What is PMFBY? How may I get the benefits of the scheme?

What is the PMFBY scheme?

The Pradhan Mantri Fasal Bima Yojana (PMFBY) is a scheme contributed by the Center and the State government equally. The primary aim of the scheme is to provide insurance coverage and financial support to the farmers in the event of failure of any of the notified crops, as a result of natural calamities, pests and disease. The scheme also aims to stabilise the farmers’ income to ensure their continuing farming and encourage them to adopt innovative and modern agricultural practices. The scheme was launched in January 2016 as an extension of the National Agricultural Insurance Scheme (NAIS) and Modified National Agricultural Insurance Scheme (MNAIS) with certain key changes adopted such as lowered premiums, wider coverage and faster settlement of claims. This new scheme has incorporated the best features of the earlier crop insurance schemes while removing all their shortcomings.

What are the main features of the PMFBY?

• Lower premiums - under the new scheme, insurance premiums are low and reduced to 2 percent of the sum insurance for all Kharif crops, 1.5 percent for all Rabi crops, and 5 percent for commercial crops or horticultural crops.
• Area approach - scheme operates on an area approach. Hence, all the farmers in the notified area must pay the same premium and have the same claim payments. The area approach that reduces the risk of moral hazard and adverse selection.
• Removal of cap -the artificial cap on the sum insured has been removed and that may incentivize farmers to take up the new scheme.
• Risk coverage - all risks are covered under the new scheme including post-harvest loss and localized risk which were not considered in previous schemes.
• Use of modern technology - The field assessments of actual crop damage and faster settlements of claims would be accomplished through modern technology such as GPS, smartphones, and remote sensing
• Reduction in the notified area - The notified unit has been reduced to the village level under the new scheme
• Subsidy - Under the scheme, farmers contribute a fifth of the premium while Centre and State governments are to contribute the balance on a 50:50 basis to reduce the farmers' risks.

Who is eligible for the scheme?

All farmers, including tenants and sharecroppers in the notified area during the season, are eligible for this insurance protection. It is mandatory for the loanee farmers (who have borrowed institutional crop loan) and Kisan Credit Card holders.

What is protected under the scheme?

The scheme aims to prevent sowing/planting risk where the insured area is prevented from sowing due to deficit rainfall or adverse seasonal conditions, a loss of standing crops due to non-preventive risks - drought, dry spells, flood, inundation, pests and diseases, landslides, natural fire & lightning, storm, hailstorm, cyclone, Typhoon, Tempest, Hurricane and Tornado, post-harvest losses where 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 specific perils of cyclone and cyclonic rains and unseasonal rains.

How to apply for the PMFBY?

An application/nomination for PMFBY is absolutely free. There are two ways to apply for the scheme - offline and online.

• For loanee farmers (credit borrower) - have to register/apply only through banks only from where they have availed agricultural credit because it is mandatory to have crop insurance for them. The Commercial Banks, Co-operative and Regional Rural Banks (RRBs) are involved in the registration.
• Non-loanee farmers - can register/apply online as well as offline

What is the application process?

Offline - Application forms are available at the nearest banks and farmers can submit the filled application or they can visit the Common Service Centre (CSC) for the application. Do not forget to get the submission receipt from the respective agency.

Online - to get benefits of the scheme, farmers need to visit the official website i.e. http://pmfby.gov.in where farmers can submit their application, calculate the premium and also check application status. On the given link, you have to click on “farmer corner” and create an account by clicking on ‘Guest farmer”. You must provide all the details such as name, address, UID (Aadhaar) Number, mobile number and bank account number. Once you create an account, you can Log-in with your credentials and submit the application. Submission receipt will be received on your registered mobile number.

Farmers also can apply through an android smartphone crop insurance app which is freely available on Google Play Store.

What are the required documents at the time of application?

At the time of application, farmers are required to submit following documents:

• a passport photo
• farmer’s ID card (PAN card, driving License, Voter ID, Passport, Aadhaar Card)
• address proof
• bank passbook
• land ownership proof - 7/12 from village revenue officer
• own area proof (generally provided by village revenue officer)
• copy of agreement - In case land is leased in a copy of the agreement with the owner of the farm is required.

What is the last date for application?

It is required that farmers must fill the PMFBY form within 10 days of sowing the crop. However, for Kharif season, the last date of application is 31st of July whereas for the rabi season, it is 31st of December. It is advised, please visit the nearest bank, CSC, insurance company office, village revenue office (Talathi) or Agriculture officer to get more information on the exact date.

Crop insurance is not just a profitable deal but it is a preventive measure against the unpredictable things that could severely affect the crop. The PMFBY is a unique means of protecting farmers from the risk.