PMFBY Implementation Requirements Quiz
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Questions and Answers

Which major activity is NOT required of empaneled Insurance Companies for the implementation of PMFBY?

  • Conducting pilot studies for new technology
  • Creating a new insurance policy (correct)
  • Implementing a grievance redressal mechanism
  • Deploying adequate manpower for CCEs

    • What percentage of incremental increase in non-loanee coverage is required at the district level for each season?

  • 15%
  • 5%
  • 20%
  • 10% (correct)

    • What must Insurance Companies deploy to ensure effective outreach of the Scheme?

  • Financial incentives for farmers
  • Traditional advertising in urban areas
  • Robust digital applications (correct)
  • Advanced marketing strategies

    • Which app is specifically mentioned as compulsory for empaneled Insurance Companies to use?

    <p>CCE Agri App</p> Signup and view all the answers

    What is the purpose of the grievance redressal mechanism that Insurance Companies must create?

    <p>To register and resolve complaints</p> Signup and view all the answers

    What is the specified service charge percentage that Banks must receive from the farmer's premium?

    <p>4%</p> Signup and view all the answers

    When must the detailed planning for IEC activities be submitted by Insurance Companies?

    <p>Before the start of each season</p> Signup and view all the answers

    What aspect of the Scheme involves settling claims for farmers?

    <p>Claim settlement under Basic Cover</p> Signup and view all the answers

    What is the average yield growth rate calculated over the last 7 years?

    <p>6.25%</p> Signup and view all the answers

    What is the Threshold Yield for the year 2021?

    <p>1,183</p> Signup and view all the answers

    Which indemnity level is consistently described throughout the contract period?

    <p>70%</p> Signup and view all the answers

    How must the yield growth rate in preceding years be rounded?

    <p>Rounded to two decimal places</p> Signup and view all the answers

    Under the variable threshold yield approach, how is the Threshold Yield determined?

    <p>Recomputed every year based on actual crop yield of the previous year</p> Signup and view all the answers

    What must be evaluated to notify yield for each crop in a district?

    <p>Growth rate of the crops</p> Signup and view all the answers

    How is the L1 Company determined in the tender process?

    <p>By quoting the lowest weighted average premium rate</p> Signup and view all the answers

    What does an increase or decrease in the threshold yield affect?

    <p>Premium rate determination</p> Signup and view all the answers

    What is the primary reason for ensuring caution during the tender process?

    <p>To prevent the distortion of future rates and insurer participation</p> Signup and view all the answers

    Under what condition is re-tendering permissible?

    <p>Due to inadequate participation of insurance companies</p> Signup and view all the answers

    What must State/UTs upload on the NCIP for effective communication?

    <p>Meeting notices and tender documents</p> Signup and view all the answers

    What happens if the L1 bidder withdraws their bid?

    <p>Financial losses may be recovered from the withdrawing bidder</p> Signup and view all the answers

    What guidelines govern the bidding and negotiation conditions?

    <p>Central Vigilance Commission guidelines</p> Signup and view all the answers

    What initiates the termination of the contract by either party?

    <p>Issuing a written notice under specific conditions</p> Signup and view all the answers

    What is the minimum percentage of Gross Cropped Area that defines a crop as major in a district?

    <p>25%</p> Signup and view all the answers

    What penalty applies if a party terminates the agreement for reasons not specified in the guidelines?

    <p>A penalty of up to 5% of total premium</p> Signup and view all the answers

    When should the work order be issued after the opening of bids?

    <p>Within 2 weeks</p> Signup and view all the answers

    Which document must be included in the bid document according to the guidelines?

    <p>Conditions stipulated by State/UT Government</p> Signup and view all the answers

    What action is required if an insurer objects to a tender condition?

    <p>Reference to the State/UT Government with a copy to GoI</p> Signup and view all the answers

    What is the role of the State/UTs in notifying crops and areas under the scheme?

    <p>To specify crops and defined areas for the operational scheme</p> Signup and view all the answers

    What should be done with documents like addendums and notifications of award?

    <p>Upload them on the Document Management module of NCIP</p> Signup and view all the answers

    What is the primary calculation used to determine the Threshold Yield of a notified crop?

