Pradhan Mantri Fasal Bima Yojana (PMFBY) Crop Insurance Details & Benefits

Pradhan Mantri Fasal Bima Yojana (PMFBY) Crop Insurance Details & Benefits

Crop Insurance – Pradhan Mantri Fasal Bima Yojana



India has been an agriculture dominant economy and hence it is important to mitigate the risk faced by this sector. The present government has been working dedicatedly to reduce the risk and what can be better than insurance for the crops? In an announcement in 2016, the government of India launched new insurance schemes under Pradhan Mantri Fasal Bima Yojana. The main aim behind launching this scheme was to minimize the loss faced by the farmer because of spoilage of the crop. This would eventually help in saving the farmer from the debt trap.

The scheme was implemented with the help of multiple agencies and hence you would notice many leading insurance providers offering this insurance. Moving ahead, let’s look at the coverage under PMFBY

Coverage Offered

  • 1. All the Food Crops, Oilseeds, commercial and horticultural crops were considered under this scheme.
  • 2. The scheme aims to provide insurance to the farmer against sowing, planting and germination risk. This may even be because of low rainfall.
  • 3. There is also a comprehensive risk cover which is from sowing to harvesting stage. This includes any non-preventable risk like a flood, drought, pest attack, landslide, storm, lightning and other such sector.
  • 4. The insurance also covers for post-harvest loss which includes loss caused by unseasonal rail, cyclone, etc.
  • 5. Apart from the details listed above, the insurance provides coverage for localized calamities and the farmer can also purchase an add-on cover for covering the loss arising due to wild animals.


What is the Main Objective of Fasal Bima Yojna?

P.M supporting sustainable production in agriculture sector by Pradhan Mantri Fasal Bima Yojana (PMFBY)

  • Providing financial support to farmers suffering crop loss/damage arising out of unforeseen events

  • Stabilizing the income of farmers to ensure their continuance in farming

  • Encouraging farmers to adopt innovative and modern agricultural practices

  • Ensuring flow of credit to the agriculture sector; which will contribute to food security, crop diversification and enhancing growth and competitiveness of agriculture sector besides protecting farmers from production risks.


 Eligibility Criteria

  • Compulsory Component All farmers availing Seasonal Agricultural Operations (SAO) loans from Financial Institutions (i.e. loanee farmers) for the notified crop(s) would be covered compulsorily.

  • Voluntary Component The Scheme would be optional for the non-loanee farmers.


 Coverage of Risks and Exclusions:

Following stages of the crop and risks leading to crop loss are covered under the scheme.

  • Prevented Sowing/ Planting Risk: Insured area is prevented from sowing/ planting due to deficit rainfall or adverse seasonal conditions

  • Standing Crop (Sowing to Harvesting): Comprehensive risk insurance is provided to cover yield losses due to non- preventable risks, viz. Drought, Dry spells, Flood, Inundation, Pests and Diseases, Landslides, Natural Fire and Lightening, Storm, Hailstorm, Cyclone, Typhoon, Tempest, Hurricane and Tornado.

  • Post-Harvest Losses: coverage is available only up to a maximum period of two weeks from harvesting for those crops which are allowed to dry in cut and spread condition in the field after harvesting against specific perils of cyclone and cyclonic rains and unseasonal rains.

  • Localized Calamities: Due to Loss/ damage resulting from occurrence of identified localized risks of hailstorm, landslide, and Inundation affecting isolated farms in the notified area.

General Exclusions: Losses arising out of war and nuclear risks, malicious damage and other preventable risks shall be excluded.

Premium and Other Details

The main aim to launch this scheme was to ensure that the scheme remains to be affordable. To ensure the affordability, the premium was kept low. For all the Kharif crops, the premium is 2% of SI or actual rate. The lower amount would be the premium. For all Rabi crops, the premium is 1.5% of SI or actual rate. Lastly, the premium for annual commercial or horticultural crops is 5%.


Until now, several people have availed the benefit of the scheme. The best feature of having Fasal Bima is that the settlement is very quick. The paperwork required is very minimal and that helps people in looking forward to purchasing the insurance. If you are also interested in purchasing insurance for the crops then you can head out to any major insurance service provider like ICICI-Lombard, HDFC-ERGO, Agriculture Insurance Company, IFFCO-Tokio, SBI General Insurance Company, Tata-AIG any many others.

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