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Crop Insurance :: Guidelines to Financial Institutions

Guidelines to Financial Institutions

  • The new crop insurance scheme i.e. National Agricultural Insurance Scheme (NAIS) is being implemented in the Kharif 2000 season in our state, for the benefit of all farmers i.e. loanee and non-loanee farmers).
  • The scheme broadly covers food crops, oil seeds and annual commercial/horticultural crops. For specific details of notified areas, crops and premium rates kindly refer to the notification issued by the State Level Co-ordination Committee on Crop Insurance (SLCCCI).

Loanee Farmers :

  • Under the scheme, insurance coverage is compulsory for all loanee farmers availing Seasonal Agricultural Operations (SAO) loans from financial institutions (FIs) for notified crops in notified areas up to the full loan amount.
  • Additional coverage under the scheme is also available (at the option of farmer), beyond the loan amount
  • upto the value of Threshold Yield (TY) at normal premium rates and
  • upto the value of 150% of Average Yield(AY) at actuarial premium rates.
  • The value of TY and AY are arrived at by multiplying TY and AY respectively, with the Minimum Support Price (MSP) announced by Govt. of India.

Premium Rates

Sl. No Crops Premium rate for Loanee & Non-Loanee Farmers
Upto Value of TY (i.e. Normal Rates) Beyond Value of TY to 150% value of AY (i.e. Actuarial Rates)
1 Bajra & Oilseeds 3.5% of SI or Actuarial rate, whichever is less Actuarial rates
2 Cereals, Other millets & Pulses 2.5% of SI or Actuarial rate, whichever is less Actuarial rates
3 Annual Commercial / Horticultural crops Actuarial rates Actuarial rates
Important: In case of Loanee farmers full amount of loan is eligible for normal rates irrespective of the value of TY and/or AY.

PremiumRates

  • Premium by the nodal banks should be remitted by way of a single demand draft/instrument for a particular lot of Declarations. However, separate instruments are to be drawn for loanee and non-loanee farmers.
  • The FIs should extend additional loan beyond the scale of finance towards premium.
  • The FIs shall submit consolidated crop insurance Declarations separately for each crop, each notified area on monthly basis through the designated nodal offices as per the prescribed cut-off dates.
  • Loanee farmers seeking additional coverage over the loan amount shall be offered coverage subject to observing the cut-off dates as applicable to non-loanee farmers.
  • KISAN CREDIT CARD LOANS : The FIs shall also compulsorily cover all crop loans disbursed through Kisan Credit Cards (KCC) and shall establish necessary controls and maintain backup registers for smooth and effective coverage of the loans. In case the total loan amount for a particular crop withdrawn through KCC during the season exceeds the sub-limit fixed for the crop (during the season), the sum insured shall be limited to the extent of the sub-limit fixed for such crop (and season) in the KCC. The KCC sub-limits for consumption, medium term loans, allied activities and uninsurable crop loans are not eligible for coverage.
  • All guidelines in regard to crop loans, issued by RBI/NABARD have to be complied with by the FIs.

Non-Loanee Farmers

  • Coverage is also available for all non-loanee farmers, on optional basis.
  • The FIs shall also receive individual proposals from non-loanee farmers seeking coverage, scrutinize the proposals, accept premium, consolidate the proposals and route them through their designated nodal offices within their Service Area as per the cut-off dates prescribed. All non-loanee farmers seeking coverage should operate a bank account with the bank branch.

