PMFBY: Pradhan Mantri Fasal Bima Yojana
PMFBY: Launched on 18 February 2016, PMFBY is a modified crop insurance scheme that replaced the existing National Agricultural Insurance Scheme (NAIS), weather-based crop insurance scheme, and Modified National Agricultural Insurance Scheme(MNAIS).
It is a comprehensive insurance cover against the failure of crops thus stabilizing the income of the farmers. It is an important step taken by GoI to achieve the target of doubling the farmer’s income by 2022.
Objectives of PMFBY-
a. To provide insurance coverage and financial support to the farmers in the event of any of the notified crops as a result of natural calamity, pests, and diseases.
b. To stabilize the income of farmers to ensure their continuance in farming.
c. To encourage farmers to adopt innovative and modern agricultural practices.
d. To ensure the flow of credit to the agricultural sector.
About the Scheme-
a. There will be a uniform premium for Rabi, Kharif, and horticultural/ commercial crops at 2%, 1.5%, and 5% respectively
b. The balance premium will be paid by GoI to ensure the full insured amount to farmers against the crop loss; even if it is 90%. There is no capping on the balance premium.
c. The amount will be equally shared by the Centre and the states.
d. Remote Sensing and Smartphones will be used to gather data to reduce the time taken in claims payment.
Who will be covered under PMFBY?
The eligible farmers are those who are growing notified crops in the notified area.
There will be compulsory coverage of the farmers who possess a Crop Loan Account/ Kisan Credit Card (KCC) i.e. the loanee farmer or the farmers whom the Government may decide to include from time to time.
All the farmers who are not covered including the farmers having Krop KCC/ Crop Loan Account whose credit limit is not renewed will have voluntary coverage.
What kind of risks will be covered under PMFBY?
Yield Losses- Yield risks due to non-preventable risks like natural fire, lightning, storm, hail-storm, cyclone, typhoon, tempest, hurricane, tornado, and also risks from flood, inundation and landslides, droughts, dry spells, pests, and diseases.
Post Harvest Losses– The crops which are cut and spread in the field will have coverage for a maximum of 14 days from the day of harvesting.
Isolated farms in notified areas will have coverage for the occurrence of identified localized risks like hail storms, landslides, etc.
A maximum sum of up to 25% of the sum insured will be available as indemnity claims to prevent farmers from sowing/ planting due to bad weather conditions, for which expenditure has already been incurred.
What happens if there is a delay in the settlement of claims?
The provision of penalty/ incentive has been added in the operational guidelines, implemented from October 1, 2018.
Insurance companies will have to pay a 12% interest rate to farmers for the delay in settlement claims beyond 2 months of the prescribed cut-off date.
The state government has to pay 12% interest rate for the delay in the release of the state share of subsidy beyond three months of prescribed cut-off date/ submission of requisition by insurance companies.
Other provisions-
Insurance companies will have to spend 0.5% of their earnings from annual premiums on the advertisement of the scheme. Certain horticultural crops have been brought under PMFBY on an experimental basis.
Read Important Topics for General Studies
Please leave your valuable feedback/suggestions. Share this article with your friends and other aspirants.
Follow us on FACEBOOK
