News eDaily01 Jun 2017

India:Govt makes last-mile reach to expand crop insurance

01 Jun 2017

The government has decided to tap 175,000 Common Service Centres (CSC) and post offices across the country to encourage more non-loanee farmers to take up crop insurance schemes, including the government-backed Pradhan Mantri Fasal Bima Yojana (PMFBY).

The plan is to implement the distribution scheme in the crop year beginning next month, reported The Press Trust of India.

At present, it is mandatory for loanee farmers to take up the crop insurance policy. However, the government wants both loanee and non-loanee to take advantage of PMFBY as well as weather-based crop insurance schemes.

CSCs, set up under the Ministry of Electronics and Information Technology, currently are being utilised for booking railway tickets, providing personal identification numbers and passport applications.

“The proportion of non-loanee farmers who have taken up the crop insurance policy at present is only 22%. We want to achieve 40 -50%. We have decided to use multiple platforms to reach out to them,” a senior government official said.

The existing platforms — banks, insurance companies and cooperatives — are not sufficient for the last mile connectivity to non-loanee farmers, he said. Banks are not that keen to sell crop insurance policies to non-loanee farmers, while insurance companies and cooperatives have limited reach in villages.

Insurance regulator IRDAI has already given permission to agents and intermediaries to access the CSC portal for crop insurance. This is being tested at present, he said.

The government has empanelled 13 insurance companies for the crop year starting in July to sell crop insurance policies.

The PMFBY, launched in 2015, has boosted the premium revenue of insurers that offer it. The general insurance industry is expecting total premium income from the scheme to reach INR230 billion (US$3.6 billion) for the fiscal year ending (FYE) March 2018. In FYE 2016, the premiums from PMFBY stood at INR57 billion but rose in FYE2017 to INR215 billion. Premium payments under the scheme are contributed by farmers and the central and state governments.

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