Pradhan Mantri Fasal Bima Yojana Benefits & PMFBY Scheme Details

Pradhan Mantri Fasal Bima Yojana (PMFBY) is a path breaking scheme for farmers’ welfare. Here are Scheme Benefits and Details.


Pradhan Mantri Fasal Bima Yojana Benefits PMFBY Scheme Details

Pradhan Mantri Fasal Bima Yojana Benefits PMFBY Scheme Details – The Indian agricultural sector is dependent on vagaries of weather – particularly rain-fed areas which constitute more than 60% of the total sown areas. Large scale damage to crops for various reasons including weather is very common and the farming communities, whose sole livelihood depends on crops, bear the brunt of this. Due to the high element of risk involved in farming because of unfavorable weather, it becomes all the more important to protect the farmers from the losses that can occur due to large scale destruction of crops.

Crop insurance is purchased by agricultural producers, including farmers and others to protect themselves against either the loss of their crops due to natural disasters, such as hail, drought, and floods, or the loss of revenue due to declines in the prices of agricultural commodities. For this purpose, the Government of India introduced 4 crop insurance schemes in the country as follows:

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  • National Agricultural Insurance Scheme (NAIS).
  • Modified National Agricultural Insurance Scheme (MNAIS).
  • Weather Based Crop Insurance Scheme (WBCIS).
  • Coconut Palm Insurance Scheme (CPIS).

First scheme is being run only by the Agricultural Insurance Corporation and is most wide spread throughout the country (Nearly 450 districts).

Objectives – Pradhan Mantri Fasal Bima Yojana Benefits (PMFBY)

  • To provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crop as a result of natural calamities, pests & diseases.
  • To stabilize the income of farmers to ensure their continuance in farming.
  • To encourage farmers to adopt innovative and modern agricultural practices.
  • To ensure flow of credit to the agriculture sector.

Implementing Agency

The Scheme shall be implemented through a multi-agency framework by selected insurance companies under the overall guidance & control of the Department of Agriculture, Cooperation & Farmers Welfare (DAC&FW), Ministry of Agriculture & Farmers Welfare (MoA&FW), Government of India (GOI) and the concerned State in co-ordination with various other agencies; viz Financial Institutions like Commercial Banks, Co-operative Banks, Regional Rural Banks and their regulatory bodies, Government Departments viz. Agriculture, Co-operation, Horticulture, Statistics, Revenue, Information/Science & Technology, Panchayati Raj etc.

Pradhan Mantri Fasal Bima Yojana Benefits (PMFBY)

Premium Rates: The Actuarial Premium Rate (APR) would be charged under PMFBY by IA. DAC&FW/States will monitor the premium rates considering the basis of Loss Cost (LC) i.e. Claims as % of Sum Insured (SI) observed in case of the notified crop(s) in notified unit area of insurance (whatsoever may be the level of unit area) during the preceding 10 similar crop seasons (Kharif / Rabi) and loading for the expenses towards management including capital cost and insurer’s margin and taking into account non-parametric risks and reduction in insurance unit size etc.. The rate of Insurance Charges payable by the farmer will be as per the following table:







Maximum Insurance Charges payable by farmer (% of Sum Insured)



Food & Oilseeds crops (all cereals, millets, & oilseeds, pulses)

2.0% of SI or Actuarial rate,

whichever is less




Food & Oilseeds crops (all cereals, millets, & oilseeds,pulses)


1.5% of SI or Actuarial rate, whichever is less



Kharif &




Annual Commercial / Annual

Horticultural crops



5% of SI or Actuarial rate, whichever is less



The difference between premium rate and the rate of Insurance charges payable by farmers shall be treated as Rate of Normal Premium Subsidy, which shall be shared equally by the Center and State.

Salient Features of Pradhan Mantri Fasal Bima Yojana (PMFBY)

  • The farmers package policy is underwritten by the General Insurance Companies empanelled by DAC&FW under crop insurance programs and/or designated by this Department or through GIC Companies having tie-up with concerned F.I./Banks for non-crop sections of the policy.
  • The policy contains 7 Sections. Crop Insurance is mandatory. However, farmers have to choose at least two other sections also to avail the applicable subsidy under crop insurance section.
  • In case of crop insurance, applicable Farmer’s share of premium ranging between 1.5% to 5% based on their insured crops is payable by farmer & in case Actuarial premium is more, the Government will provide subsidy equivalent to the difference between Actuarial premium and premium paid by farmer. The crop insurance is based on area approach whereas all other sections are on individual basis.
  • If the farmers already availed any insurance policy of similar nature and sum insured not less than as mentioned in the policy than they would be exempted from taking such section(s). However details of such policy would be provided in their proposal form.
  • The rates above are indicative & subject to the concurrence of the insurers.
  • Sum Insured and premium rates are provisionally taken and may change according to the risk(s).

Pradhan Mantri Fasal Bima Yojana’s Detailed Information (PMSBY) | Contact

Other Related Articles

Pradhan Mantri Fasal Bima Yojana Documents Required for Claim & Application Procedure | Pradhan Mantri Fasal Bima Yojana Eligibility Criteria


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