Pradhan Mantri Fasal Bima Yojana (PMFBY) All Details.

Pradhan Mantri Fasal Bima Yojana (PMFBY)

Insurance companies made nearly Rs 40,000 crore under the Centre’s flagship crop insurance scheme since its inception in 2016-17. This was revealed by the data shared by the Union Minister of Agriculture & Farmers Welfare on the Pradhan Mantri Fasal Bima Yojana (PMFBY).

About Pradhan Mantri Fasal Bima Yojana (PMFBY)

A scheme of the Ministry of Agriculture & Farmers Welfare, PMFBY is an insurance service for farmers for their yields, launched in 2016.

The new crop insurance Scheme is in line with the One Nation One Scheme theme.

The PMFBY replaced the previous two schemes: the National Agriculture Insurance Scheme (NAIS) and the modified NAIS.

It has incorporated the best features of all previous schemes while elimination all previous shortcomings.


 To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crops as a result of natural calamities, pests and diseases.

To stabilize the income of farmers to ensure their continuance in farming.

To encourage farmers to adopt innovative and modern agricultural practices.

To ensure flow of credit to the agriculture sector.

Salient features

There will be a uniform premium of only 2% tube paid by farmers for all kharif crops and 1.5% for all Rabi crops (winter sown).

In case of annual commercial and horticultural crops, the premium to be paid by farmers will be only 5%.

The premium rates to be paid by farmers are very low and balance premium will be paid by the Government (to be shared equally by central and state governments). The idea is to provide a fully insured amount to the farmers against crop loss on account of natural calamities.

The Scheme will be implemented on an ‘Area Approach basis,’ i.e., Defined areas for each notified crop for widespread calamities,

There is no upper limit on Government subsidy. This means, even if the balance premium is 90%, it will be borne by Government.

The use of technology will be encouraged to a great extent. For cutting to reduce the delays in claim payment to farmers. Remote sensing will be used to reduce the number of crops cutting experiments.

There will be exemption from service Tax liability of all the services involved in the implementation of the scheme.

Risks covered under the scheme

Comprehensive risk insurance is provided to cover yield losses due to non-preventable risk, such as Natural Fire and Lightning, Storm, Hailstorm, Cyclone, Typhoon, Tempest, Hurricane, Tornado. Risks due to Flood, Inundation and Landslide, Drought, Dry spells, Pests and Diseases will also be covered.

In case where the majority of insured farmers in a notified area have intent to sow or plant and have incurred expenditure for the purpose, but are prevented from sowing or planting the insured crop due to adverse weather conditions, indemnity claims up to a maximum of 25% of the sum-insured may be made.

In post-harvest losses, coverage will be available up to a maximum period of 14 days from harvesting for those crops which are kept in “cut & spread” condition to dry in the field.

Loss and damage resulting from occurrence of identified localized risks like hailstorm, landslide and Inundation affecting isolated farms in the notified area would also be covered.

Leave a Comment