Pradhan Mantri Fasal Bima Yojana (PMFBY)

Introduction 

The Pradhan Mantri Fasal Bima Yojana (PMFBY) is a government-sponsored crop insurance scheme in India, launched on 18 February 2016 by the Government of India. It was introduced to secure farmers against unpredictable losses to their crops from natural calamities like droughts, floods, pests, and diseases. In plain terms, PMFBY gives farmers a safety net: if their crops fail or yield falls below a threshold due to non-avoidable risks, they can claim financial assistance.

Before PMFBY, farmers often faced full losses with no support when weather or pest attacks wiped out their produce. This scheme aims to stabilize farm incomes, reduce their financial distress, and encourage more investment in better inputs and technology. The policy need is straightforward: agriculture is inherently risky, and protecting farmers helps sustain food production and rural livelihoods.

PMFBY targets primarily farmers, including those organized in self-help groups (SHGs) or farmer producer organizations (FPOs) when eligible. Its benefits, eligibility criteria, and application procedures are made accessible to farmers across states in India so they can insure crops with minimal burden.

Overview of the Scheme

The Pradhan Mantri Fasal Bima Yojana (PMFBY) is administered by the Ministry of Agriculture & Farmers Welfare, Government of India (central), in partnership with state governments. The scheme began from Kharif 2016 as a central‐sector programme (i.e. central government leads) for all states/UTs choosing to participate.

In each state, the state agriculture/line department(s) coordinate implementation, working with empanelled insurance companies (including Agriculture Insurance Company of India and various private general insurers) selected via competitive bidding. Roles like enrollment, yield assessment, and claim settlement are shared between state officials and insurance firms.

Funding pattern & premium sharing

• For most states/UTs, the subsidy on premium (i.e. the portion not borne by farmers) is shared 50:50 between the central and state governments.
• For North Eastern States, from Kharif 2020 onwards, the sharing has been adjusted to 90:10 (central:state).
• There is provision for states to reimburse administrative, technology, or crop-cut experiment costs (e.g. 3 % of total budget allocated for infrastructure/technology) from their budgets.

Coverage / Components
PMFBY is focused on crop insurance and related risk coverage. It covers losses due to natural calamities (drought, flood, cyclones, unseasonal rain, hailstorms), pest and disease attacks, prevented sowing, post-harvest losses (under notified conditions), and localized risks (like landslide, hail) in the notified areas. It does not formally include machinery, input subsidies, training or value-addition under the scheme (those aspects belong to other agricultural programmes).

Current status

• The scheme is ongoing and has been revamped from Kharif 2020 with revised guidelines and enhanced technology use.
• The Union Cabinet has approved continuation of PMFBY and its linked Restructured Weather Based Crop Insurance Scheme (RWBCIS) till 2025-26 with a budget outlay of ₹ 69,515.71 crore for the 2021–26 period.
• Recently, technological innovations such as YES-TECH (remote sensing yield estimation) and WINDS (network of weather stations) are being introduced to improve transparency and speed of claim assessment.

Example (for clarity):
If in a notified area, heavy unseasonal flooding destroys paddy crops, insured farmers can file a claim. A combined yield assessment (state + insurer + remote sensing) is done. The insurance company pays full compensation. Farmers pay only a small premium (e.g. max 2 % of sum insured for Kharif), and the rest is borne equally (or 90:10) by central and state governments. 

Objectives 

The objectives of PMFBY focus on giving farmers protection, stabilizing farming, and supporting credit and innovation in agriculture. Below are its key goals in simple language:

• Provide insurance coverage and financial support to farmers when a notified crop fails due to natural calamities, pests, or diseases.
• Stabilise farmers’ income so that they can continue farming even after crop loss.
• Encourage farmers to adopt modern, improved, or innovative agricultural practices.
• Ensure a steady flow of agricultural credit by reducing the risk for lending institutions.
• Support sustainable agricultural production by covering risks across the crop cycle, from pre-sowing to post-harvest stages.
• Expand the reach of crop insurance so more farmers and more areas get protection over time.
• Promote fairness by having uniform premium rates or standardized rules in notified areas. 

Key Features 

The scheme offers several practical features and benefits that protect farmers through crop risks and make insurance manageable. Below are its main features:

