PMFBY is a replacement scheme of National Agriculture Insurance Scheme (NAIS) and Modified National Agriculture Insurance Scheme (MNAIS) and hence exempted from the
Objectives of the Scheme
To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests & diseases.
To stabiles the income of farmers to ensure their continuous process in farming.
To encourage farmers to adopt innovative and modern agricultural practices.
To ensure flow of credit to the agriculture sector.
Coverage of the farmers
All farmers including sharecroppers and tenant farmers growing the notified crops in the notified areas are eligible for coverage. The non-loanee farmers are required to submit necessary documentary evidence of land records prevailing in the State Records of Right (RoR), Land possession Certificate (LPC) etc. moreover, applicable contract, agreement details, other documents notified permitted by concerned State Government.
Compulsory Component – All farmers availing Seasonal Agricultural Operations (SAO) loans from Financial Institutions (i.e. loanee farmers) for the notified crops would be covered compulsorily.
Special efforts shall be made to ensure maximum coverage of SC/ ST/ Women farmers under the scheme.
The Scheme shall be implemented on an ‘Area Approach Basis’ (i.e., Defined Areas) for each notified crop for widespread calamities.
For Risks of Localized calamities and Post-Harvest losses on account of defined peril, the Unit of Insurance for loss assessment shall be the affected insured field of the individual farmer.
The overall control on implementation of insurance companies will be under Ministry of Agriculture & Framers Welfare. The Ministry designated empanelled AIC and some private insurance companies presently to participate in the Government sponsored agriculture, crop insurance schemes. The choice of which private company is left to the states. There will be one insurance company for the whole state.
Management and Monitoring of the Scheme
The existing State Level Co-ordination Committee on Crop Insurance (SLCCCI), of the concerned State will be responsible for monitoring of the schemes programme in their state. However, a National Level Monitoring Committee (NLMC) under the chairmanship of Joint Secretary (Credit), Department of Agriculture cooperation and farmers welfare (DAC & FW) will monitor the scheme at the national level.
It is proposed to take following monitoring measures for effective implementation during each crop season to ensure maximum benefits to the farmers:
The Nodal Banks intermediaries may collect the list of individual insured farmers (both loanee and nonloanee) with requisite details like name, fathers’ name, Bank Account number, village, categories Small and Marginal group, Women, insured holding, insured crops, sum insured, premium collected, Government subsidy etc from concerned branch in soft copy for further reconciliation. This will be done online once the E platform is put in the place.
After receiving the claims amount from the concerned Insurance Companies, the financial institutions/banks should remit/transfer the claim amount to the account of beneficiaries within a week. This will be transferred online directly by the Insurance company into the accounts of farmers. o The list of the beneficiaries (bank-wise and insured area-wise) may also be uploaded on the crop insurance portal and website of the concerned insurance companies.
About 5 per cent of the beneficiaries may be verified by the Regional Offices/ Local level Offices of Insurance Companies who will send the feed back to concerned District Level Monitoring Committee (DLMC) and State Government/ State Level Coordination Committee on Crop Insurance (SLCCCI).
At least 10 per cent of the beneficiaries verified by the insurance company may be cross verified by the concerned District Level Monitoring Committee (DLMC) and they should send the feed back to State Government.
1 to 2 per cent of the beneficiaries may be verified by theHead Offices of the insurance company/ Independent Agencies appointed by the Central Government/ National Level Monitoring Committee and they should send the necessary feed back to Central Government.
Exclusive web portal and mobile app
The Government of India has recently launched an Insurance portal for better administration, coordination, proper dissemination of the information and transparency for the framers. An android based “Crop Insurance App” has also been launched which could be downloaded from the website of Crop Insurance, Department of Agriculture cooperation and farmers welfare (DAC & FW).
Apart from yield loss, the new scheme will cover post-harvest losses also. It will also provide farm level assessment for localised calamities including hailstorms, unseasonal rains, landslides etc
New crop insurance scheme (PMFMY)has the potential to deal with the vagaries of nature on Indian farming. The premium to be paid by the farmers is kept low when compared with earlier crop insurance schemes. However, the scheme will increase the financial burden on the government and necessary budget allocations should be made.Some states may face financial constraints in encouraging famers to take up crop insurance.The scheme also does not address the demand of farmers to cover the risks and losses inflicted by wild animals.Besides, losses from nuclear risks, riots, malicious damage, theft, and act of enmity, are all categorized under ‘exclusions’ in the new scheme.
Challenges in Implementation
Success of any government scheme depends on its sincere implementation. The key problems such as poor land records, flawed land titles, corruption etc. are common challenges any crop insurance scheme in India faces. Further, the success of the scheme depends on how sincerely it is implemented by the insurance companies. Further, we need to wait and watch as to how the scheme is monitored and supervised.
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