PMFBY is India's crop insurance scheme that aims to provide financial support to farmers and stabilize incomes. It was launched in 2016 to replace previous schemes. Key features include lower premiums paid by farmers, coverage of prevented sowing, post-harvest losses, and use of technology in claims settlement. Implementation is through state governments and public/private insurance companies. While PMFBY aims to benefit farmers, limitations include poor awareness, issues with premium deductions, and gaps in loss assessment. Strengthening implementation at state and local levels could help more farmers gain from the scheme.

1. Amit dhankar and Bhanuprakash N
2017A27M and 2017A12M
dhankhara656@gmail.com
Department of Agronomy
CCS Haryana Agricultural University, Hisar

2. Agriculture as a profession is full of
risk• Flood & Drought conditions
• Erratic monsoon
• Climate change
• Pest and Disease epidemic
• Hence Crop insurance mandatory
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PROSPECTS

3. • Launched at Sehore,
Madhya Pradesh on Feb.
18,2016
• 23 States
• Except Punjab, Mizoram,
Manipur, Nagaland and
Arunachal Pradesh
• Replaced NAIS (1999) and
MNAIS(2010)
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4. Objectives: ISAF
• Insurance coverage and financial
support
• Stabilizing the income
• Adoption of innovative and
modern agricultural practices.
• Flow of credit to agriculture
sector.
Insurance Stabilized Income Adoption Flow of credit 4

5. Highlights
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6. • Cover all the Notified Crops
• Implemented by the 5 Public and 13 Private
Insurance Companies
• Selection of Implementing Agencies done by the
State Govt. through Open Bidding procedure.
• State Level Co-ordination Committee on Crop
Insurance (SLCCCI), Sub committee to SLCCCI and
DLMC are responsible for Proper management of
Scheme
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Highlights…

7. COMPARISON WITH PREVIOUS SCHEME
S.NO
.
FEATURES NAIS
(1999)
MNAIS
(2010)
PM CROP INSURANCE
SCHEME
1 Premium rate Low High Lower than even
NAIS(govt. to contribute
five times that of farmer)
2 One Season –One
Premium
Yes No Yes
3 Insurance Amount cover Full Capped Full
4 On Account Payment No Yes Yes
5 Post-Harvest Losses
coverage
No Only in Coastal
areas
All India – for cyclonic +
Unseasonal rain
6 Prevented Sowing
coverage
No Yes Yes
7 Use of Technology ( for
quicker settlement of
claims)
No Intended Mandatory
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8. Area insured under PMFBY- Kharif 2017
S.NO
.
STATE AREA
INSURED
(‘000 ha)
Farmers
insured No.
(‘ooo)
Farmers Beneffitted
No. (‘ooo)
1 Madhya Pradesh 6520 3584.6 1637
2 Rajasthan 6095 5339 1976
3 Uttar Pradesh 2355 2498 393
4 Karnataka 1825 1581 425
5 Bihar 1068 1159 75
6 All India 34147 34652 12146
10Source- Ministry of Agriculture and Farmers Welfare

9. Farmers insured under PMFBY in Haryana
S.NO. Season No. of Loanee
Farmers
No. of Non-
Loanee Farmers
Total
1 Kharif -2017 605943 3016 608959
2 Rabi- 2017-18 701321 1363 702684
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Source- pmfby.gov.in

10. No. of Beneficiaries in India
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• In 2016-17 , 5.72 cr. Farmers get insured
under this scheme
• In 2017-18 , 4.87 cr. Farmers were insured

