Crop insurance claims to AP farmers pending for want of state share in subsidy

Crop insurance claims of Rs 321.23 crore for the 2018-19 crop year have not been paid to farmers in Andhra Pradesh for want of state share of premium subsidy to insurance companies, Parliament was informed on Friday.

Union Agriculture Minister Narendra Singh Tomar in a written reply to the Rajya Sabha said total claims reported from the state were Rs 1,179.23 crore for the 2018-19 crop year (July-June). Of this, Rs 858 crore of claims have been paid to farmers. "The balance claims (Rs 321.23 crore) pertaining to Kharif 2018-19 and Rabi 2018-19 pending for want of state share of premium subsidy to the insurance companies," the minister said.

HDFC-ERGO GIC Ltd, Oriental Insurance Company, AIC of India, National Insurance Company and SBI General Insurance Company were implementing the crop insurance schemes in Andhra Pradesh during 2018-19. The government is implementing two crop insurance schemes of Pradhan Mantri Fasal Bima Yojana (PMFBY) and Restructured Weather Based Crop Insurance Scheme (RWBCIS).

Of the total pending claims, Rs 224.35 crore belongs to kharif crops while Rs 96.88 crore of Rabi season of 2018-19, the minister said while placing the data before the Upper House. The minister further said a tentative claim of Rs 465 crore and necessary bill of Rabi 2018-19 will be presented in 2-3 days for release of state share of premium subsidy. "Admissible claims for the year 2016-17 and 2017-18 have been settled," he added.

To ensure timely payment of claim, Tomar said the concerned state governments including Andhra Pradesh have been asked to take action including imposing a penalty against defaulting insurance companies as per the revised operational guidelines of the scheme. In the revised guidelines, there is a provision for timely release of state government share in three installments and settlement of claims by insurance companies without waiting for final or third installment of premium subsidy by the states and advancement of 15 days in seasonality discipline for early settlement of claims.

Penalty provisions for late settlement of claims by insurance companies and late release of funds by state governments have also been stipulated under these guidelines. These provisions include payment of 12 per cent interest rate per annum by the insurance company to farmers for delay in settlement claims beyond 10 days of prescribed cut off date for settlement of claims.

Source: The News Minute