    <p>Average Yield multiplied by the Indemnity level</p> Signup and view all the answers

    What happens to the Indemnity level during the entire contract period?

    <p>It remains the same as prescribed in the tender</p> Signup and view all the answers

    What data must be uploaded on the Portal before floating the Tender?

    <p>Last 10 years Average Yield and Threshold Yield data</p> Signup and view all the answers

    How is the Threshold Yield calculated for a multi-year contract?

    <p>By applying a fixed yield method or laddered method</p> Signup and view all the answers

    Which of the following details is NOT required to be published with the tender for risk analysis?

    <p>Crop yield in different climatic conditions</p> Signup and view all the answers

    What does a negative average growth rate in yield indicate for the Threshold Yield?

    <p>Threshold Yield will remain constant for the crop</p> Signup and view all the answers

    What is the primary basis for fixing a ceiling on premium rates by the State/UT Government?

    <p>Statistical evaluations and loss cost analysis</p> Signup and view all the answers

    What formula is used to calculate the Threshold Yield?

    <p>Best 5-year yield summed and multiplied by Indemnity level</p> Signup and view all the answers

    How is the lowest weighted premium of a district calculated?

    <p>Using insured area data from the previous season</p> Signup and view all the answers

    What must be prescribed in the tender for each crop and IU combination?

    <p>Indemnity level and Threshold Yield</p> Signup and view all the answers

    How is the premium rate determined for the tender process?

    <p>On the basis of lowest weighted average premium rate</p> Signup and view all the answers

    What is the timeframe for releasing a work order after the Tender opening?

    <p>Within 2 weeks</p> Signup and view all the answers

    In case of reorganizing existing districts, what happens to the indemnity level?

    <p>A weighted average calculation is performed</p> Signup and view all the answers

    Which category does NOT include the information about crops in the bidding process?

    <p>Financial eligibility of farmers</p> Signup and view all the answers

    What data is included for the calculation of L1 if new notified crops are introduced?

    <p>30% of the average net sown area of the last 3 years for major crops</p> Signup and view all the answers

    What remains constant when applying the Fixed Threshold Yield method?

    <p>The premium rates for the insurance policies</p> Signup and view all the answers

    How should the evaluation of yields for different crops be conducted at the district level?

    <p>Through a crop-specific simple average of yields</p> Signup and view all the answers

    What format should the insurance companies use for submitting bids?

    <p>Separate envelopes for Ceiling and regular crops</p> Signup and view all the answers

    What is an implication of using a laddered Threshold Yield approach?

    <p>It requires consistent annual yields</p> Signup and view all the answers

    What should be included in the tender document regarding crops with ceiling premium rates?

    <p>Names of such crops</p> Signup and view all the answers

    Which data is expected to be available through the NCIP?

    <p>Crop-wise historical Coverage and Claim data for the past 3 years</p> Signup and view all the answers

    Which yield data is considered for calculating the Threshold Yield?

    <p>The best yield from five out of the last seven years</p> Signup and view all the answers

    How does the Threshold Yield affect the insurance premium rates during the contract period?

    <p>They remain constant if the Threshold Yield stays the same</p> Signup and view all the answers

    Which aspect of crop classification is considered for bidding evaluations?

    <p>Classification of irrigated and unirrigated districts</p> Signup and view all the answers

    Which requirement involves Automatic Weather Stations?

    <p>Details must be provided as per WINDS Manual 2023</p> Signup and view all the answers

    What happens if the risk propensity does not support actuarial rates offered?

    <p>The crops may be removed from the proposed list</p> Signup and view all the answers

    What additional data must be uploaded for the current tender?

    <p>Sum Insured and Indemnity Values for the current tender</p> Signup and view all the answers

    What is the minimum duration for which a Notification should be issued to aid banks in premium deductions?

    <p>One year</p> Signup and view all the answers

    What factors does the SLCCCI consider for notification regarding crop risk coverage?

    <p>Availability of local farmers, past yield data, capacity for yield estimation</p> Signup and view all the answers

    Which data format should States/UTs provide to Insurance Companies for risk assessment?

