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On Wednesday, the General insurance sector applauded the Union Budget 2017 and appreciated the governments’ decision to hike the coverage under Pradhan Mantri Fasal Bima Yojana (PMFBY) from 30% to 40 % in 2017-18, and it will be increased from 40 percent to 50 percent in 2018-19.
Spending on PMFBY by the government has been increased to Rs. 13,240 cr., the insurance industry believes that it is a great step, as it will provide insurance coverage to more farmers.
G Srinivasan, CMD New India Assurance said that Risk mitigation mechanism for Indian farmers is the need of the hour. With the help of insurance and PMFBY, they will be provided compensation if their crop is damaged by the natural disasters.
As a part of the scheme(s) in the current financial year, premium worth Rs. 1,100 crore has been underwritten by New India Assurance. As part of their plans for the next fiscal year, they have planned to hike it to approx to Rs. 2,000 crore.
Sanath Kumar, MD National Insurance chairman said that the hike in the insurance coverage under PMFBY will hike the premium rate by 15 to 20 percent by the insurance industry in the next financial year.