Among the more successful national insurance schemes targeted to safeguard crops, the Rashtriya Krishi Bima Yojna was introduced by the government in the year 1999-2000 and was designed to protect the farmers against failure of their crops. These crops included but were not limited to Wheat, Barley, Maize, Ginger, Paddy and Potato. The government has been met with proposals of adding many more crops under this scheme but the crops nominated are still under review. The Rashtriya Krishi Bima is an open scheme for those who have not yet availed a loan from a nationalized bank towards their farms and crops. However this scheme is a compulsory scheme for those farmers who have availed loans as it acts like an insurance policy and covers the farmers’ crops.
Think of this policy as an insurance policy given out during home loans. If the home under a loan is damaged through fire and other natural calamities, the insurance policy covers the damage and leaves the borrower with enough cover to fix the house and not worry about loan instalments and repair expenses. Similarly the Rashtriya Krishi Bima Yojna acts as an insurance policy for the crops especially for farmers with loans as they cover the damages borne by the farmer by protecting the crops against natural calamities such as wildfires, droughts, hailstorms, floods, infestations and diseases etc.
This scheme provides comprehensive risk insurance against the yield losses created by the above factors and is being implemented by the AICI or Agriculture Insurance Company of India. Farmers of a particular state can enjoy the cover of this policy and any loss in yields will be borne by the state and central government in an equal manner. Not only does the policy provide risk cover it also offers premiums that farmers can afford with premiums being offered with added subsidy. The policy began implementation of an added subsidy on premium of about 50%. This was raised from its earlier 10% and has been implemented since Rabi, 2007-08. The subsidies are offered to all small and marginal farmers. You can check life insurance policies as well.
Objectives of the Rashtriya Krishi Bima Yojna Scheme:
- The scheme is to act as an insurance policy and provide cover and financial support to farmers in the event of any failure of their notified crops
- The scheme will promote farmers to take up the advanced and progressive farming practices and switch from depending on rainfall to forms of irrigation such as the drip irrigation system. It also encourages farmers from moving away from manual equipment to adopting mo. It also encourages farmers from moving away from manual equipment to adopting more advanced technology that allows farmers to increase their yield
- To provide cover and stabilize the farmer’s income during disaster years where rainfall was low enough to qualify it for a drought, during pestilence, or any other natural calamity
- The policy is compulsory to all farmers who are growing notified crops and have availed seasonal agricultural operations loans or SAO loans. This policy will be open and optional to those farmers who are growing notified crops but have not availed SAO loans
Risks Covered by the Rashtriya Krishi Bima Yojna:
The policy offers comprehensive risk cover against the following non-preventable risks:
- Natural wild fires and fires caused by lightning strikes
- Storms and derivatives such as Hailstorms, Tornadoes, Cyclones, Hurricanes, Typhoons and Tempest
- Floods and excessive water flows caused by inundations, overflowing riverbanks, mudslides and landslides
- Lack of rain leading to droughts and dry spells
- Damages caused by infestation of pests, rodents and diseases of crops causing massive crop failure
The seasonality discipline depends on the type of farmer and varies for loanee farmers and optional or non-loanee farmers. This discipline is subject to modification in consultation with State and Central Governments wherever necessary.
For Loanee Farmers:
- Loaning period for Kharif is April to September
- Loaning Period for Rabi is October to Next March
- The Cut-off date for receipt of declarations for Kharif is November and for Rabi is May
- The Cut-off date for receipt of yield data for Kharif is January/ March and for Rabi is July/ September
For Non-Loanee farmers the broad cut-off dates for receipt of proposals for Kharif season is by 31st July and for Rabi season is by 31st December.
The policy provides risk against failure of crops thereby securing the farmers income and also encourages them to adopt progressive farming techniques and equipment. This policy will bring about an indirect effect on other fields such as manufacturing, servicing and an overall boost to economic growth and keep the farming credit in circulation. This policy will soon transform itself from a simple insurance policy into an integral component for the agricultural sector.
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