    <p>Soft format in Excel sheet</p> Signup and view all the answers

    How many minimum CCEs should be planned for irrigated and un-irrigated crops when proposing separate notification?

    <p>Minimum CCEs unspecified</p> Signup and view all the answers

    What could be the maximum deviation for notifying additional IUs within a district at the same premium rate?

    <p>10%</p> Signup and view all the answers

    What responsibilities does the Insurance Company have in regards to the tender document?

    <p>Scrutinize the tender document for details</p> Signup and view all the answers

    How many years of past yield data is required for calculating TY and Loss Cost?

    <p>10 years</p> Signup and view all the answers

    What is the maximum indemnity level provided in the scheme?

    <p>90%</p> Signup and view all the answers

    What should be part of the notification when notifying a crop?

    <p>Level and name of notified area of IU</p> Signup and view all the answers

    What incentive does the GoI provide to each primary worker for conducting crop cutting experiments?

    <p>Rs. 150 per CCE</p> Signup and view all the answers

    In case of discrepancies in the tender document, who will be liable for additional claims?

    <p>Both the State/UT Government and the Insurance Company</p> Signup and view all the answers

    What is the Average Yield of a notified crop based on?

    <p>Best five years out of the last seven years</p> Signup and view all the answers

    What should be avoided when notifying both irrigated and rainfed crops in the same IU?

    <p>Moral hazard</p> Signup and view all the answers

    What happens in case of creation/reorganization of any new IU after tender finalization?

    <p>New IUs are included with same terms</p> Signup and view all the answers

    What is the primary purpose of the grievance redressal system outlined in the content?

    <p>To resolve complaints and queries of farmers.</p> Signup and view all the answers

    What is mandatory for all farmers to avail crop insurance starting from the Kharif 2017 season?

    <p>Aadhaar Number.</p> Signup and view all the answers

    What documentation must be uploaded by enrolment channels except for banks enrolling loanee farmers?

    <p>Bank Passbook and Crop Sowing Certificate.</p> Signup and view all the answers

    What is required from states before commencing the first crop season regarding agreements with insurance companies?

    <p>A formal agreement based on a model shared by GoI.</p> Signup and view all the answers

    What is the maximum duration for tenders issued by states for the assurance of business to insurance companies?

    <p>Three years.</p> Signup and view all the answers

    Which of the following is NOT a method for submitting farmer details to NCIP?

    <p>Direct phone calls to the bank.</p> Signup and view all the answers

    Which detail is essential to be validated with bank records after digitizing farmer information?

    <p>Farmers' Land Records.</p> Signup and view all the answers

    What must enrolment agencies do concerning farmers without an Aadhaar ID?

    <p>Obtain proof of Aadhaar enrollment.</p> Signup and view all the answers

    What is a critical aspect of the Operational Guidelines concerning transparency in the tendering process?

    <p>Mandatory disclosure of details in the tender document.</p> Signup and view all the answers

    Which of the following is NOT mentioned as a requirement of the insurance companies in the agreement with the states?

    <p>Submitting annual financial reports.</p> Signup and view all the answers

    Which feature is essential for implementation of the PMFBY scheme by enrolment channels?

    <p>Infrastructure and resources for key activities.</p> Signup and view all the answers

    What is not a particular detail included in the tender document as per the outlined process?

    <p>Insurance company financial status.</p> Signup and view all the answers

    Which of the following is the responsibility of states regarding the tendering process?

    <p>Issuing tender notices at least three months prior to the crop season.</p> Signup and view all the answers

    Which aspect must be regularly reviewed by banks concerning accounts of loanee farmers without Aadhaar?

    <p>Enrollment for Aadhaar.</p> Signup and view all the answers

    Study Notes

    Insurance Company Empanelment and Participation

    • Insurance companies accepting provisions, modalities, and guidelines of schemes must deploy resources for PMFBY.
    • Key activities include pilot studies for using new technology, widening scheme outreach (at least 10% increase in non-loanee coverage per season/district), deployment of staff for observing CCEs (using Agri App, CROPIC App, etc.), and allocation of resources for IEC activities (including stakeholder awareness and capacity building).
    • Detailed planning (submitted to Centre/State/UT) must precede each agricultural season.
    • Insurance companies must create a grievance redressal system (covering sub-district, district, state, and national levels), settle claims within timelines, and pay service charges to banks and intermediaries.
    • Standard operating procedures (SOPs) and manuals are provided by the GoI for awareness and capacity building, and for grievance redressal processes.

