Government has launched a new crop insurance scheme – Pradhan Mantri Fasal Bima Yojana with considerable improvement over the existing National Agriculture Insurance Scheme.
The new scheme has a number of added features which may make agricultural insurance popular among the farmers besides extending more protection to them against calamities.
Following are the main features of the Pradhan Mantri Fasal Bima Yojana:
There is reduced premium for crop insurance: for Rabi crops 1.5%, Kharif crops 2% and for commercial/horticultural crops 5%. (Under NAIS, there was a cap on coverage implying that farmer can get only a fraction of the losses.)
No cap on Premium: under the new scheme, there is no cap on subsidy on premium. This means that the government will bear the cost even if the balance premium. (Similarly, the premium for commercial and horticultural crops were as high as 25 %.)
Reduces leakages and avoids intermediaries: the scheme uses the mobile based DBT platform under which money is directly transferred to the farmer. Initially 25% of the compensation will be provided through DBT.
The scheme covers localized calamities: the scheme gives crop insurance cover to the farmers against hailstorm, landslide, inundation, etc. There is post harvest coverage for cyclonic and unseasonal rainfall occurs nationally.
More coverage: the scheme aims to give crop insurance coverage to half of the country’s cropped area in the next three years. At present, the coverage is 23%.
Budget allocation and sharing with states: The budget allocation for crop insurance will be enhanced from the present Rs.2, 823 crore in 2015-16 to Rs.8000 crore in 2018-19. Centre and states will share the expenses equally.
Use of technology for mapping and uploading of crop loss data: The scheme aims to use smart phones to capture and upload data on crop cutting (to estimate loss in yield) to reduce delays in settling claims. Remote sensing will be used to map crop loss information.
The new scheme contains attractive features which may make crop insurance more interesting for farmers. Similarly, higher financial commitment by the government and reduction of premium may invite farmers to adopt Pradhan Mantri Fasal Bima Yojana.
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