New Delhi:
The Pradhan Mantri Fasal Bima Yojana (PMFBY) at Rs 14,000 crore has received a higher allocation in 2019-20 in the Budget 2019-20.
In 2018-19, the scheme had got an allocation of Rs 12,975 crore.
“The higher outlay for crop insurance would not necessarily result in higher participation from the general insurance companies, as the previous budgeted expenditure was utilised only till 72 per cent, said Karthik Srinivasan,senior vice president and group head – Financial Sector Ratings
ICRA Ltd
Launched early 2016, farmers pay a very nominal premium and get a full claim for the crop damage.
The PM Fasal Bima Yojana a major initiative towards farmers, for them to feel secure against natural calamities at the time of sowing.
The government also intends to make enrolment of farmers under the scheme voluntary.The agriculture ministry has migrated from administered premium & claim-support insurance schemes to an upfront subsidy for actuarial premium- based system. The part liability of claims of previous years (prominently Kharif 2015 and Rabi 2015-16 have also to be paid along with the upfront premium subsidy under PMFBY for Kharif and Rabi 2018-19.
It is a demand driven scheme, therefore no targets are fixed. However, it was decided to increase the coverage up to 50 percent of total cropped area.
The crop insurance scheme aims to support sustainable production in agriculture by providing financial support to farmers suffering crop damage or loss arising out of unforeseen events. The scheme was launched on April 1, 2016 to ensure the flow of credit to the agriculture sector, which will in -turn contribute to food security, crop diversification.
PMFBY was launched in 2016 after rolling back earlier schemes National Agriculture Insurance Scheme (NAIS), Weather-based Crop Insurance scheme, Modified National Agricultural Insurance Scheme (MNAIS).