Sukhbir Singh, a farmer who cultivates a small field in village Amboli of district Jhajjar in Haryana has no clue about the crop insurance scheme of the government. Despite being a holder of kisan credit card, whose insurance premium is deducted at regular intervals under Pradhan Manti Fasal Bima Yojna (PMFBY), he is unable to file a claim for crop loss.
Singh does not know the details of crop insurance cover provided to him, not even the name of the crop and the acreage. The only thing he knows is that he lost his cotton crop grown in six acre in 2017. When he approached the bank he was told that he was insured for paddy only (he grows both paddy and cotton) and is not eligible for insurance claim for other crop.
There are thousands like him in Haryana, who pay the insurance premium, without knowing the modalities of the insurance. Crops are insured without any field visit by the officials of the insurance companies who complete the documentation without procuring the accurate and requisite details and farmers fail to seek the claim due to negligence of the insurance companies.
While the farmers are in a quandary, officials in the state are sanguine over the implementation of the PMFBY. Sources in Haryana Government informed Tehelka that the state has settled the claims (approved and disbursed) worth 1140 crore since the implementation of PMFBY ( January, 2016) against the gross premium of 818 crore. The claims settled for Kharif 2016-17 were
234.16 crore and for Rabi 2016-17 were 57.02 crore. The same for Kharif 2017-18 was 781.05 crore and for Rabi 2017-18 was 68.68 crore. The officials added that most farmers in Haryana are credit linked and there are 33 lakh KCC (Kisan Credit Card) holders in the state and 5.98 lakh farmers have been issued claims. Only defaulters are out of loop of the PMFBY.
Going by the facts provided by the state government officials, the insurance companies stand to incur a loss of about 322 cr during the four seasons (Kharif and Rabi 2016-17, Kharif and rabi 2017-18). It may seem unviable for a business outfit but can fetch long run dividends to the insurance provider.
A detailed investigation of the facts available with the state government reveals that the highest amount of the claims was provided in Sirsa district. Out of the total claims, this pre-dominantly cotton growing district of Haryana has allegedly received 200 cr of insurance claims. A further scrutiny of the data unfolds that the average yield of cotton was calculated to be 7 quintal per hectare for the purpose of insurance. This is far less than the actual average yield of cotton in this region that remains close to 12 quintal per hectare. As there were no weather vagaries and pest attacks during the period that is covered under the PMFBY, moreover the cotton production and market arrivals also remained consistent, the claims of the state government seem erroneous. This appallingly low yield may create a benchmark yield of cotton and any yield higher than this will not be accepted for claim.
The sources close to Tehelka revealed that the state government expedited the distribution of insurance claims sensing the growing unrest of farmers and the political compulsion of general elections. There is no uniformity in the distribution of claims and farmers have been reimbursed for only 2016-17 crop loss. The institutions are short of hands and are trying to create a euphoria among rural voters by distributing claims before the announcement of the final dates of general election and the code of conduct.
Haryana is divided into three clusters; two clusters having seven districts each and one having eight districts for the purpose of crop insurance. Three insurance companies Reliance Insurance, ICICI Insurance and Bajaj Allianze were initially assigned the task of crop insurance in the state under PMFBY. After a plethora of complaints of rejection of claims for cosmetic errors these companies were replaced with Universal Sompo, Oriental Insurance and SBI General Insurance.
The bankers in the state apprised that were already over-burdened with the umpteen schemes of the centre and state government and crop insurance is like a last straw in camel’s back.
“Insurance is not our cup of tea. In agriculture lending, the scale of finance is decided as per the crop and it is different for different crops. Farmers, at times seek loan for one crop and grow some other crop. They may also grow a combination of crops but premium is deducted for the crop for which loan was taken. The details required for crop insurance are more inclusive than the crop loan. The insurance companies do not do the leg work. The entire blame falls on banks”, told a banker.
As per the operative guidelines of Ministry of Agriculture, Government of India, District Level Monitoring Committees have to be formed to address the grievances of the farmers. In order to resolve the local issues of the farmers, Insurance companies have been directed to appoint officials in district headquarters. The companies committed to adhere to the guidelines but are yet to deliver.
According to Guni Prakash, a farmer from Jind and In-Charge of Bhartiya Kisan Union (Haryana), the PMFBY has made the things more complicated for farmers. “Prior to this scheme, the farmers could approach the Deputy Commissioner of the district for the crop loss and he used to order special girdawari. Individual farmers were also compensated for the crop loss. PMFBY has incorporated banks and insurance companies who do not guide us. We are not informed about the process of insurance and do not know whom to meet if we have queries. It is only during run-up-to elections that some activity is taking place in Haryana, post-election the peasant would be back to square one”, he added.
Farmers in all parts of the state lament that before the launch of scheme no attention is paid in creating awareness. The information travels only with the word of mouth and carriers of information are mostly the illiterate farmers. Their situation is like the phrase ‘out of the fire into the frying pan’ because earlier they were incurring losses but neither paying premium nor getting insurance cover. Now the premium is an extra burden because the probability of getting claim is bleak.
Ground Realities of PMFBY
- Group Insurance and not an individual cover.
- Claim criterion is Gram Panchayat.
- Minimum 35 per cent loss is must.
- Farmers are not provided any document. They do not know how much acreage and which crop is insured in their name and what are the terms and conditions.
- The field is not visited by the officials of insurance companies or banks when the crop is insured. Many times, wrong crops are insured. When the team visits to verify the claim, the claim is rejected due to wrong crop.
- Option of change of crop is not there.
- As per guidelines, claim is to be given with in 15 days, but most farmers do not get it even in four months and sometimes it becomes an ordeal.
- The headquarters of the Insurance Companies are in state capitals, not approachable by farmers.
- The anomalies exist in calculating loss as the official appointed by the state government is usually from the revenue department and not an expert in agronomy.
- The assessment of loss is made on the basis of average production of last seven years. But there are areas where the yield remains low due to natural calamities and lack of irrigation facilities. Thus, the average yield remains low and farmers do not get benefit.
Punjab did not accept the PMFBY proposed by the Government of India. Though the Union Ministry of Agriculture made amendments in the original draft of crop insurance on the basis of feedback of the states, it was not commensurate with the demands of Punjab. The suggestions made by the Punjab Government were not incorporated in the revised guidelines of PMFBY so the state government decided to conceive its own crop insurance policy to match the needs of enterprising but distressed farmers of Punjab.
The state government then engaged the Punjab State Farmers’ and Farm Workers’ Commission to prepare a policy in this regard. The Chairman of the Commission Ajayvir Jhakar informed Tehelka that the policy has been formulated and submitted to the state Government very recently. “This policy will be different from PMFBY and will be financially beneficial for the farmers”, he apprised. Now it rests with the state government has to approve and roll out the crop insurance policy for the farmers of the state, he added.
The farmers in Punjab, particularly in Malwa belt which also known as cotton growing belt of Punjab suffer huge loss and need insurance cover as cotton crop is susceptible to pest attack. The pest ‘white-fly’ caused extensive damage to cotton crop in Punjab in 2015-16 and many farmers committed suicides due to economic repercussions of crop loss. The wheat crop is also damaged in the state due to yellow rust (a fungal disease).
Besides this, the hail storm and other weather vagaries undermine the yield of different crops in different parts of the state. Though paddy and wheat are the major crops followed by cotton, sugarcane, maize and potato; horticulture crops like kinnow and oilseeds are also grown in Punjab.