The CSE report says insurance companies had benefited by a cumulative Rs 10,000 crores in profit as on April, due to low claims reported in relation to the premium charged.
The gross direct premium of general insurance companies grew by 32 %, from Rs 96,376 crores in 2015-16 to Rs 1.27 lakhs crores in 2016-17, half of which came from crop insurance.
The CAG report as presented in the Parliament recently mentioned the observation on crop insurance schemes – National Agriculture Insurance Scheme (NAIS), Modified NAIS and the Weather Based Crop Insurance Scheme (WBCIS), implemented during 2011-12 through 2015-16. It analysed the new Pradhan Mantri Fasal Bima Yojan (PMFBY), which replaced all these schemes from kharif 2016 onwards.
Fundamental problems and issues remained almost the same in both schemes. The CSE study says till this April, insurance companies collected a gross premium of Rs 15,891 crores, against claims of only Rs 5,962 crores, ensuring a profit of almost Rs 10,000 crores.
In PMFBY, the rule says claims must be paid to farmers within three weekdays of yield data by insurance companies; yet, on-ground claims made for kharif 2016 were not fully settled.
