Fasal Bima Yojana (FBY), officially known as the Pradhan Mantri Fasal Bima Yojana (PMFBY), is a crop insurance scheme launched by the Government of India in 2016 to provide financial support to farmers in case of crop damage due to natural calamities, pests, or diseases.
Table of Contents
Introduction to Fasal Bima Yojana
Agriculture is the backbone of India’s economy, supporting nearly 58% of the rural population. However, farmers face constant risks from unpredictable weather, pests, and diseases, leading to crop failures and financial distress. To address these challenges, the Government of India launched the Pradhan Mantri Fasal Bima Yojana (PMFBY) in 2016.
This section covers:
✔ What is PMFBY?
✔ Key objectives of the scheme
✔ Why crop insurance is crucial for Indian farmers
What is Pradhan Mantri Fasal Bima Yojana (PMFBY)?
Pradhan Mantri Fasal Bima Yojana (PMFBY) is a government-sponsored crop insurance scheme that provides financial protection to farmers against crop losses caused by:
- Natural calamities (droughts, floods, cyclones)
- Pests & diseases
- Fire & lightning
Key Features:
- Low Premiums: Farmers pay just 1.5–5% of the sum insured, with the rest subsidized by the government.
- Wide Coverage: Includes food crops, oilseeds, and horticultural crops.
- Tech-Driven Claims: Uses satellite imagery, drones, and AI for quick damage assessment.
- Direct Benefit Transfer (DBT): Compensation is directly credited to farmers’ bank accounts.
Example: A farmer growing rice pays 2% premium (₹800 for ₹40,000 sum insured). If floods destroy the crop, they receive up to ₹40,000 as compensation.
Objectives of PMFBY : PMFBY was launched with five core objectives:
- Financial Security: Ensure farmers don’t face bankruptcy due to crop failures.
- Stabilize Farm Income: Provide assured compensation to encourage risk-taking in agriculture.
- Encourage Modern Farming: Promote the adoption of high-yielding seeds and tech-based practices.
- Credit Flow Assurance: Help loanee farmers secure loans by reducing banks’ risk.
- Disaster Resilience: Mitigate the impact of climate change on agriculture.
Did You Know? As of 2024, PMFBY has covered over 36 crore farmer applications since its launch.
Importance of Crop Insurance in India : India’s agriculture is highly dependent on monsoons, with >50% of farmland being rain-fed. Crop insurance is vital because:
| Risk Factor | Impact Without Insurance | PMFBY’s Role |
|---|---|---|
| Droughts/Floods | Total crop loss → Debt trap | Full compensation |
| Pest Attacks | Reduced yield → Low income | Covers yield loss |
| Price Fluctuations | Low market prices → Losses | (Not covered under PMFBY) |
Why Farmers Need PMFBY:
- Small & Marginal Farmers (85% of total farmers) cannot afford private insurance.
- Prevents distress sales and suicides due to crop failures.
- Aligns with Sustainable Development Goals (SDG 1: No Poverty).
Case Study: In 2022 Maharashtra drought, PMFBY compensated 12 lakh farmers with ₹2,200 crore in claims.
Historical Background of Fasal Bima Yojana
The Pradhan Mantri Fasal Bima Yojana (PMFBY) is India’s flagship crop insurance scheme, launched in 2016 to provide financial protection to farmers against crop losses due to natural calamities, pests, and diseases. It replaced earlier schemes like the National Agricultural Insurance Scheme (NAIS) and the Modified NAIS (MNAIS), aiming for broader coverage, lower premiums, and faster claim settlements.
Previous Crop Insurance Schemes in India:
Before PMFBY, India had several crop insurance schemes:
Comprehensive Crop Insurance Scheme (CCIS) (1985-1999)
- Covered only loanee farmers.
- Low premium rates but limited scope.
National Agricultural Insurance Scheme (NAIS) (1999-2016)
- Covered both loanee and non-loanee farmers.
