Pradhan Mantri Fasal Bima Yojana (PMFBY)

Pradhan Mantri Fasal Bima Yojana (PMFBY)

Prelims:

Agriculture

Mains:

GS Paper III: Agriculture

Current relevance:

The Pradhan Mantri Fasal Bima Yojana (PMFBY) has completed a decade as a major component of India’s agricultural risk-management framework. From Kharif 2016 to Rabi 2025-26, more than 92.46 crore farmer applications were insured, while over 26.33 crore applications received claims exceeding ₹2.06 lakh crore. The Union Budget 2026-27 allocated ₹12,200 crore for the scheme.

At a glance:

Framework & Coverage:

1.        Launched: 18 February 2016; operational from Kharif 2016.

2.      Objective: Provide affordable financial protection against crop losses and stabilise farmers' incomes against agricultural risks.

3.      Coverage extends across the crop cycle, including:

·         Prevented/failed sowing

·         Standing crop yield losses

·         Mid-season adversity

·         Localised calamities

·         Specified post-harvest losses

4.      Eligible farmers include loanee, non-loanee, tenant and sharecropper farmers, subject to prescribed conditions.

5.      Non-loanee farmers can voluntarily enrol under PMFBY.

6.      Around 50% of farmers, on average, enrolled voluntarily as non-loanee farmers during the last decade.

Major risks covered:

1.        Standing Crops: Drought, dry spells, floods, inundation, cyclones, hailstorms, lightning, pests and diseases.

2.      Prevented Sowing: Eligible farmers may receive claims up to 25% of the sum insured when adverse weather prevents sowing after expenditure has been incurred.

3.      Post-Harvest Loss: Crops in “cut-and-spread” condition are covered for up to 14 days after harvesting against specified cyclonic and unseasonal rainfall events.

4.      Localised Calamities: Includes specified losses from hailstorms, landslides, inundation, cloudbursts and natural fire.

5.      Losses due to war, nuclear risks, riots, theft and other preventable risks are excluded.

Maximum Farmer Premium:

1.        Kharif foodgrain & oilseeds: 2%

2.      Rabi foodgrain & oilseeds: 1.5%

3.      Commercial & horticultural crops: 5%

4.      Remaining premium subsidy is shared by the Centre and States in a 50:50 ratio.

5.      For North-Eastern and Himalayan States/UTs, the Centre-State subsidy contribution is 90:10.

Technology-driven Crop Insurance:

PMFBY integrates multiple digital initiatives:

1.        NCIP – National Crop Insurance Portal: Digital enrolment, subsidy administration, claim calculation and electronic claim transfers.

2.      DigiClaim: Introduced from Kharif 2022 for transparent calculation and settlement of claims through NCIP and PFMS.

3.      YES-TECH: Uses remote sensing and technology-based methods for crop-yield estimation.

4.      WINDS: Uses Automatic Weather Stations and Automatic Rain Gauges to generate hyperlocal weather data at Block and Gram Panchayat levels.

5.      CROPIC: Uses geo-tagged crop photographs to monitor crop health and support damage and yield assessment.

6.      CCE-Agri App: Digitally captures Crop Cutting Experiment yield data.

7.      Krishi Rakshak Portal & Helpline: Provides the toll-free number 14447 for crop-insurance grievances.

8.      CLAP: Digitally records individual farm-level crop losses arising from localised calamities.

Restructured Weather-Based Crop Insurance Scheme (RWBCIS):

1.        RWBCIS complements PMFBY by addressing risks specifically arising from adverse weather.

2.      It is a weather index-based insurance scheme.

3.      Claims are based on specified weather parameters as proxies for crop damage, rather than actual assessed crop-yield losses.

4.      Operates through an Area Approach in defined Reference Unit Areas (RUAs).

5.      Trigger parameters include:

·         Deficit/excess rainfall

·         Dry spells

·         Extreme temperatures

·         Humidity

·         Wind speed

6.      It is particularly important for fruits, vegetables and plantation crops.

7.      RWBCIS follows the same affordable farmer premium rates of 1.5%–5%, depending on crop type.

Significance:

1.        Income Stabilisation: Protects farmers against financial shocks arising from crop failure.

2.      Climate Resilience: Provides protection against droughts, floods, cyclones and other climatic risks.

3.      Inclusive Insurance: Extends coverage to loanee, non-loanee, tenant and sharecropper farmers subject to eligibility requirements.

4.      Technology Integration: Digital tools strengthen accuracy, transparency and speed of insurance delivery.

5.      Food Security: Greater farm resilience supports the continuity of agricultural production and thereby strengthens national food security.

Way Forward:

1.        Technology-based Assessment: Deepen the use of remote sensing, geo-tagging, digital CCEs and hyperlocal weather data.

2.      Faster Claims: Strengthen NCIP, DigiClaim and PFMS-based settlement mechanisms for timely compensation.

3.      Inclusive Enrolment: Improve accessibility for non-loanee, tenant and sharecropper farmers.

4.      Data Integration: Expand integration of State e-land records with NCIP for accurate validation of insured land.

5.      Grievance Redressal: Strengthen farmer-facing mechanisms such as the Krishi Rakshak Portal and Helpline.

6.      Climate-smart Insurance: Continue integrating crop insurance with India's broader transition towards climate-resilient agriculture and agricultural risk management.

Source: PIB- https://www.pib.gov.in/PressReleaseDetail.aspx?PRID=2304549&reg=48&lang=1