• Comprehensive crop risk cover
  Covers losses at all stages – from pre-sowing to post-harvest – caused by natural calamities, pests, diseases, unseasonal rainfall, etc.
• Uniform low premium rates
  Farmers pay only 2 % of the sum insured for Kharif food & oilseed crops, 1.5 % for Rabi food & oilseeds, and 5 % for annual commercial/horticultural crops.
• Central–State subsidy on premium
  The difference between the actuarial premium and the farmer’s share is borne equally by the Centre and the State (or as per special sharing in some regions).
• Area-approach for claim settlement
  Losses from widespread risks are assessed over a notified area (e.g. village or panchayat) to decide payouts.
• Localized risks & post-harvest losses
  For perils like hailstorms, landslides, and post-harvest losses due to cyclonic rains or unseasonal rain, assessments are made at the individual farmer’s field.
• Prevented sowing/germination cover
  If sowing or planting is prevented due to adverse seasonal conditions, farmers may claim up to 25 % of the sum insured.
• Compulsory for loanee farmers, voluntary for others
  Farmers who take crop loans must enroll; non-loanee farmers may join the scheme voluntarily (if they have insurable interest).
• No cap on sum insured
  There is no upper limit on the sum insured under the scheme – farmers can insure at full production value.
• Use of modern technology
  Technology tools such as remote sensing, drones, and a yield estimation system (YES-TECH) are being introduced to improve accuracy and speed up claim settlement.

Eligibility Criteria 

Below are the key criteria for who can apply under PMFBY and what documents are required:

Farmers / Individual Cultivators / Tenant / Sharecroppers

• Must cultivate notified crops in a notified area (i.e. the area where the scheme is available for that crop) and have an insurable interest in that crop.
• Age between 18 (completed) and 70 (nearest birthday) years.
• Must hold a savings bank account with a participating bank.
• Must register within the prescribed enrollment period for that crop season.
• Must not have already received compensation / insurance for the same crop loss from another source. (To avoid duplication)

Documents required (officially stated):

• Aadhaar number (or proof of identity)
• Land record / survey / khasra number / land title document (to show the crop land)
• Bank account details / passbook (for claim payments)
• Other identity proof (e.g. voter ID, ration card, etc.) as required by state or insurer.

SHGs (Self-Help Groups)

I did not find a standard inclusion of SHGs in the core PMFBY eligibility rules in central guidelines. The official eligibility focuses on farmers / cultivators. PMFBY+1
If any state adapts to allow SHGs (for example, SHG of farmers adopting group insurance), one would need SHG registration, active status, and bank linkage – but this is not confirmed in central guidelines.

FPOs (Farmer Producer Organisations)

Similarly, the central PMFBY documents do not explicitly list FPOs as eligible applicants in place of farmers. The scheme is designed for individual farmers or cultivators growing notified crops.
If a state or insurer allows FPOs, they would need valid registration (e.g. under producer company act), minimum member count, and demonstration of active farming operations – but this is not in central text.

Entrepreneurs / Startups / MSMEs

There is no indication in official PMFBY rules that non-farm enterprise entities (like MSMEs or agri-startups) are eligible to insure “crops” under PMFBY. The scheme is strictly for cultivation and crop risk.
Thus, entrepreneurs / MSMEs are not eligible under the standard scheme, unless they are also cultivators on land.

Application Process

1. Visit official PMFBY portal / registration page
   Go to https://pmfby.gov.in/selfRegistration or https://pmfby.gov.in/farmerRegistrationForm to begin registration.
2. Register / create new farmer account
   Enter your personal details (name, mobile number, Aadhaar number, etc.) and verify via OTP. That creates your user account.
3. Log in and open “Apply for Crop Insurance” (Farmer Corner)
   After login, go to the “Farmer Corner” or “Apply for Crop Insurance” section. Fill in the application form with:
   • Beneficiary details (name, contact)
   • Land / farm / survey / khasra particulars
   • Notified crop(s), area to be insured
   • Bank account / IFSC details for claim transfers
4. Upload / submit required documents
   Commonly required documents include:
   • Aadhaar / identity proof
   • Land record / title / survey / katha / tenancy agreement (if applicable)
   • Bank passbook / bank account proof
   • Crop sowing certificate / land possession proof (if asked)
5. Pay premium (if applicable)
   The farmer pays only the premium share (e.g. 2% for Kharif, 1.5% for Rabi, or as per crop category).
6. Receive acknowledgment / application ID
   After submission, you get an acknowledgment or application number. Use this to track your application status later.
7. Verification / field inspection
   Officials or insurance surveyors may visit fields or request inspections to verify crop, area, and losses (for claims) as needed.
8. Approval & assistance release
   Once verified and accepted, the approved coverage is activated. For claims, the payout is made via direct benefit transfer (DBT) into the farmer’s registered bank account.
9. Offline / alternative route
   If unable to apply online:
   • Visit your nearest bank branch, insurance company office, or agriculture department / Block / KVK / ATMA office
   • Collect the prescribed form from insurer or agriculture office, fill it, attach documents, and submit it before the enrolment cut-off date
   • Often CSC (Common Service Centre) centres also help farmers enroll.
10. Track status
    Use your application ID on the PMFBY portal to check status updates.

Tips to Avoid Common Mistakes

• Always match names (Aadhaar / bank / land documents) exactly to avoid rejection.
• Upload clear, legible documents (scan properly; blurred copies often get rejected).
• Don’t miss the enrollment cut-off date announced by your state – applications past the deadline are not accepted.
• Double check bank account / IFSC details before submitting – incorrect data delays claims.