- High premium rates (up to 3.5% for Kharif, 2% for Rabi).
- Delayed claim settlements.
Modified NAIS (MNAIS) (2010-2016, Pilot Basis)
- Lower premium (up to 3% for Kharif, 1.5% for Rabi).
- Introduced localized risk assessment (e.g., hailstorms, landslides).
- Still faced implementation challenges.
Weather-Based Crop Insurance Scheme (WBCIS) (2007)
- Used weather parameters (rainfall, temperature) to assess claims.
- Limited to specific regions and crops.
These schemes had issues like low farmer participation, delayed payouts, and high premium burdens, leading to the need for a more efficient system like PMFBY.
Why Was PMFBY Launched in 2016?
PMFBY was introduced to address key shortcomings of previous schemes:
- Affordability – Farmers pay only 2% premium (Kharif), 1.5% (Rabi), and 5% (commercial/horticultural crops); the rest is subsidized by the government.
- Comprehensive Coverage – Includes yield losses, post-harvest damage, and localized risks (e.g., floods, cyclones).
- Technology Integration – Uses remote sensing, drones, and smartphones for quicker yield assessments.
- Mandatory for Loanee Farmers – Ensures wider coverage.
- Faster Claims – Targets settlement within 2 months of harvest.
The scheme aimed to increase farmer participation, reduce premium burden, and improve risk management in agriculture.
Key Changes Over the Years (2016-2025): Since its launch, PMFBY has undergone several modifications:
2016-2018: Initial Implementation
- Focus on increasing enrollment (both loanee & non-loanee farmers).
- Introduction of Aadhaar linkage for transparency.
2018-2020: Voluntary Participation & State Opt-Outs
- 2018: Scheme made voluntary for all farmers (previously mandatory for loanee farmers).
- Some states (e.g., Punjab, Bihar) opted out due to financial constraints.
2020: Restructured PMFBY (Revamped Version)
- Lower Central Share for Premium Subsidy – States had to contribute more.
- Encouraged Private Insurers – To improve efficiency.
- Use of AI & Remote Sensing – For accurate yield estimation.
2021-2025: Digital & Climate-Focused Reforms
- Meri Policy, Mere Haath Initiative (2021) – SMS-based policy distribution.
- Satellite-Based Crop Mapping – Reduced disputes in yield assessment.
- Inclusion of More Perils – Like wildfires and cloudbursts.
- Focus on Climate-Resilient Farming – Encouraged insurance for drought-resistant crops.
Challenges & Criticisms
- Delayed Claims – Some farmers still face payout delays.
- Low Awareness – Small farmers often unaware of enrollment processes.
- State Opt-Outs – Affected scheme uniformity.
Despite challenges, PMFBY remains a critical safety net for Indian farmers, with continuous improvements to enhance coverage and efficiency.
Key Features of Pradhan Mantri Fasal Bima Yojana
The Pradhan Mantri Fasal Bima Yojana (PMFBY) is a crop insurance scheme launched by the Government of India in 2016 to provide financial support to farmers in case of crop failure due to natural calamities, pests, or diseases. The scheme aims to stabilize farmers’ income and encourage continued agricultural activities. Below are the key features of PMFBY, categorized under different subheadings.
Coverage of Crops Under PMFBY : PMFBY covers a wide range of crops, ensuring protection for farmers across different agricultural sectors:
- Food Crops –
- Cereals (e.g., Wheat, Rice, Maize, Bajra)
- Pulses (e.g., Gram, Lentil, Peas)
- Oilseeds (e.g., Mustard, Groundnut, Soybean)
- Commercial/Horticultural Crops –
- Fruits (e.g., Mango, Banana, Apple)
- Vegetables (e.g., Tomato, Onion, Potato)
- Spices & Plantation Crops (e.g., Sugarcane, Cotton, Turmeric)
- Annual & Perennial Crops –
- Some states also include crops like bamboo and cashew under localized risks.
