The Pradhan Mantri Fasal Bima Yojana (PMFBY) is a government-sponsored crop insurance scheme in India, aimed at providing financial support to farmers in the event of crop failure or damage due to natural calamities, pests, or diseases. Launched in January 2016, it has been instrumental in safeguarding the livelihoods of millions of farmers across the country. In this article, we will delve into the key features and benefits of the scheme, along with recent updates for the year 2020.
The primary objective of the Pradhan Mantri Fasal Bima Yojana is to alleviate the financial burden on farmers by encouraging them to adopt modern farming techniques and ensure financial stability in times of distress. This crop insurance scheme covers a wide range of crops, including kharif, rabi, and horticultural crops, providing comprehensive protection to farmers against various uncertainties.
Under the PMFBY, farmers are required to pay a nominal premium, typically 1.5-2% of the sum insured for kharif crops, 2-2.5% for rabi crops, and 5% for commercial and horticultural crops. The remaining premium is shared equally between the Government of India and the state governments. Small and marginal farmers, who constitute a large section of the Indian farming community, benefit from lower premium rates due to government subsidies.
The scheme ensures seamless claim settlement by implementing a simplified procedure. In case of crop loss or damage, farmers are required to intimate the concerned insurance company within 72 hours or at the earliest opportunity. The assessment of crop loss is conducted by specialized agencies, known as the “Loss Assessment Units,” to provide a fair assessment. Claims are settled within a specific time frame, resulting in prompt compensation and faster recovery for farmers.
To further enhance the efficacy of the scheme and streamline the insurance process, the government introduced some crucial changes starting from the year 2020. One significant change is the inclusion of new add-on covers such as localized calamities (e.g., hailstorms), post-harvest losses, and prevented sowing due to adverse weather conditions. This ensures a more comprehensive coverage for farmers, enabling them to mitigate risks associated with unforeseen circumstances.
Another significant change is the incorporation of technology in the insurance process. The government is actively promoting the adoption of modern tools like smartphones and drones to capture and archive the requisite data for insurance claims. This technological intervention aims to facilitate a faster assessment and settlement process, reducing the administrative burden for farmers.
Moreover, considering the diversified cropping patterns across the country, the PMFBY has adopted an “Area Approach” instead of the traditional “Individual Approach” to assess crop losses. This means that farmers in a specific geographic area are grouped together, and the claim payout is based on the average loss of the whole area. This approach mitigates the issue of potential discrepancies arising from individual assessments, making the claim settlement process more transparent and equitable.
The Pradhan Mantri Fasal Bima Yojana has emerged as a game-changer in the Indian agricultural landscape, offering a safety net to farmers against unpredictable events. Its provisions have evolved over time to cater to the unique challenges faced by the farming community. By providing affordable insurance and incorporating advancements in technology and assessment methods, the PMFBY contributes significantly to the welfare and economic empowerment of Indian farmers.