Over 91.91 lakh farmer applications have been received this Kharif season in Maharashtra under the Pradhan Mantri Fasal Bhima Yogna (PMFBY), marking a sharp rise from the 84.07 lakh applications received under the scheme last year. A total of 54.24 lakh hectares of farm area has been insured under the scheme, the last date of registration for which was August 1.

Despite concerns and complaints over the scheme, PMFBY has remained popular with farmers given the loss coverage it provides. While farmers pay only 2-3 per cent of the premium, the majority is covered by the state and Union governments in equal parts. Thus, for registering a hectare of soyabean crop, a farmer needs to pay Rs 1,154 for a coverage of over Rs 54,000.

This season, the total contribution by farmers in the state has risen to Rs 607.66 crore. Along with the state and central government’s contribution, insurance companies have collected Rs 4,206.35 crores. The total coverage to the state is Rs 26,199.70 crores.

With insurance being a function of risk perceived, the majority of the applications have been received from districts where farmers have higher risk of crop loss. Aurangabad and Latur division have reported 12.75 lakh hectares and 22.64 lakh hectare area under insurance coverage.

Similarly, Amravati division has reported 11.22 lakh hectares while the Nagpur division has 1.59 lakh hectares under insurance. Districts under Aurangabad and Latur divisions constitute the Marathwada region of the state. Given the history of crop loss due to vagaries of nature, farmers in this region take the lead in getting their crops registered.

This season, the state would implement the insurance scheme in what is known as the ‘Beed model’.

Under this model, insurance companies would have to return part of the premium collected in case the compensation to be paid does not cross a certain amount. The state government had decided to implement this scheme after complaints of windfall gains made by insurance companies under the scheme. Farm leaders cutting across the party lines have taken objection to this and have called for a relook at the scheme.

Another notable feature of the scheme this season is that a portion of the crop cutting experiment would be done through technological intervention.

Crop cutting experiment is the process where a portion of the crop is harvested in the presence of officials of insurance companies, the state government and farmers to determine the yield. In case the yield is below the threshold yield, the compensation is paid to farmers.

Reports of moral hazards in the manner in which the crop cutting experiments were conducted had come from various corners, leading to the decision of introducing technological intervention.

Source - https://indianexpress.com