Exclusions:
- Crops grown for experimental purposes.
- Crops grown in forest areas without proper documentation.
Risks Covered Under the Scheme : PMFBY provides comprehensive coverage against various agricultural risks:
1. Natural Calamities (Yield Losses)
- Drought & Dry Spells – Insufficient rainfall leading to crop failure.
- Floods & Inundation – Excessive water damaging standing crops.
- Cyclones & Storms – High-speed winds destroying crops.
- Hailstorms & Landslides – Physical damage to crops.
- Unseasonal Rainfall – Adverse weather during harvest time.
2. Pest & Disease Attacks
- Losses due to locust attacks, fungal infections, or viral diseases.
3. Post-Harvest Losses (Additional Coverage)
- Coverage for up to 14 days after harvest for losses due to cyclones, unseasonal rains, or hailstorms during drying/cutting.
4. Prevented Sowing/Planting Risk
- If farmers are unable to sow due to adverse weather (e.g., delayed monsoon), they are still eligible for compensation.
Premium Structure & Government Subsidies : PMFBY follows a low-premium, high-coverage model to make insurance affordable for farmers:
| Category of Farmers | Premium Rate | Government Subsidy |
|---|---|---|
| Kharif Season Crops | 2% of sum insured | 98% subsidized |
| Rabi Season Crops | 1.5% of sum insured | 98.5% subsidized |
| Commercial/Horticultural Crops | 5% of sum insured | 95% subsidized |
| Small & Marginal Farmers | Same as above, with additional state support if applicable |
Key Points:
- The remaining premium (after farmer’s share) is paid by the Central & State Governments (50:50 split).
- There is no upper limit on government subsidy, ensuring full coverage.
Sum Insured & Claim Settlement Process:
1. Sum Insured :
- The insurance amount is based on the cost of cultivation or market price of the crop.
- It covers input costs (seeds, fertilizers, labor) and expected income.
2. Claim Settlement Process:
- Step 1: Crop Cutting Experiments (CCEs) –
- Government agencies conduct field surveys to assess crop damage.
- Step 2: Yield Data Comparison –
- Actual yield is compared with the threshold yield (average of past 7 years).
- Step 3: Loss Calculation –
- If yield is below threshold, claims are processed.
- Step 4: Payout –
- Compensation is directly transferred to farmers’ bank accounts via Direct Benefit Transfer (DBT).
- Claims must be settled within 2 months of harvest.
3. Use of Technology:
- Drones, Remote Sensing, & Satellite Imagery are used for quick damage assessment.
- Mobile Apps & Online Portals help farmers track claims.
How to Apply for Fasal Bima Yojana?
The Pradhan Mantri Fasal Bima Yojana (PMFBY) is a government crop insurance scheme that protects farmers against financial losses due to natural calamities, pests, and diseases. Farmers pay a minimal premium, and the rest is subsidized by the government.
This guide explains step-by-step online and offline registration processes, required documents, premium rates, and claim settlement procedures.
Eligibility for PMFBY:
- All farmers, including landowners, tenant farmers, and sharecroppers, can enroll.
- Crops Covered: Food crops (rice, wheat, maize), oilseeds, and commercial/horticultural crops.
- Seasonal Coverage: Kharif, Rabi, and annual horticultural crops.
How to Apply for PMFBY?
1. Online Registration Process
Farmers can apply online through the PMFBY portal or State Agriculture Department portals.
Steps for Online Application:
Visit the Official PMFBY Website
- Go to https://pmfby.gov.in.
Click on “Farmer Corner” → “Apply Now”
- New farmers must register; existing farmers can log in.
Enter Personal & Land Details
- Name, Aadhaar number, mobile number, bank details.
- Land details (survey number, area, location).
Select Crop & Insurance Details
- Choose crop name, season (Kharif/Rabi), and sum insured.
