SC verdict on payment of crop loss compensation comes as a major relief for Osmanabad farmers  

The Supreme Court’s (SC) decision dismissing an appeal of Bajaj Allianz General Insurance Company against the Bombay High Court order asking it to compensate over 3.5 lakh farmers in Osmanabad for the loss of soyabean crop due to heavy rain in 2020 under the Pradhan Mantri Fasal Bima Yojana (PMFBY) comes as a major relief to farmers facing unpredictability in the climate.

In May, the Bombay High Court directed  Bajaj Allianz General Insurance Company to compensate Osmanabad farmers. The company contested that compensation cannot be paid for farmers who had not filed claims within the 72-hour period of the crop damage and had approached SC. 

Unseasonal rains and hailstorms hit badly for the last few years causing massive damage to kharif and rabi cultivation. In December 2021, the State Grape Growers’ Association had estimated a loss of ₹10,000 crore to grape cultivators. “Mango, onion, grapes and all kharif and rabi crops have been damaged due to unpredictability of rains in the last couple of years. It has been raining intermittently almost all the year,” says farmer Ashok Jadhav from Sangli. While Lata Waghmare from Beed says that farmers are under tremendous stress due to the unpredictability of climate.

According to the reports, the SC on Monday referred to climate change saying these kinds ( heavy rains) of incidents are going to increase with climate change. The Union Ministry of Agriculture admits that climate change is perceptible through a rise in all-India mean temperature and increased frequency of extreme rainfall events in the last three decades. This causes fluctuation in the production of major crops in different years. Farmers in Maharashtra have been complaining that insurance companies are denying their claims and Osmanabad farmers had approached the Court to seek compensation. 

SC observations

The SC observed that this was insurance of a different kind where the crop, family and everything of farmers is at stake. A Bench comprising Chief Justice Uday Umesh Lalit and Justice S Ravindra Bhat ordered the release of ₹200 crore deposited by the insurance firm with the apex court’s registry along with the interest accrued on it to the government treasury in Osmanabad. The top court ordered the completion of the process of payment of insurance compensation in three weeks, strictly under the law, and under the supervision of the District Collector.

Earlier, the High Court, while directing the insurance firm to compensate the farmers, had said that if the company failed to pay then the State government should compensate the farmers for the crop loss. “If the amount is not paid by the insurance company...the State government is directed to pay such claim for compensation for post-harvest loss caused to the soyabean crop in kharif season 2020 to remaining 3,57,287 agriculturists of Osmanabad district within a period of six weeks thereafter,” the High Court had said.

The High Court order had come on a batch of petitions of farmers challenging the denial of insurance coverage for their post-harvesting losses. The High Court was also informed that the insurance company received over ₹500 crore as a premium under the Pradhan Mantri Fasal Bima Yojana from farmers in Osmanabad.

State’s own crop insurance company

The Maharashtra government has been tapping the possibility of launching its own crop insurance company on the demand of farmers. Former Deputy Chief Minister Ajit Pawar had mooted this proposal before the ruling government was toppled after revolting in Shiv Sena.

The new government under rebel Shiv Sena leader Eknath Shinde has not made clear its stand on the proposal.

( With PTI inputs) 

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