Lok Sabha Question No. 394 (UNSTARRED), answered on 2020-02-04
Subject: Complaints against Crop Insurance Companies
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Rama Devi, Poonamben Hematbhai Maadam

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

## LOK  SABHA

## UNSTARRED QUESTION NO.394

TO BE ANSWERED ON THE  4 TH  FEBRUARY, 2020

## COMPLAINTS AGAINST CROP INSURANCE COMPANIES

394.   SHRIMATI RAMA DEVI: SHRIMATI POONAMBEN MAADAM:

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

- (a) whether  the  Government  has  found  insurance  companies  guilty  on  the  basis  of complaints received in regard to the crop insurance scheme;
- (b) if so, the details thereof during the last three years, State-wise;
- (c) the  action  taken  by  the  Government  against  the  insurance  companies  found  guilty; and
- (d) the outcome of the said action along with the reaction of the Government thereto?

## ANSWER

## MINISTER OF AGRICULTURE AND FARMERS WELFARE

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

(a) to (d) : During implementation of the Pradhan Mantri Fasal Bima Yojana (PMFBY), some complaints  against  insurance  companies  about  non-payment  and  delayed  payment  of claims;  under payment of claims  on account  of  incorrect/delayed  submission  of  insurance proposals  by  banks;  discrepancy  in  yield  data  &  consequent  disputes  between  State Government and insurance companies, unrealistic assessment of crop loss due to large unit area  of  insurance;  delay  in  providing  Government  share  of  funds,  non-deployment  of sufficient  personnel  by  insurance  companies  etc.,    have  been  received  in  the  past  in  the country. Most of the complaints were suitably addressed by the concerned State Government, Insurer and the Ministry.  Yield data disputes between States and insurance companies are settled by referring the matter to the Technical Advisory Committee (TAC) by the  State  or  Insurance  companies.      Further,  some  State  Governments  like  Rajasthan, Karnataka  and  Gujarat  have  debarred  United  India  Insurance  Company  Ltd.  &  Tata-AIG General  Insurance  Company  Ltd;  Shriram  General  Insurance  Company  Ltd.  and  SBI General Insurance Company Ltd. respectively for participation in tender of PMFBY for one or more seasons.

As  per  provision  of  Revised  Operational  Guidelines  of  the  scheme,  insurance companies have to pay penal interest @ 12% per annum to farmers for late settlement of claims subject to certain conditions.   Government has imposed interest penalty of Rs. 3.30 crore, Rs. 0.09 crore, Rs. 0.51 crore, Rs.0.15 crore and Rs. 0.16 crore has been imposed on Agriculture Insurance Company  of  India Ltd., Cholamandalm-MS  General  Insurance Company  Ltd.,  ICICI-Lombard  General  Insurance  Company  Ltd.,  New  India  Assurance Company  Ltd.  and  SBI  General  Insurance  Company  Ltd.  respectively  vide  letter  dated September 25, 2019.   In reply they have submitted their explanations requesting for review. A  meeting  has  been  called  to  discuss  the  explanations  submitted  by  the  insurance companies.

Apart  from  this,  State  Governments  have  been  advised  to  impose  penalties  on insurance companies themselves.  Accordingly, some State governments like Uttar Pradesh, Gujarat  and  Haryana  have  also  imposed  penalty  on  insurance  companies  for  nonperformance of certain provisions of the scheme and have deducted the penalty from State share of premium subsidy to insurance companies.

Further, a provision  of  Stratified  Grievance Redressal Mechanism viz. District Level Grievance  Redressal  Committee  (DGRC),  State  Level  Grievance  Redressal  Committee (SGRC) has been made in the Revised Operational Guidelines of the Scheme to resolve such complaints.    Accordingly, 13 States/Union Territories have notified the District/State level grievance redressal committees in their respective States.

Scheme  guidelines  also  provides  for  evaluation  of  the  working  of  the  insurance companies in implementation of the scheme.

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