General
Service Charges

  • The FIs shall be paid, service charges @ 2.5% of the premium collected in respect of both loanee and non-loanee farmers at the end of the season.
  • Separate Declaration formats as per enclosed proforma are to be used for loanee and non-loanee farmers. FIs shall obtain required number of copies of the Declaration formats at their cost.
  • Nodal banks must ensure coverage of all crop loans and shall obtain full and accurate particulars from all the FIs within their jurisdiction. They must also ensure coverage of proposals received from all non-loanee farmers within their jurisdiction as per prescribed cut-off dates.
  • Correct premium rates should be ascertained from the Notification issued by us and premium computation (Sum insured X Premium rate) should be done accurately. In respect of Small and Marginal farmers (i.e. farmers with a land holding of less than 2 hectares) only net premium (full premium less subsidy) need to be remitted. Remission of excess premium shall not entitle for increase in sum insured/liability, at a later date.
  • Whenever, any clarification in respect of Declarations submitted by FIs is sought by GIC, the same must be submitted within two weeks. Thereafter, GIC is not under obligation to accept the same, including reopening of claims. Declarations received after the prescribed cut-off dates will be rejected and the responsibility/liability for such proposals rests with the nodal banks/FIs. The FIs shall only be liable/responsible for all omissions/commissions/errors committed by them.
  • Claims under this Scheme will be settled only on the basis of yield data furnished by Directorate of Economics and Statistics arrived at through regular crop estimation surveys for production estimates (i.e planned Crop Cutting Experiments) and not on any other basis such as Annavari, declaration of drought, declaration of floods, Gazette notification etc., by any department / authority.

HORTICULTURE / PLANTATION (INPUT) POLICY
PROPOSAL FORM


1. Name of Proposer

:

 

2. Address

:

 

3. Occupation (Other than Agriculture)

:

 

4.Details of Horticulture/ Plantation crop

:

Sugar Cane
  1. Village / Taluka :
  2. District :
  3. State :

 

 
Name of Crop Variety Survey Gat No. Hissa No. Acreage No. Type under Crop Depth of Soil Ph of Soil
                 
                 
Number of Plants Distance between Plants Age of Plant Date / Month of Planting Expected Date / Month of Harvest Sum Insured
           
           
  1. Are the plants dully grown and in good condition?
  2. If plants are not in good condition, what is the deficiency / disease?
  3. What is the recommended dose of fertilizers?
  4. What dose of Fertilizers & manures are given per year?
  5. What is the source of irrigation? Is it available around the year?
  6. How are the plants irrigated?
  7. What is the frequency of irrigation during the year?
  8. If regular source of irrigation dries in summer, what alternative arrangements are made?
  9. What are the plant protection measures taken?
  10. What are the other Agricultural practices being followed? (Other than mentioned above)
  11. Has the crop been pledged or hypothecated to any institution / Dealer? If so, give full details
  12. Is the Land under cultivation fully owned by you? If not, what is the propriety of this insurance?
  13. What efforts are taken to minimise losses arising out of the vagaries of nature?
  14. Is the insured land low lying (Flood prone)?
  15. Source of seed material
  16. Type of seed material (Seeds/Seedlings/Budded cuttings)
  17. Is the crop to be insured a regular crop of this region, or is it being cultivated on an experimental basis?

Previous loss experience (At least for three years)

Year Amount of loss Date of loss Loss cause by
       
       
  1. List use of adjacent property within fifty feet on all sides

    East :
    North :
    South :
    West :

    Kindly submit a sketch (demarcated map) of the property and its surroundings with crops grown therein.
  2. Will there be inter-cropping? If ‘Yes’, give details.
  3. Name and address of financing agency/bank : Rs.
  4. Amount of finance from agency/bank : Rs.
  5. Is "NABARD" refinance involved : (Yes/No)
  6. Previous insurance history:-
    1. Has any company declined to cover your property?
    2. Has any company cancelled your insurance policy?
    3. Has any company refused to renew any policy?
    4. Name of previous insurers:
    5. Sum insured:
    6. Premium:
    7. Claims, if any:
    8. Has any company imposed any restriction or special conditions? If so, give details:
  7. Is there any other use of the land on which the proposed plantation stands?
  8. Give details of security arrangement, if any:
  9. Will you be availing any technical guidance? If Yes, give the following details:-

i. Name & address of institution:
ii. Name & qualification of person:
iii. Details of guidance:

  • We confirm having completed the proposal from myself, ourselves after reading the prospectus fully.
  • All the statements made above and the answers given are wholly true and correct to the best of my knowledge and belief. I have disclosed all particulars material to the risk. It is hereby understood and agreed that the statements, answers and particulars are basis on which the insurance is being granted. If after the insurance is affected, it is found that the statements, answers of particulars are incorrect or ---- in any respect the insurance company shall be under no liability under this insurance.

Place : 
Date :

(Signature of Proposer)

 
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