Agri Business

PMFBY: No insurance firms bid for 3 clusters in Maharashtra

T V Jayan New Delhi | Updated on May 23, 2020

Farmers in as many as eight districts in Maharashtra may not be able to insure their crops under the PM Fasal Bima Yojana (PMFBY) scheme in the forthcoming kharif season as no insurance firm came forward to bid for three clusters in the State.

The last day for bidding for 12 clusters – each cluster has between one and four districts – was last Wednesday (May 20), and there were no takers for three clusters, and two others had just one bidder each, according to sources in the know of things.

These districts are Aurangabad, Beed, Bhandara, Gondia, Jalna, Kolhapur, Palghar and Raigarh.

While Beed is a cluster with single district, Jalna, Gondia and Kolhapur form one cluster. The other four districts are part of another cluster which equally failed to attract bids. Besides, two newly-formed single district clusters — Latur and Osmanabad — have bids from only one crop insurance firm, the Agricultural Insurance Corporation of India (AIC).

“One can understand why insurance companies are reluctant to offer crop insurance cover in clusters such as Beed, Latur and Osmanabad (which traditionally have some of the highest claim rates), but it is surprising to see there are no takers for the Cluster No. 6 comprising Palghar, Raigarh, Aurangabad and Bhandara, which has relatively low premium rates and lesser number of claims,” the sources said.

While Bajaj Alliance Insurance Co Ltd and Iffko-Tokio Insurance Cp Ltf bid for five clusters each, AIC, Reliance Insurance Co Ltd and HDFC Ergo bid for three clusters each. Bharti Axa General Insurance sought to work in two clusters.

Poor participation

Similarly, the other crop insurance scheme – Weather Based Crop Insurance Scheme – too failed to excite the insurance firms, prompting the State agriculture department to extend the deadline till May 28 citing ‘poor participation’.

The flagship crop insurance scheme launched by the Narendra Modi-led NDA government was in bit of trouble in Maharashtra since the previous kharif season, particularly.

Heavy rains and floods during the fag end of the previous monsoon season resulted in huge crop loss in the State, especially in Marathwada region.

As a result, insurance firms offering risk cover under PMFBY scheme had to shell out 120 per cent of total premium collected in the State.

During the rabi seasonn that has just gone by, insurance firms didn’t come forward to offer PMFBY cover to farmers.

According to the sources, the government is in two minds: whether to repeat bidding process only for those three clusters or for all clusters in the State.

Published on May 23, 2020

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