    Bank and Other Channel Participation

    • Banks, CSCs, other channels, and insurance intermediaries must deploy resources to implement PMFBY, following scheme provisions and Operational Guidelines.
    • They create digital credentials for users, enter farmer details on the NCIP (using APIs or manually), and digitize insured farmer data (including Aadhaar, mobile, land, area, IUs, crops, and bank accounts).
    • Copying and uploading required documents (e.g., land, bank, and crop sowing certificates) is required by all channels, except bank-enrolled loanee farmers.
    • Farmers' premium must be remitted timely through NCIP's linked payment gateway.
    • Grievance redressal and resolution of farmer complaints are required within timelines outlined in the separate GoI SOP/Manual.

    Aadhaar Information

    • Aadhaar is mandatory for crop insurance from the Kharif 2017 season.
    • Farmer enrollment under PMFBY is possible without Aadhaar if they enroll for Aadhaar and submit proof, following GoI notification 334 (Feb 8, 2017).
    • Banks must compulsorily verify Aadhaar numbers before granting crop loans (under Kisan Credit Card), prohibiting loanee farmer coverage without Aadhaar.

    State-Insurance Company Agreements

    • State/UTs and Insurance Companies must sign agreements before the start of the first crop season, referencing a model agreement available on NCIP.
    • Agreement details include roles/responsibilities and performance evaluation metrics. Penalties are also part of the agreement.

    Tendering and Notification Procedures

    • States/UTs are required to use a 3-year tender period to ensure longer-term commitments from Insurance Companies.

    • Individual State/UT approval from GoI is necessary for shorter tender periods (less than 3 years).

    • A model tender document is provided by the GoI.

    • A meeting of the SLCCCI is essential before the first crop season to finalize tender terms.

    • Tender documents must include details of crops, areas, sum insured, average yield, threshold yield (at IU level), and premium rates. Historical yield data (last 10 years) for all crops must be provided through the NCIP.

    • States/UTs must consider historical coverage and claim data (past 3 years).

    • The lowest weighted premium for a district is calculated using the insured area for notified, major, and minor crops from the last year, or immediately preceding year (if last year's data is missing).

    • An L1 bidder cannot withdraw bids after the tender opening. A penalty is applicable.

    • The state can stipulate a premium ceiling if risk profile or historical loss-cost justify it.

    • Insurance companies may challenge tender conditions.

    • States/UTs must notify the chosen crops, areas, and implementing agencies— following the "Area Approach." IUs are defined.

    • Risk coverage options (Basic, Add-on) must be clarified.

    • The SLCCCI may use CCE data from prior seasons with adequate sampling when evaluating crops. (consider aspects such as the existence of past yield data and the capacity for yield estimation).

    • Data are to be provided in a standardized format.

    • Additional IUs/de-notifying of existing IUs is possible (with maximum 10% deviation to already notified IUs for a crop at a district level).

    • Additional crops/IUs created after tender finalization are to be added to the scheme in the next season.

    • States/UTs must notify crops, areas, and implementing agencies

    • Indemnity levels (70%, 80%, 90%) are to be finalized for notified crops by State/UTs and the SLCCCI and must be included in tender documents.

    • Threshold Yield (based on past 7-year data and the chosen indemnity level) is to be included and remains unchanged for a given contract period unless new IUs are created or negative yield growth is observed.

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    Test your knowledge about the essential activities required of empaneled Insurance Companies for the Pradhan Mantri Fasal Bima Yojana (PMFBY). This quiz covers important aspects such as coverage requirements, outreach strategies, and the grievance redressal mechanism. Evaluate your understanding of the responsibilities and protocols involved in the implementation of this agricultural insurance scheme.

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