Farmers in India Complain about crop insurance Scheme PMFBY

Intending to provide financial support to farmers, Prime Minister Narendra Modi launched Pradhan Mantri Fasal Bima Yojana (PMFBY). PMFBY aims to support farmers in terms of sustainable production of crops irrespective of troubling events. Additionally, it promised to migrate the intrinsic challenges faced due to climate changes.

The Working of the Scheme

At the beginning of the farm year, farmers and the government will pay the premium. In return, the insurers would compensate in cases of crop loss. Risk coverage includes risks associated with sowing, harvesting, post harvest and natural calamities. Non preventable risks including drought, rainfall deficit, floods, inundation, pests and diseases, etc covered under the scheme

Problems Confronted by Farmers Regarding PMFBY

The farmers across the country suspect that the scheme’s beneficiaries are just the insurance companies. Accordingly, cultivators have alleged that payments of insurance claims under the scheme have been negligible or non-existent. Moreover, they do not issue signed copy of the scheme receipts. Thereby, farmers knowledge about the terms of the contract is limited.

The Aam Kisan Union Members Break Down the Miscalculation

The key to calculating insurance claims under PMFBY are threshold yield, actual yield, and scale of finance. It was revealed that farmers were paid 62.5% of their actual claim. Due to which certain farmers received INR 4543 per acre for the soybean crop. However, insurance amount paid was INR 1700 per acre. Many farmers suffered losses under this scheme due to low payment of claims.

Some Errors in PMFBY scheme

Reports suggest that farmers haven’t gained profit despite the scheme. Because the premiums collected were higher than the compensation paid. Furthermore, the area correction factor plays a major role in the reduction of the scale of finance. Thus, diminishing the claim amount. Besides, data entry errors lead to incorrect claims affecting the farmers.

Consequently, many cultivators have taken these government-owned insurance companies to consumer court. As a result, On 23rd January, 23 farmers received Rs 50,000 each as additional claim pays out. However, the whole scheme must undergo a lot of improvements to benefit the farmers. This additional payout can be considered as an initial restoration measure and there are yet many to follow.

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