The government is implementing its ambitious farm insurance schemes, Pradhan Mantri Fasal Bima Yojana (PMFBY) and the Unified Package Insurance Scheme, without involving the four public sector general insurers, which control almost 50 per cent of the market share. “We had strongly pleaded with both the agriculture ministry and Ministry of Finance to be part of the scheme but it seems we have not been allowed. May be they may allow us in the second phase,’’ said the chairman of a public sector general insurance company. The agriculture ministry has empanelled only 11 private sector companies and state-owned Agriculture Insurance Company (AIC) to implement the new schemes. “Four PSU insurers have a wide reach and they are capable of taking these schemes to all the corners of the country. But by keeping them away, the schemes may not achieve the desired results,” said an insurance source adding that there has been heavy lobby by the private sector insurers to exclude the Public sector insurers. The General Insurers’ (Public Sector) Association of India (GIPSA) — the body of National Insurance Company, New India Assurance Company, Oriental Insurance Company and United India Insurance Company — has been arguing that the four PSU insurers should be considered as they have 9,000 offices and 3 lakh agents across the country. But this plea has fallen on deaf ears. On the other hand, private players have been lobbying for the exclusion of PSU insurers, officials said. PSU non-life insurers have been at the forefront of government sponsored socially relevant insurance schemes all along. “It is therefore surprising that they seem to have been excluded form PMFBY. These PSUs have a wide network and presence which is a crucial factor in successful implementation of the ambitious PMFBY. Their reported exclusion raises a question mark on the success of the scheme. It is also not clear as to the criteria adopted in reportedly excluding them. Lack of transparency and openness gives room for suspicion and allegation of foul play in selection criteria,” said K K Srinivasan, former member, IRDAI. As per the scheme, the farmers’ share of premium under PMFBY will be based on one season, one rate. While the farmers will have to pay only 1.5 per cent of premium for rabi crop, they will be asked to pay 2 per cent of premium for kharif crop. The remaining premium will be paid as subsidy by the Centre and states together. The scheme will be rolled out from the coming kharif season beginning June and the Centre and the states together will involve an annual outgo of Rs 8,800 crore in terms of subsidy which will be equally shared. The premium was 3.5-8 per cent under the two existing schemes so far. The existing National Agricultural Insurance Scheme (NAIS) and Modified National Agricultural Insurance Scheme (MNAIS) are being replaced by the PMFBY. Besides, a Pilot Unified Package Insurance Scheme aimed at covering all the insurance needs of the farmers including crop insurance, tractor insurance etc would be piloted in 45 districts across the country from next kharif season. Furthermore, the existing Weather Based Crop Insurance Scheme and Coconut Palm Insurance Scheme would continue to operate but the premium to be paid under WBCIS has been brought on par with PMFBY. Only one-fifth of farmers had insured their crops. “…81 per cent were found to be unaware of the practice of crop insurance. Of the uninsured, 46 per cent were found to be aware but not interested while 24 per cent said that the facility was not available to them. Only 11 per cent felt that they could not afford to pay the insurance premium,” said an Assocham-Skymet Weather joint study released last year. The study says that there are about 32 million farmers who have been enrolled in various crop insurance schemes across India. However, issues in design, particularly related to delays in claims settlement, have led to farmers not being covered, despite significant government subsidy. In 2014-15, AIC settled Rs 5,167.58 crore in claims and underwrote Rs 2,750 crore in premium. Source - indianexpress.com