Crop insurance: Centre highlights reforms for quicker claim settlement and climate risk coverage
New Delhi: The Centre on Friday said it has strengthened the implementation of the Pradhan Mantri Fasal Bima Yojana (PMFBY) and the Restructured Weather Based Crop Insurance Scheme (RWBCIS) by introducing digital monitoring, stricter timelines and penalties to ensure faster settlement of crop insurance claims.
In a written reply to the Rajya Sabha, Minister of State for Agriculture and Farmers’ Welfare Ramnath Thakur said claims under PMFBY and RWBCIS are generally assessed using the area approach, based on crop yield data collected through Crop Cutting Experiments (CCEs) and technology-based yield estimation under YES-TECH, wherever applicable.
However, losses caused by hailstorms, landslides, inundation, cloudbursts, natural fires, and post-harvest damage due to cyclones, unseasonal rain and hailstorms are assessed on an individual farm basis. Such claims are evaluated by a joint committee comprising representatives of the state government and the concerned insurance company.
The government clarified that crop loss assessments under the State Disaster Response Fund (SDRF) and National Disaster Response Fund (NDRF) are meant only for relief during natural disasters and cannot be directly compared with insurance claims settled under PMFBY and RWBCIS.
To improve the speed and transparency of claim settlement, the Centre has integrated the National Crop Insurance Portal (NCIP) with the Public Finance Management System (PFMS) through the Digiclaim Module, enabling electronic processing and direct transfer of compensation to farmers’ bank accounts.
The government said that from Kharif 2024, insurance companies are automatically charged a 12% penalty for delays in claim payments through the NCIP. From Kharif 2025, state governments are also liable to pay a 12% penalty if they delay releasing their share of the premium subsidy.
The Centre has also made it mandatory for states to open escrow accounts for depositing their premium contribution in advance from the Kharif 2025 season to improve financial discipline.
As part of technology-driven reforms, the government has expanded the use of digital tools, including the CCE-Agri App, YES-TECH remote sensing-based yield estimation, integration of land records with the NCIP, and the Crop Loss Assessment App (CLAP), which has been made mandatory for assessing individual farm losses due to localised calamities and post-harvest damage.
The Centre said these measures are aimed at ensuring timely claim settlement, improving transparency and providing better protection to farmers against climate-related crop losses.
