The crop insurance scheme, aimed to provide protection cover for farmers against crop failure, has become a highly profitable business for general insurance companies. Official data shows that the premium collected for crop insurance scheme by insurance companies in the last two years was more than three times the payout to farmers.
Information provided in the Assembly by agriculture minister RC Faldu, in response to a question by Congress MLA from Savarkundla Pratap Dudhat, shows that nine insurance companies, which include public as well as private players, were paid Rs 7,201 crore as crop insurance premium by the state and central governments in 2017 and 2018. As against this, the insurance amount disbursed to farmers in both the years was Rs 2,312 crore, i.e. 32 per cent of the total premium collected.
The premium was paid to the insurance companies by the state and central government for Kharif season 2016, 2017, and 2018, and Rabi season 2016-17 and 2017-18. The premium contributed by state government also included additional premium assistance of up to 3 per cent for cash crops and horticultural crops.
The state and Centre contributed Rs 1,058 crore and Rs 923 crore respectively in 2017, and Rs 2,610 crore each in 2018.
The information shows that the insurance companies paid Rs 1,042 crore as crop insurance to farmers in 2017, and Rs 1,270 crore in 2018.
Public sector insurer Agriculture Insurance Company of India, which was paid premium of Rs 1,650 crore in the two years, disbursed Rs 998 crore as crop insurance in the two years.
HDFC Ergo General Insurance Company, which collected Rs 1,326 crore as premium, paid Rs 730.6 crore to farmers.
The information shows that Reliance General Insurance was paid Rs 992 crore as premium for Kharif 2018 season, but it did not figure among companies that had paid crop insurance to farmers. Bharti Axa General Insurance and Universal Sompo General Insurance received Rs 264 crore and Rs 618 crore as premium respectively for Kharif 2018 season, but their names too don't appear in the list.
New India Insurance collected Rs 1,620 crore as premium for Kharif season 2017, and paid Rs 353 crore crop insurance to farmers, said the minister's reply.
SBI General Insurance collected Rs 425 crore as premium for Kharif 2017 season, while its payout was Rs 176.92 crore.
Similarly, Iffco Tokio received Rs 225 crore as premium for Kharif 2017, while it disbursed Rs 10.16 crore to farmers. It also paid Rs 10.41 crore for Rabi season 2017-18 as compared to Rs 51 crore premium.
Farmers' activists said that poor disbursement of claims is a clear indication that crop insurance schemes are for insurance companies and not for farmers. "The amount of total claims settled is less the premium paid," said Atul Shekhda, a farmers' activists from Junagadh. Sagar Rabari, founder president of Gujarat Khedut Ekta Samiti said that the claims of high payment of insurance claims by the government do not meet the eye. "Wherever I go, farmers urge me to see that crop insurance claims are settled. Looking at the ground situation, the claims feel exaggerated," said Rabari.
‘CLAIMS FEEL EXAGGERATED’
- Farmers’ activists said that poor disbursement of claims is a clear indication that crop insurance schemes are for insurance companies and not for farmers.
- “Farmers urge me to see that crop insurance claims are settled. Looking at the ground situation, the claims feel exaggerated,” said Sagar Rabari, founder of Gujarat Khedut Ekta Samiti
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
 "Farmers")
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}
)
){kind=small}
){kind=small}
)
)
)
)
)
){kind=small}
){kind=small}
){kind=small}
){kind=small}
){kind=small}