Challenges or Limitations 

While PMFBY brings useful insurance cover to farmers, implementing it is not without difficulties. Below are some of the common challenges and what a farmer (or official) might do to reduce their impact:

• Delay in claim settlement → In several states, claims get delayed because yield data is late, state subsidy share is not released on time, or disputes between insurer and state arise.
  What to do: Keep your bank account, contact info, and crop details updated; follow up persistently with insurer and agriculture dept; maintain proofs (photos, field logs) to speed verification.
  
  
• Mismatch or errors in beneficiary or land records → Incorrect names, land survey numbers, or document inconsistencies can disqualify claims or delay processing.
  What to do: Before applying, cross-check all records (Aadhaar, land title, bank account) to ensure consistency; correct mismatches early with local land or revenue office.
  
  
• Limited awareness and literacy among farmers → Some farmers don’t know deadlines, scheme details, or how to apply, reducing uptake.
  What to do: Attend local awareness camps, ask extension officers or Krishi Vibhag, and read scheme brochures carefully before enrolment.
  
  
• Narrow application window / seasonal deadlines → There is a fixed window for enrollment before sowing begins; missing this window disqualifies you for that season.
  What to do: Note the official cut-off dates each season (usually announced in state agriculture offices or on the PMFBY portal), and apply well ahead of time.
  
  
• Fiscal burden on states and withdrawal risk → Some states have withdrawn or opted out of PMFBY due to financial constraints or perceived high costs.
  What to do: Encourage local farmers’ unions and panchayats to advocate with the state government for steady subsidy funding; monitor state budget announcements for scheme continuity.
  
  
• Uniform area-approach may leave out individual losses → Because claims are often determined at the level of the revenue circle, a farmer who suffers loss while the broader area shows normal yield may not get compensation.
  What to do: Document your individual losses (photos, neighbor witnesses), and if state rules permit, request localized assessment (for “localized risks”) under the scheme.
  
  
• Complex procedures and document demands → Many farmers find the procedures, digital forms, and document upload requirements complicated.
  What to do: Get help from local agricultural extension or insurance agents; prepare all required documents in advance; use Common Service Centres (CSCs) or nearby offices for guidance.
  
  
• Pending claims due to non-release of State share / subsidy delays → Sometimes, even when an insurer is ready to pay, the state government’s delay in releasing its premium subsidy share holds up claim disbursal.
  What to do: Track whether your state has released a subsidy; request that the central government (when allowed) release its share independently to avoid farmer delays.

Government Support & Future Outlook 

The PMFBY does not stand alone. It is part of a cluster of government schemes aimed at uplifting farmers’ incomes, reducing risks, and improving agri-infrastructure. Some official cross-links include:

• PMFBY is listed alongside PM-KISAN in the Department of Agriculture’s “schemes for welfare of farmers,” showing that income support (PM-KISAN) and risk cover (PMFBY) are intended to work together.
• PMFBY is aligned with the Restructured Weather Based Crop Insurance Scheme (RWBCIS), which is formally integrated under the crop insurance mandate of the Ministry.
• In agricultural scheme compendiums, PMFBY is grouped under “agriculture insurance schemes,” along with WBCIS and other crop-risk programmes, alongside infrastructure and input schemes such as Rashtriya Krishi Vikas Yojana (RKVY).

By combining schemes, a farmer or FPO can get stronger support. For example:

• A farmer enrolled under PM-KISAN may get direct income support, while crop loss is insured under PMFBY. Together, the farmer is less vulnerable to income shocks.
• An FPO that benefits from RKVY support to build storage, combined with crop insurance under PMFBY, reduces both production and post-harvest risk.

Road ahead / updates:

• The scheme was revamped from Kharif 2020 with revised guidelines and more tech integration (remote sensing, improved yield estimation).
• The government has approved continuing PMFBY and RWBCIS up to 2025-26, with a budget allotment of ₹ 69,515.71 crore for 2021–26.
• Future plans emphasize greater convergence – linking insurance, credit, income support, infrastructure, and technology – so farmers do not just receive help in one area but get a more integrated safety net.

Conclusion 

The Pradhan Mantri Fasal Bima Yojana (PMFBY) is an important step by the Government of India to protect farmers from the financial risks caused by crop loss due to natural disasters, pests, or diseases. It helps both small and large farmers secure their income, encouraging them to invest confidently in better seeds and technology. Those who depend on agriculture as their main livelihood – especially smallholders and tenant farmers – benefit the most from its affordable insurance coverage and direct benefit transfer system. Farmers can check eligibility, apply, and track their policy easily on the official portal https://pmfby.gov.in or by visiting their nearest agriculture office. Always verify the latest guidelines, premium rates, and dates on official sources or helplines before applying to ensure smooth processing and maximum benefits.

Explore detailed resources on this scheme and the full suite of programmes at ALL ABOUT AGRICULTURE. For one-on-one assistance, call us at +91 8484002628.