Lok Sabha Question No. 373 (UNSTARRED), answered on 2019-11-19
Subject: Delays in Claims of PMFBY
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Sanjay Jaiswal

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE DEPARTMENT OF AGRICULTURE, COOPERATION AND FARMERS WELFARE

## LOK  SABHA UNSTARRED QUESTION NO.373

TO BE ANSWERED ON THE 19 TH  NOVEMBER, 2019

## DELAYS IN CLAIMS OF PMFBY

373.   DR. SANJAY JAISWAL:

Will the Minister of AGRICULTURE AND FARMERS WELFARE कृ ष एवं कसान कयाण मंी be pleased to state:

- (a) whether it is a fact that there are delays in release of claims to farmers under Pradhan Mantri Fasal Bima Yojana (PMFBY), if so the details thereof and the reasons therefor;
- (b) whether there are instances where insurance companies have unduly benefitted from the scheme  by  having  a  monopoly  in  a  district  and  going  slow  on  issuing  insurances  during  a drought year and if so, the details thereof; and
- (c) the details of reforms taken to improve the scheme?

## ANSWER

## MINISTER  OF AGRICULTURE AND FARMERS WELFARE

कृ ष एवं कसान कयाण मंी (SHRI NARENDRA SINGH TOMAR)

- (a): As per provisions of Pradhan Mantri Fasal Bima Yojana (PMFBY) admissible claims are generally  paid  by  the  insurance  companies  within  two  months  of  completion  of  Crop  Cutting Experiments/harvesting  period  subject  to  availability  of  yield  data  and  total  State  share  of premium subsidy from concerned State Government within time. However, settlement of claims in some States get delayed due to reasons like delayed transmission of yield data;  late release of  their  share  in  premium  subsidy  by  some  States,  yield  related  disputes  between  insurance companies and States, non-receipt of account details of some farmers for transfer of claims and NEFT related issues, etc.  However, this Department is regularly monitoring the implementation of PMFBY including timely settlement of claims.  Penalty provisions for late settlement of claims by  insurance  companies  and  late  release  of  funds  by  State  Governments  have  also  been stipulated under the scheme.
- (b): No  such  incidence  has  been  reported  by  any  State  Government.  However,  loanee farmers  are  compulsorily  covered  for  notified  crops/areas.    Non-loanee  farmers  can  insure themselves through  Common  Service  Centres  and  directly  online  on  Natioal  Crop  Insurance Portal  (CIP).    Further,  for  transparency  and  monitoring  purposes  individual  farmers  data  is uploaded on the NCIP.

(c): With a view to ensure better transparency, accountability,  timely payment of claims to the farmers and to make the scheme more farmer friendly, Government has comprehensively revised the Operational Guidelines of the Pradhan Mantri Fasal Bima Yojana (PMFBY) which have become effective from Rabi 2018-19.   To ensure optimal coverage under the scheme, the following provisions, which will facilitate higher enrolment and early settlement of claims, making the scheme even more farmer friendly, have, inter-alia,  been made in the Revised Operational Guidelines:-

- (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 cutoff 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).
- (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 adds on coverage for damage by wild animals on pilot basis.

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