11. INSURANCE PREMIUM RATES
S.NO
.
SEASON CROP PREMIUM RATES
1 Kharif Food and Oilseed crops (all
Cereals, Millets,Pulses)
2.0 % of SI or
Actuarial rate
2 Rabi Food and oilseed crops( all
Cereals, Millets,Pulses) and
oilseeds.
1.5 % of SI or
Actuarial rate
3 Kharif
and Rabi
Annual Commercial or
Horticultural crops
5.0 % of SI or
Actuarial rate
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12. BASIS OF INSURANCE
• Implemented on ‘Area Approach Basis’.
• The assessment for crop losses due to non
preventable natural risks is on area approach.
• For localised calamities and Post-Harvest
losses,IU will be taken as the affected insured
field of the individual farmer.
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13. FARMERS TO BE COVERED
(i) On Compulsory Basis: All the farmers availing
Seasonal Agricultural Operations loans from Financial
Institutions i.e. Loanee Farmers.
(ii) On Voluntary basis: All other farmers growing notifed
crops who opts for scheme.
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14. RISKS COVERED
• Following stages of Crop and Risk leading to crop
loss are covered under the scheme.
(a) Prevented Sowing/ Planting Risk: Insured area is
prevented from sowing/planting due to
Deficit Rainfall and seasonal conditions
(b) Standing Crops: On notified area basis losses due
to Non-preventable risks such as:
(i) Natural fire and lightning
(ii) Storm, Hailstorm, Cyclone, Typhoon,
Hurricane, Tornado etc.
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15. RISKS COVERED
(iii) Flood, Inundation and landslides
(iv) Drought and Dryspells
(v) Pest/Diseases etc.
(c) 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 special perils of cyclonic and
unseasonal rains.
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16. RISKS COVERED
(d) Localized Calamities: Loss/damage resulting from
occurrence of identified localized risks of
Hailstorm, landslides and inundation affected
isolation farms in the notified area.
GENERAL EXCLUSIONS : Losses arising out of War and
nuclear risks, malicious damage and other
prevented risks shall be avoided.
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17. INDEMNITY LEVEL AND THRESHOLD YIELD
• The Threshold Yield is the benchmark yield level at which
Insurance protection is given to all the insured farmer in an
insurance unit.
• Threshold Yield=
Sum of last 5 years yield X Indemnity Level
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Indemnity Level: PMFBY has three levels of
indemnity 70 , 80 and 90 per cent corresponding to high,
moderate and low-risk area for all notified crops by respective
state governments. This means that farmers are themselves to
bear the loss of 30 , 20 or 10 per cent respectively
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18. INSURANCE AMOUNT
• The sum insured fixed by the District Level
Technical Committee (DLTC)
• Value of Sum insured = Threshold yield x MSP of
Crop
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19. No. of CCEs Required
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20. IMPLEMENTING AGENCIES IN HARYANA
• Haryana is divided into 3 clusters as follows:
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CLUSTER-I CLUSTER-II CLUSTER-III
Panchkula Ambala Yamuna Nagar
Kurukshetra Karnal Panipat
Faridabad Sonipat Palwal
Kaithal Hisar Rohtak
Sirsa Jind Fatehabad
Bhiwani Mahendergarh Jhajjar
Rewari Gurugram Mewat & Dadri
CLUSTER-I Oriental General Insurance Company Ltd.
CLUSTER-II SBI General Insurance Company Ltd.
CLUSTER-III Universal Sompo General Insurance
company Ltd.

21. CLAIM PAYOUT
Yield losses at Notified Area level: Once the yield data
are received from the states and U.Ts govt., claims will
be proccessed, analysed and settled by the IA.
Short fall in yield
CLAIM PAYOUT = X
Sum insured Threshold yield
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22. LOSS ASSESSMENT PROCEDURE
• Time and Method of Reporting Loss Claim:
 Immediate intimation (within 72 hrs.)
• Whom to be Reported:
 Directly to Insurance Company
 Concerned Bank, Local Agriculture Department,
Govt./Distt. Officials.
 Through Centralised Dedicated Toll free no. for
Claim Intimation
• Required Documentry evidence:
 Duly filled claim form
 Local newspaper cuttings 24

23. LOSS ASSESSMENT PROCEDURE
• Appointment of Loss Assessor by IC:
 For Post-Harvest losses (within 48 hrs of
receipt of information)
 The report should be completed within next
10 days
• Claim Settlement:
 Payment to farmers to be completed in next
15 days from loss assessment report
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24. NEW PROVISIONS IN THE OPERATIONAL GUIDELINES OF PMFBY
• Provision of Penalties/ Incentives for States, ICs and
Banks @ 12% of interest rates for delay in settlement
claims beyond two months of prescribed cut off date
• Inclusion of hailstorms in post harvest losses and cloud
burst and natural fire in localized calamities
• Add on coverage for crop loss due to attack of wild
animals
• More time to intimate individual claims – 72 hours
(instead of 48 hours)
• Publicity and awareness- 0.5% of Gross premium per
company per season
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25. 1)States not including important
crops in the list of notified major
crops
2)Negligible coverage of sharecropper
and tenant farmers
3)Mixed cropping and crop
diversification discouraged
4) Less involvement of Panchayti Raj
institutions
5)Poor awareness
Limitations

26. 6) Wrong and double premium
deduction
8) Poor capacity of insurance
companies
9) Farmers not provided policy
documents: No direct linkage with
insurance companies
10) Loopholes in assessment of crop
loss
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Loop holes in Implementation

27. Conclusion
• PMFBY is farmers friendly and fair. However, at the state
level, its vision is diluted. At the district level, its
implementation is seriously compromised. PMFBY is a
classic case of poor implementation of a great scheme
• Large-scale mass awareness programme , Involvement of
PRI ,enrollment through Common service Centres at
village level, setting up their own insurance firm by the
states helps a lot in effectively implementing it and
benefitting the farmers.
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28. SYMBOL OF TRUST
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