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Government to Expand Social Security Net With New Launch of Farm Health Insurance

With the colossal success of banking, insurance, and pension schemes, the Central Government is preparing to launch a new and affordable social security scheme to deal with the nation-wide distress in the Agriculture and Farming sector.

Called as the Bhartiya Krishi Bima Yojana, this is an all-inclusive insurance product for farmers in an effort to make healthcare affordable for weaker sections of the society. Prime Minister Narendra Modi will announce this new universal scheme on the Independence Day. This Unified Package Insurance Scheme would provide a single sum insured cover for all the family members.

With surmounting incidences of suicides by farmers, the Bhartiya Krishi Bima Yojana will bring a huge relief to the farming community. The Unified Package Insurance Scheme will combine 9 features with obligatory crop insurance. However, to avail subsidy under the crop insurance section, farmers must opt for a minimum of four other features, as indicated in the draft prepared by the finance ministry.

The government has proposed improved features in the draft because the previous schemes failed to render the expected results. According to the proposal, the policy includes different products such as, health cover, crop insurance, life insurance, student safety insurance, cattle/live-stock insurance, personal accident insurance, and insurance cover for agriculture tools like tractors and pump sets. The discussion is underway with all the key stakeholders.

Bhartiya Krishi Bima Yojana is aimed at rendering financial protection to farmers, thus ensuring crop diversification, food security, enhancing growth and competitiveness in the agriculture sector while protecting the farmers from financial risks.

K.K. Srinivasan, former IRDA Member alleged, “Currently, the sum insured under this scheme includes the loan taken by the farmer. The claim is computed based on the deficit in yield ratio to the sum insured. Now, the government has moved a step further and will be covering farmer’s income loss.”

The draft on the Unified Package Insurance Scheme reveals two types of covers. The first one involves sum assured of Rs. 50,000 upon paying a premium of Rs. 700 annually. While, the second one pays a sum assured of Rs. 100,000 with an annual premium of Rs. 1,300. Furthermore, the scheme will cover cashless hospitalization for contracted diseases or sustained injuries by the insured individual. Any pre-existing disease will be incorporated post a waiting period of 24 months.

Bhartiya Krishi Bima Yojana will be applicable to all families not exceeding five members and that includes families headed by senior citizens. Four state-owned insurers (National Insurance Company, New India Assurance, Oriental Insurance, and United India Insurance) and private insurers (Bajaj Allianz, ICICI Lombard, Iffco-Tokio Marine, and HDFC Ergo) are currently in talks with the government to finalize the details of the policy.

Source: This news was published on August 13, 2015 in financialexpress.com under the title: “Govt set to unveil farm, health insurance for masses”