Telangana Government Favours Making Crop Insurance Scheme Voluntary For Farmers
A farmer works in a millet field while cattle graze nearby on the outskirts of Bengaluru, India. (Photographer: Dhiraj Singh/Bloomberg)

Telangana Government Favours Making Crop Insurance Scheme Voluntary For Farmers


The Telangana government is in favour of the Centre’s plan to make crop insurance scheme voluntary for farmers under the Pradhan Mantri Fasal Bima Yojana, citing delayed payment of claims and farmers’ reluctance to give premium, among other reasons, sources said.

In order to make the PMFBY more effective, the Centre is planning to implement changes like making crop insurance voluntary to all farmers, removal of high premium crops and giving flexibility to states to provide customised add-on products.

The Union Agriculture Ministry has sought views from state governments on this.

The Telangana government, sources said, has suggested to the Agriculture Ministry that it is better to make PMFBY voluntary to farmers because they have reservations about the "area approach basis" of the crop insurance scheme and are reluctant to pay premium where there is less risk.

The state government has also said that farmers are not happy with the rejections and delayed payments of claims by the insurance companies, they said. Further, the state government informed the agriculture ministry that the crop insurancescheme was made compulsory in 1985 under comprehensive crop insurance scheme for loanee farmers in the country and is still continued under PMFBY also.

“As could be seen, in spite of compulsory nature of the scheme, only 12 to 15 percent of eligible farmers are covered and the participation by non-loanee farmers on voluntary basis is very meagre,” the state government has said.

The state government noted that the coverage of loanee farmers is largely because of efforts of the Department of Agriculture and banks as insurance companies have no infrastructure and manpower in rural areas, the sources added.

Among key suggestions, the sources said the Telangana government has asked the Centre to announce cut-off dates well before the start of the season, ensure that insurance companies create infrastructure and required manpower in rural areas.

It also recommended that state governments may utilise the services of agricultural officers available in the field to enroll the farmers.

Launched in April 2016, PMFBY provides comprehensive crop insurance from pre-sowing to post-harvest period against non-preventable natural risks at extremely low premium rate of 2 percent for kharif crops, 1.5 percent for rabi crops and 5 percent for horticulture and commercial crops.

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