Timeline Fixed for settlement of claims under PMFBY

The operational guidelines of the Pradhan Mantri Fasal Bima Yojana (PMFBY) prescribed the timeline of two months of completion of Crop Cutting Experiments/harvesting period for settlement of claims by insurance companies.

• This timeline is subjected to conditions like timely release of subsidy and yield data to the insurance companies.

What were the reasons for the delay in settlement of claims?

• Delayed transmission to yield data.
• Dispute raised by Insurance Companies on yield data.
• Reconciliation of individual farmer data on the portal by bank branches.
• Late release of their share in premium subsidy by some States.
• NEFT related issues.

About the revised guidelines to overcome the delays:

• Provision of 12% interest rate per annum to be paid by the Insurance Company to farmers for any delay in settlement of claims beyond 10 days of prescribed cut off date for payment of claims.
• State Governments are required to pay 12% interest rate for delay in the release of the State share of Subsidy beyond three months of prescribed cut off date/submission of requisition by Insurance Companies.

About the Pradhan Mantri Fasal Bima Yojana (PMFBY):

• Pradhan Mantri Fasal Bima Yojana (PMFBY) is the government-sponsored crop insurance scheme that integrates multiple stakeholders on a single platform.
• It was supposed to provide a breakthrough by enhancing the coverage of the crop insurance and protect the farmers from the vagaries of the monsoon.
• Under the scheme, there is a uniform premium of 2% to be paid by farmers for all Kharif crops, 1.5% for all Rabi crops and 5% in case of annual commercial and horticultural crops. 
• The balance premium would be paid by the government. 
• The scheme is being implemented in an area-based approach.

Question:

Q. The operational guidelines of the Pradhan Mantri Fasal Bima Yojana (PMFBY) prescribed what timeline of completion of Crop Cutting Experiments/harvesting period for settlement of claims by insurance companies?
a. One Month
b. Two Months
c. Three Months
d. Four Months