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DATA STORY : Five Years of Pradhan Mantri Fasal Bima Yojana

  • Published
    7th Jan, 2022

What is Pradhan Mantri Fasal Bima Yojana?

  • It is a crop Insurance Scheme launched in 2016.
  • It is administered by the Ministry of Agriculture
  • It replaced previous insurance schemes National Agricultural Insurance Scheme (NAIS) as well as the Modified NAIS.


  • To provide insurance coverage and financial support to the farmers in the event of crop failure
  • 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.

Highlights of the scheme-

  • Premium under the scheme-
  • The premium paid by farmers- It is 2% for all Kharif crops, 1.5% for all Rabi crops and 5% for annual commercial and horticultural crops
  • Remaining premium- The balance premium is to be paid by the central and state government collectively.
  • Use of technology- Smart phones will be used to capture and upload data of crop cutting to reduce the delays in claim payment to farmers.
  • Farmers to be covered- All farmers growing notified crops in a notified area during the season who have insurable interest in the crop are eligible. As per revised provisions, the scheme is voluntary for all farmers.
  • Crops covered: The Scheme cover all the Crops for which past yield data is available and grown during the notified season, in a Notified Area and for which yield estimation at the Notified Area level will be available.
  • Risks covered under the scheme-
  • Yield Losses (standing crops, on notified area basis)- Risk insurance is provided to cover yield losses due to non-preventable risks, such as Natural Fire and Lightning, Storm, Hailstorm and cyclone etc.
  • Adverse weather conditions- In case where majority of the insured farmers of a notified area are prevented from sowing/planting the insured crop due to adverse weather conditions, shall be eligible for indemnity claims upto a certain limit.
  • Post-harvest loss- 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.
  • Localized problems- For certain localized problems, loss /damage resulting from occurrence of identified localized risks like hailstorm, and Inundation affecting isolated farms would also be covered.
  • Revised provisions of the scheme-
    • Greater flexibility- States/ UTs have been given more flexibility to implement the scheme.
    • Investing in ICE Activities: Insurance companies have to now spend 0.5% of the total premium collected on information, education and communication (IEC) activities.

Performance report-

  • According to the Union agriculture ministry
    • Claims worth Rs 90,000 crore have been disbursed to farmers in 5 years of scheme.
    • 29 crore number of farmers have insured their crops under this scheme.
    • Annually, around 5.5 crores number of farmers registered for the scheme.

Question- PM Fasal Bima Yojana is a necessary step to improve insurance penetration in the agriculture sector. Discuss the key features of the scheme and suggest measures to improve insurance penetration in India.

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