Maharashtra Ends Re 1 Crop Insurance Over Bogus Applicants
Why in the news
Maharashtra scrapped its Re 1 crop insurance scheme after finding widespread fraud and will revert to the Centre’s premium structure.
Key facts
- The scheme began in 2023 under the Mahayuti government; farmers paid only Re 1 and the government bore the remaining premium.
- Applications jumped sharply, along with bogus claims in 2024-25.
- 5.9 lakh bogus applicants were found in 2024-25; the state and Centre had paid ₹478.5 crore in premiums for them.
- Possible loss in a calamity: ₹6,000 crore payouts.
Farmer premium under the Centre’s model
| Crop type | Share of sum insured |
|---|---|
| Kharif | 1.5% |
| Rabi | 2% |
| Horticulture | 5% |
Significance
- An improved version of the state scheme has been proposed, with more transparency and accountability.
- The aim is that only genuine farmers get cover.
Exam angle
- Scrapped: Maharashtra’s Re 1 scheme (launched 2023).
- Premium slabs: 1.5% / 2% / 5%.