Many concerns have been raised that private insurers are making huge profits from the Pradhan Mantri Fasal Bhima Yojan (PMFBY), the crop insurance scheme. Radha Mohan Singh, the agricultural minister, said in the Rajya Sabha, that the states have been now allowed to set up insurance companies to provide crop insurance.
Presently, 13 private and 5 public insurance companies are impaneled to implement the PMFBY which was launched in 2015. Claims are fully settled and the premium is kept low under this scheme.
Singh also said that the claims were higher in the last two years due to drought, but his year there has been a drop in the claims. He added that as the states are feeling pressurized to pay their premium share to the private insurers, they have been given the permission to set up their own insurance companies.
She also announced that adequate steps have been taken to extend the coverage to more farmers. Now non-loanee farmers are also allowed to take this insurance though earlier the scheme was only extended to loanee farmers. The crop insurance coverage will be increased to 40% from 30% last year, he said.