Business Standard: Letters: Better insurance plans
Letters: Better insurance plans: With reference to the editorial, 'Improved crop insurance' (January 20), earlier initiatives by some states to introduce crop insurance either did not take off or their success was limited due to a half-hearted approach and lack of linkages. This
Business Standard, January 25,
2016
Letters
Better insurance plans
With reference to the editorial, "Improved crop
insurance" (January 20), earlier initiatives by some states to introduce
crop insurance either did not take off or their success was limited due to a
half-hearted approach and lack of linkages. This time around, Centre-state
participation and overall awareness about the need to make farming bankable
should make a difference. The Centre and the states should revisit the subsidies provided
to the farm sector in terms of interest, inputs and cost of electricity, pool
these and provide need-based subsidy to make individual farming economically
viable.
Although going back to the practice of three components - cash,
kind and provision of inputs, and consumption component in gross bank
credit - may not be practical, human involvement in appraisal and
supervision of credit cannot be substituted by technology.
There is an urgent need to monitor and supervise insurance schemes
through bank and insurance staff, as inadequate field supervision had
contributed to the failure of past schemes. The temptation to outsource and
depend solely on paperless reporting should be avoided.
The problems listed in the last paragraph of the editorial are
real. But insurance companies are now waking up to real-life situations. Let us
hope that where banks find the activity bankable, insurance cover is not denied
for want of a "flawless land title". It is in the interest of
insurance companies to establish the credibility of a scheme so that there is
wider coverage, which would allow cross-subsidisation of outgo for claims
settlement. Awareness should be spread among farmers about the role of
insurance as an instrument of savings to meet unexpected risks.
M
G Warrier, Mumbai
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