Windfall for crop insurance firms

By Times Of India on 01 Mar 2018 | read
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BHOPAL: The crop insurance scheme of the state government is proving to be extremely profitable for insurance companies but, not so much for the farmers. This was revealed through a question raised by Congress MLA from Baihar assembly seat Sanjay Uikey to agriculture minister Gauri Shankar Bisen.
windfall
The answer provided by the state government to the assembly revealed that in the year 2016, insurance companies collected a premium of Rs 2,850.27 crore for kharif crops, while farmers’ claim for crop damages was for only Rs 1,686.15 crore — which meant insurance companies profited by a whopping Rs 1,164.12 crore.

There is also no mention of how much has been actually paid to settle claims made by the farmers. Rs 1,686.15 crore was the amount claimed for damages in the agrarian sector but the actual payment may be much lesser than what was claimed.

Though the question could not come up in the assembly on Tuesday as the House was adjourned, the day’s agenda listed it with an answer supported by statistics.

In his question to the agriculture minister, Uikey asked how much money has been raised from farmers to pay premium for crop insurance, the total premium deposited and how much was paid by the insurance companies to settle claims.

According to the state assembly statistics, a total of 38,47,819 farmers were insured for kharif crop in the year 2016 by three insurance companies, including HDFC ERGO, ICICI Lombard and AIC (Agriculture Insurance Company) for an insured amount of Rs 17,647.37.

Farmers paid premium of Rs 375 crore, while the state government exchequer paid Rs 1,237.62 crore and the Union government another Rs 1,237.62 crore.

Thus, the total premium was Rs 2,850.27 crore. For kharif crop damages that year, farmers in Ashoknagar claimed Rs 144.52 crore, in Guna Rs 212.3 crore, in Shivpuri Rs 125.52 crore, in Vidisha Rs 403.61 crore, while other districts of the state claimed much lesser amount.

Kharif crops this year has been insured for a total premium of Rs 2,537.09 crore covering 34,25,550 farmers. For an insured amount of Rs 24,404.37 crore, farmers have paid Rs 503.79 crore, while the Madhya Pradesh and Union governments have paid Rs 1,016.65 crore each.
 

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