States can set up insurance firms to provide crop insurance, says Govt.

Dispelling concerns that private insurers are profiting from the crop insurance scheme PMFBY, Agriculture Minister Radha Mohan Singh today said even states have now been allowed to set up their own insurance companies.

Pradhan Mantri Fasal Bhima Yojan (PMFBY), launched in 2015, is being implemented by five public and 13 private insurance companies which are empanelled. Under the scheme, premium to be paid by farmers is kept low and the claims are fully settled.

Responding to a question in the Rajya Sabha, Singh said the settlement of claims during the two years preceding 2016- 17 remained higher because of bad weather (drought). But claims in 2016-17 were less on account of good rains.

"If states feel they are burdened to pay their share of premium to private insurers (during good monsoon period when claims are normally less), then we have asked them to set up their own insurance firms to implement the scheme," he said, adding that Punjab and Gujarat have evinced interest in this.

Replying to another question on action taken to improve farmers' plight and reduce the number of farmers' suicide, the Minister said the government has revamed the old farm schemes and launced some new initiatives to reduce the cost of production and increase income.

Admitting that farmers are in distress because of good production year, the Minister said the government is lending support to farmers through various market interventions to ensure support price to their produce.

Farm produce like tur and potato are being procured under the central schemes -Price Support Scheme (PPS) and the Price Stablisation Fund (PSF) to protect the interest of farmers, he added.