News: An evaluation of Pradhan Mantri Fasal Bima Yojana(PMFBY) has been presented.

Critical evaluation of PMFBY

  • As per the senior Agriculture Ministry officials, of the total earmarked amount of ₹1,400 crore for north-eastern States under PMFBY, only half a percent or ₹8 crore was spent in 2018.
  • Four north-eastern States — Arunachal Pradesh, Nagaland, Manipur, and Mizoram — are not covered under the scheme at all.
  • In the States of North-East and Union Territory of Daman and Diu, firstly, Insurance companies have not shown their interest, secondly, there is lack of state budgetary resources to pay their share of the premium.
  • The reasons for the lack of interest among insurance companies are:
    • High administrative costs
    • There are no proper land records.
    • Historic yield data is not available for these States.
    • It is difficult to conduct CCEs [crop-cutting experiments] needed for many of the horticulture crops
  • This lack of insurance coverage has resulted in thousands of devastated maize farmers due to the attack of armyworm pest there.
  • Some of the states like Bihar and West Bengal have decided to withdraw from the scheme. They are developing their own State-level schemes, while Panjab never participated in the scheme.


  • It is a flagship crop insurance scheme launched by the government. It replaced the previous 2 crop insurance schemes: National Agricultural Insurance Scheme as well as the Modified NAIS.
  • It provides for a uniform premium to be paid by farmers at 2% for all Kharif crops, 5% for commercial and horticultural crops and 1.5% for rabi crops.
  • The government removed the capping against the claims of farmers. Now farmers will get a claim against full sum insured without any reduction.
  • It will encourage the use of technology, such as Smartphones, to capture and upload data of crop cutting to reduce the delays in claim payment to farmers and Remote sensing to reduce the number of crop cutting experiments.  
  • It is compulsory for Farmers in the notified area, who possess a Crop Loan account/KCC account.
  • Comprehensive risk insurance is provided to cover yield losses due to non-preventable risks, such as Natural Fire and Lightning, Storm, Hailstorm, Cyclone, Typhoon, Tempest, Hurricane, Tornado. Risks due to Flood, Inundation and Landslide, Drought, Dry spells, Pests/ Diseases also will be covered.
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