The budget for the Pradhan Mantri Fasal Bima Yojana (PMFBY) could be increased from Rs 10,701 of the current fiscal year to Rs 13,000 in the coming year 2018-19, reported PTI.
Under the crop insurance scheme, farmers pay a nominal premium and get the full claim on crop damage. The PMFBY was launched in 2016 and was initially alloted Rs 9,000.75 crore for the current fiscal year. The requirement was increased by Rs. 1,701 through supplementary demands.
The increase in budget allocation is based on 10% likely increase in sum insured. The agricultural department has demanded a Rs. 11,000 crore budget for the next fiscal year but is hopeful of receiving more funds from the finance department.
The total claims of insurance for crops in the crop year July 2016 to June 2017 is estimated to be Rs 15,500 crore. Rs 12,313 crore of the Rs. 13,661 crore reported claims had been settled as per official data. A total of 5.70 crore farmers have purchased the crop insurance policy in the crop year 2016-17.
A farmer's premium has been kept low at 1.5-2% for food grains and oilseed crops, and up to 5 percent for horticultural and cotton crops. There is no cap on the premium, and 25 percent of the likely claim will be settled directly in farmers' accounts.