Upload Required Documents
- Aadhaar, land records, bank passbook, etc. (see full list below).
Pay Premium (If Applicable)
- Premium rates: 2% (Kharif), 1.5% (Rabi), 5% (Commercial crops).
Submit & Get Acknowledgement
- A confirmation SMS/email will be sent with application details.
Alternative Online Methods:
- State Agriculture Portals (e.g., UP, Maharashtra, Karnataka).
- Bank Websites (if enrolled via bank).
2. Offline Application Process
Farmers can apply through banks, Common Service Centers (CSCs), or agriculture offices.
A. Applying Through Banks
- Visit Your Nearest Bank (Cooperative/Rural Bank).
- Fill the PMFBY Application Form (available for free).
- Submit Documents (Aadhaar, land records, bank details).
- Pay Premium (if required).
- Get Receipt & Confirmation SMS.
B. Applying Through Common Service Centers (CSCs)
- Locate Nearest CSC (Find CSC here).
- Provide Aadhaar & Land Details.
- CSC Agent Will Fill & Submit Form Online.
- Pay Premium & Receive Acknowledgement.
Documents Required for PMFBY Enrollment:
| Document | Purpose |
|---|---|
| Aadhaar Card | Identity & Bank Linking |
| Land Records (7/12, Khatauni, etc.) | Proof of Cultivation |
| Bank Account Details (IFSC, Acc. No.) | Claim Settlement |
| Passport-size Photo (if required) | Application Form |
| Sowing Declaration (if applicable) | Crop Verification |
| Mobile Number (Linked to Aadhaar) | OTP Verification |
PMFBY Premium Rates:
| Crop Type | Premium Rate |
|---|---|
| Kharif Crops | 2% of Sum Insured |
| Rabi Crops | 1.5% of Sum Insured |
| Horticulture/Commercial Crops | 5% of Sum Insured |
| Rest is subsidized by the government |
Claim Process & Compensation:
- Crop Loss Assessment: Done by govt. agencies via satellite, drones, or field surveys.
- Compensation: Directly credited to the farmer’s bank account within 2 months of harvest.
- Grievance Redressal: Complaints can be filed at https://pmfby.gov.in/grievance.
Key Benefits of PMFBY:
✅ Low Premium (1.5% – 5%)
✅ Covers Natural Disasters (Drought, Floods, Cyclones)
✅ No Middlemen – Direct Bank Transfer
✅ Covers Post-Harvest Losses (for 2 weeks after harvest)
Helpline & Support:
- PMFBY Toll-Free Number: 1800-180-1551
- Email: [email protected]
- State Agriculture Departments (Check local contacts).
Final Tips:
✔ Apply before the cut-off date (varies by state & season).
✔ Keep Aadhaar-linked mobile number active for updates.
✔ Verify land records before applying.
By enrolling in PMFBY, farmers can secure their crops against unforeseen losses. Would you like help finding the nearest CSC or bank for registration?
Comparison with Other Crop Insurance Schemes
| Parameter | PMFBY | RWBCIS |
|---|---|---|
| Basis of Claim | Yield loss (actual crop cutting experiments) | Weather triggers (e.g., rainfall, temperature, humidity). |
| Coverage | All farmers (voluntary for non-loanee farmers). | Primarily for areas where yield data is unreliable. |
| Risk Covered | Comprehensive (yield loss, post-harvest losses, localized calamities). | Only weather-related risks (no yield assessment). |
| Premium Subsidy | 2% (Kharif), 1.5% (Rabi), 5% (horticulture) for farmers; balance by govt. | Similar subsidy structure as PMFBY. |
| Payout Speed | Slower (depends on yield data collection). | Faster (automatic payouts based on weather indices). |
| Best For | Regions with reliable yield data. | Areas with high weather variability or poor yield records. |
Key Difference: PMFBY focuses on actual yield loss, while RWBCIS compensates based on predefined weather triggers, making RWBCIS faster but less precise for individual farm losses.
