Bajaj Allianz to pay claims of 3.5L farmers who lost crops

In a relief for over 3.5 lakh farmers from Osmanabad, the Bombay High Court recently directed Bajaj Allianz General Insurance Company Limited to compensate them after their soybean crops were lost due to heavy rainfall in the Kharif season of 2020.

A division bench of Justices RD Dhanuka and SG Mehare, in its May 6 direction, said, “If the said amount is not paid by the insurance company within six weeks, the state government is directed to pay for compensation of post-harvest loss… within a period of six weeks thereafter.”

The HC has also directed the insurance company to comply with the directions issued by the Maharashtra government by its letter dated March 5, 2021. The government had asked the insurance company and various authorities in the state to grant the claims of farmers on the basis of reports of losses prepared by competent authorities.

The HC passed the order in a batch of petitions filed by farmers challenging refusal of their insurance coverage. They had sought that Bajaj Allianz be directed to sanction and grant compensation, or else the state government. Their pleas contended that they had paid an insurance premium, and even the government had contributed part of the insurance premium on their behalf. Around 4,57,216 farmers were affected in eight talukas of Osmanabad.

The court was informed that the insurance company received over Rs 500 crore as premium under Pradhan Mantri Fasal Beema Yojana (PMFBY) from farmers, and had compensated 72,325 of them by paying an aggregate amount of Rs 87.87 crore.

However, it refused to pay claims of a large number of farmers, including the petitioners, on the ground that they had failed to intimate the insurance company within 72 hours from the date of alleged loss suffered by them. This disentitled them from such benefit under the said scheme. Rejecting that contention, the court said, “The insurance company has acted illegally and arbitrarily. It has already paid a large number of similarly situated agriculturists, without those agriculturists availing any alternate remedy pursuant to the directions issued by the state government or otherwise. The alternate remedy in this situation would not be an efficacious alternate remedy.”