBY official.