PMFBY vs. Previous NAIS & MNAIS Schemes:
| Parameter | PMFBY (2016–Present) | NAIS (1999–2016) | MNAIS (Modified NAIS, 2010–2016) |
|---|---|---|---|
| Premium Rates | Lower for farmers (2% Kharif, 1.5% Rabi). | Higher (3.5–8% for loanee farmers). | Capped at higher rates than PMFBY. |
| Coverage | All farmers (voluntary for non-loanee). | Compulsory for loanee farmers only. | Improved but limited scope. |
| Risk Coverage | Wider (post-harvest losses, localized calamities). | Limited (mainly yield loss). | Added prevented sowing & post-harvest risks. |
| Claims Process | Faster (tech-driven, satellite/yield data). | Slow (manual CCEs). | Slightly improved but bureaucratic. |
| Government Share | Higher subsidy (shared Centre + State). | Lower subsidy burden. | Similar to NAIS but with better caps. |
| Unit of Insurance | Village/Area-based. | Individual claims in some cases. | Smaller area units than NAIS. |
For detailed guidelines, refer to the official PMFBY portal (pmfby.gov.in).
Frequently Asked Questions (FAQs) on Fasal Bima Yojana
Is PMFBY Mandatory for All Farmers?
No, Pradhan Mantri Fasal Bima Yojana (PMFBY) is not mandatory for all farmers, but it has certain compulsory and voluntary provisions based on farmer categories
What Happens if a Farmer Misses the Enrollment Deadline?
If a farmer misses the PMFBY enrollment deadline, loanee farmers risk losing insurance coverage (unless banks auto-enroll them), while non-loanee farmers must wait for the next season—no late applications are allowed. Always check deadlines via pmfby.gov.in or local authorities to avoid gaps in coverage.
How is Crop Damage Assessed Under PMFBY?
Crop damage under PMFBY is assessed through Crop Cutting Experiments (CCEs) and remote sensing (satellite/drone imagery) to compare actual yield with guaranteed thresholds, with claims paid for shortfalls. For localized disasters, on-the-spot surveys determine payouts, while weather-based claims use automated station data.
Conclusion – The Future of Fasal Bima Yojana
Government’s Vision for PMFBY:
The Pradhan Mantri Fasal Bima Yojana (PMFBY) was launched with the aim of providing financial security to farmers against crop losses due to natural calamities, pests, and diseases. The government envisions PMFBY as a key tool for risk mitigation in agriculture, ensuring stability in farmers’ incomes and encouraging sustainable farming practices.
Future goals include:
- Enhanced Technology Integration: Using drones, satellite imagery, and AI for accurate crop assessment and faster claim settlements.
- Increased Farmer Awareness: Expanding outreach programs to educate farmers about policy benefits and enrollment processes.
- Streamlined Claim Process: Reducing delays in compensation by improving transparency and efficiency in damage assessment.
- Broader Coverage: Including more crops, regions, and non-loanee farmers to maximize inclusivity.
Suggestions for Improving the Scheme:
To make PMFBY more effective, the following measures could be considered:
- Lower Premium Burden: Subsidize premiums further for small and marginal farmers to improve affordability.
- Timely Payouts: Ensure claims are settled within the stipulated time frame to build trust among farmers.
- Better Grievance Redressal: Strengthen dispute resolution mechanisms for transparency and accountability.
- Climate-Resilient Farming Incentives: Promote crop diversification and sustainable practices to reduce risks.
- Private Sector Participation: Encourage more insurance companies to join while ensuring fair competition.
- Real-Time Data Monitoring: Leverage IoT and remote sensing for precise yield estimation and fraud prevention.
By addressing these challenges, PMFBY can evolve into a more farmer-centric scheme, fulfilling its mission of safeguarding India’s agricultural community against uncertainties.