Centre saves Rs 11k cr on crop insurance cost

New Delhi The central government has been able to bring down the cost of farm insurance by Rs11,000 crore, thanks to the effectiveness of new tech-based initiatives. There has been a reduction in premiums under the Prime Minister Fasal Bima Yojana (PMFBY), official sources told Bizz Buzz. The premiums have been brought down by 8-9 per cent, they added.

A perception was created that insurance companies were making excessive profits, the officials said. But that was not just wrong and it also has been debunked, primarily because of the models prescribed by the Centre and adopted by States. These models have resulted in a transparent and equitable system, with reductions in premiums happening in States spread across the country. In another farmer-friendly policy move, the official said, the Centre has delinked its share of premium payment to that of States. This, they added, would ensure that farmers receive their claim payments without waiting for State actions. The Union Ministry of Agriculture will now release its share of subsidies independently, providing much-needed relief and financial security to farmers.

At present, under the PMFBY, farmers pay two per cent as premium of the sum insured in the Kharif season and 1.5 per cent in Rabi. For both seasons, they pay five per cent for cash crops. The rest of the premium is paid by the Centre and States on an equal basis.

The Centre and States release their shares at the same time. Since there is often a delay in payment by States, farmers have to wait for a long time. This will change now, the officials said.

Continuing its reliance on technology, the government recently launched YES-TECH Manual, a comprehensive guide developed after extensive testing and piloting in 100 districts of India. It facilitates the implementation of YES-TECH, a technology-driven yield estimation system, offering methodologies, best practices, and integration insights for accurate yield assessments at the Gram Panchayat level.

It also launched the Winds Portal, a centralized platform that hosts, manages, and processes hyper-local weather data collected by automatic weather stations and rain gauges at the local levels. The portal enhances risk assessment and decision making in crop insurance, agriculture advisories, and disaster mitigation, supporting the agricultural sector and rural economy, the officials said.