Horticulture crop insurance: 10% enrolment in Maharashtra found to be bogus

Horticulture insurance came under scrutiny in Maharashtra after it was discovered that forged lease deeds were used to insure crops which did not exist. The Indian Express had reported how this accidental find had set off multiple alarms, with the central government ordering 100 per cent ground truthing of all insured horticulture crops for the rabi season.

Following the central government’s directive, the state agriculture department conducted intensive surveys to weed out spurious insurance cases. Cases were reported from the state, with the agriculture insurance companies being asked to perform the surveys. The survey showed that of the 82,338 cases, 8,674 were based on fake documents or about orchards which did not exist.

An internal note from the state agriculture department showed that the maximum number of cases were unearthed in Solapur- 2,715, followed by Sangli (1,395) and Jalgaon (744). There has been hardly a district which has not reported bogus insurance cases.

Three modus operandi were mainly used to insure the crop. Unregistered land lease deeds were used to insure the crop, with the original land owner in the dark. Similarly, crops that did not exist on the ground were insured and over-insurance (insuring more crops than what exists).

Farmers’ share in the premium was around Rs 9.07 crore, while the combined state and central government’s share was Rs 31.77 crore. This amount is thus saved thanks to the unearthing of the scam.

The horticulture insurance allows farmers to insure their horticulture crop by paying 5 per cent of the premium while the state and central government picks up the rest. Farmers are compensated if their crops are damaged due to extreme climate events.