The PMFBY is compulsory for loanee farmers availing crop loans for notified crops in notified areas and voluntary for non-loanee farmers.
Scale of Finance declared by the District Level Technical Committee has been taken as Sum Insured of the crops under the Scheme. There is no capping in premium, however, premium payable by farmers has been substantially reduced and simplified and there is one premium rate on pan-India basis for farmers which would be maximum 1.5%, 2% and 5% for all Rabi, Kharif and annual horticultural/commercial crops, respectively.
Salient Features of PMFBY
i) Provide comprehensive insurance coverage against crop loss on account of non-preventable natural risks, thus helping in stabilising the income of the farmers and encourage them for adoption of innovative practices.
ii) Increase the risk coverage of Crop cycle - pre-sowing to post-harvest losses.
iii) Area approach for settlement of claims for widespread damage. Notified Insurance unit has been reduced to Village/Village Panchayat for major crops
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iv) Uniform maximum premium of only 2%, 1.5% and 5% to be paid by farmers for all Kharif crops, Rabi Crops and Commercial/ horticultural crops respectively.
v) The difference between premium and the rate of Insurance charges payable by farmers shall be provided as subsidy and shared equally by the Centre and State.
vi) Uniform seasonality discipline & Sum Insured for both loanee & non-loanee farmers
vii) Removal of the provision of capping on premium and reduction of sum insured to facilitate farmers to get claim against full sum insured without any reduction.
viii) Inundation has been incorporated as a localized calamity in addition to hailstorm and landslide for individual farm level assessment.
ix) Provision of individual farm level assessment for Post harvest losses against the cyclonic & unseasonal rains for the crops kept in the field for drying upto a period of 14 days, throughout the country.
x) Provision of claims upto 25% of sum insured for prevented sowing.
xi) On-Account payment upto 25% of sum insured for mid season adversity, if the crop damage is reported more than 50% in the insurance unit. Remaining claims based on Crop Cutting Experiments (CCEs) data.
xii) For more effective implementation, a cluster approach will be adopted under which a group of districts with variable risk profile will be allotted to an insurance company through bidding for a longer duration upto 3 years.
xiii) Use of Remote Sensing Technology, Smartphones & Drones for quick estimation of crop losses to ensure early settlement of claims.
xiv) Crop Insurance Portal has been launched. This will be used extensively for ensuring better administration, co-ordination, transparency and dissemination of information.
xv) Focused attention on increasing awareness about the schemes among all stakeholders and appropriate provisioning of resources for the same.
xvi) The claim amount will be credited electronically to the individual farmer's Bank Account.
xvii) Adequate publicity in all the villages of the notified districts/ areas
xviii) Premium rates under Weather Based Crop Insurance Scheme (WBCIS) have also been reduced and brought at par with new scheme. Further, capping on Actuarial premium and reduction in sum insured has been removed in this scheme also.
xix) In addition, a Unified Package Insurance Scheme (UPIS) has also been approved for implementation on pilot basis in 45 districts of the country from Kharif 2016 season to cover the other assets/activities like machinery, life, accident, house and student-safety for farmers along- with their notified crops (under PMFBY/ Weather Based Crop Insurance Scheme - WBCIS).
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