BharatNotes What is PM Fasal Bima Yojana?
Pradhan Mantri Fasal Bima Yojana (PMFBY) is a Central Sector crop insurance scheme launched on 18 February 2016 by the Ministry of Agriculture and Farmers Welfare. It replaced the National Agricultural Insurance Scheme (NAIS) and Modified NAIS, offering farmers a single, affordable insurance product against crop loss. The scheme follows a "One Nation, One Crop, One Premium" approach and covers non-preventable natural risks from the pre-sowing to the post-harvest stage, including droughts, floods, pests, diseases, and localised calamities such as hailstorm and landslide.
Key Features
PMFBY caps the premium that farmers pay, with the government subsidising the remainder.
| Crop category | Maximum farmer premium |
|---|---|
| Kharif food & oilseed crops | 2% of sum insured |
| Rabi food & oilseed crops | 1.5% of sum insured |
| Annual commercial & horticultural crops | 5% of sum insured |
The balance of the actuarial/bidded premium is shared between the Centre and States, generally on a 50:50 basis and 90:10 for North-Eastern States. The scheme operates on the Area Approach, where a defined Insurance Unit (village/village panchayat for major crops) is assessed through Crop Cutting Experiments (CCEs). Since Kharif 2020, enrolment is voluntary for all farmers; earlier it was compulsory for loanee farmers with Kisan Credit Card or crop-loan accounts.
Recent Reforms and Technology
The scheme was revamped in February 2020 to make it voluntary and to expand technology use. In January 2025, the Union Cabinet approved continuation of PMFBY and the Restructured Weather Based Crop Insurance Scheme (RWBCIS) up to 2025-26 with an overall outlay of Rs 69,515.71 crore (for 2021-22 to 2025-26). The Cabinet also created a Fund for Innovation and Technology (FIAT) with a corpus of Rs 824.77 crore to support technology initiatives:
- YES-TECH (Yield Estimation System based on Technology) — technology-based yield estimation, introduced from Kharif 2023.
- WINDS (Weather Information and Network Data Systems) — block-level Automatic Weather Stations and panchayat-level Automatic Rain Gauges for hyper-local weather data.
Current Status (as of nine-year milestone, Feb 2025)
According to government data marking the scheme's ninth anniversary (PIB, Feb 2025), PMFBY had disbursed about Rs 1.75 lakh crore in claims to roughly 23.22 crore farmer applications since 2016, with claims paid significantly exceeding the premium collected from farmers. Annual farmer enrolment rose from 3.17 crore in 2022-23 to 4.19 crore in 2024-25 (about 32% growth).
UPSC Angle
For Prelims, remember the premium caps, the post-2020 voluntary enrolment, the Area Approach/CCE mechanism, and the implementing ministry. For Mains GS3, PMFBY anchors answers on agrarian distress, farm-income security, and tech-enabled governance — candidates should be ready to critique delayed claim settlement, low awareness, and insurer accountability while noting reforms like YES-TECH, WINDS, and the National Crop Insurance Portal. Foundational scheme concept — underpins questions on agriculture, food security, and inclusive growth.
