State mulls forming its own crop insurance firm

After the Shiv Sena created noise over the poor payouts for farmers from insurance companies, before the Assembly elections last year, the Uddhav Thackeray-led state

After the Shiv Sena created noise over the poor payouts for farmers from insurance companies, before the Assembly elections last year, the Uddhav Thackeray-led state government has now appointed a cabinet sub-committee to study the existing crop insurance scheme. The sub-committee will tap into the possibility of forming a separate insurance company owned by the government and also weed out the flaws in the existing scheme.

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The Sena had staged a protest under the leadership of party chief Thackeray in July 2019, alleging the private insurance companies benefit from the poor payouts given to farmers as compensation for crop loss. After assuming power in the state, the Thackeray government is looking at bringing about changes in the scheme.

According to the officials from the agriculture department, despite the acute drought, the farmers got ₹3,400 crore compensation against the ₹3,700 premium paid to the companies. The state and the Centre pay 49% each of the premiums, while the farmers pay 2%.

The state government had received complaints from farmers about the meagre compensation despite having paid heavy premiums. The Fadnavis government, too, had requested the Centre to tweak the existing policy, said the official.

Agriculture minister Dada Bhuse said that the sub-committee will suggest the steps to be taken to improve the existing insurance scheme. “If the need arises, we will approach the Centre to make changes in the existing crop insurance scheme. Crop insurance plays a key role during times of distress and natural calamities. We are committed to offer respite to farmers,” he said