The government announced the launch of new crop insurance scheme which will have lower premium amount and faster settlement of claims. In addition to lower premium amount and quick settlement of the claims this scheme also spelled out the use of new technologies, including use of drones, remote sensors etc, to assess the extent of damage the crop has faced.
Agriculture Minister Radha Mohan Singh, at the time of announcement of new modified crop insurance scheme, said that they propose an average premium of up to 2.5% for foodgrain and oilseeds crops and 5% for horticulture crops.This proposed premium amount was discussed in detail during the meeting with Prime Minister.
The arrival of correct premium rate is vital for the new scheme to be implemented as during the previous year agriculture minister had discussed the same in the cabinet last year alsobut could not be implemented on account of difference over premium rate.
According to government sources the government exchequer would face the outflow of Rs. 8,000 crores per annum if the premium is fixed at 2.5% and 5% respectively as stated above and if 50% of the total cultivation area of 194 million hectare is insured.
The new crop insurance scheme is expected to be rolled out by June 2016, said an official from the government.
Last year, where only 27% of the crop area was insured under Modified National Agriculture Insurance Scheme, the government had to incur an expenditure of Rs. 1,350 crores. Under this scheme the average premium rate was kept at 5.5%.
