The new Pradhan Mantri Fasal Bima Yojana is a new-age crop insurance scheme that is aligned with the vision of the One Nation One Scheme. While it includes the relevant and eminent features from preceding schemes in this area, the Fasal Bima Yojana actually manages to remove the inadequacies and weaknesses, replacing them with clear, concise, and pertinent clauses. The PMFBY, therefore, will replace two existing schemes viz. The National Agriculture Insurance Scheme and the Modified NAIS. Briefly discussing the objectives of PMFBY, the scheme is directed towards:
The PMFBY covers all the farmers who are involved in the practice of growing notified crops within a notified area in a certain season. Therefore, any farmer having an insurable interest in crops as per the said parameters is covered by this scheme. Further, in order to better deliver the promise of this scheme, the scheme has been made voluntary starting the Kharif season of 2020 for all the farmers. Such voluntary coverage can be obtained by all the farmers who aren’t mandated to be enrolled in the scheme, and the voluntary enrolment option will extend to Crop KCC/ Crop Loan Account Holders who have not had their credit limit renewed.
The mandatorily enrolled persons (as per prior to Kharif 2020) include:
Looking at some of the key implications and provisions of the PMFBY scheme, here’s a gist of our observations and understanding –
The premium rates have been kept extremely nominal as a result of subsidy by the government whereby the balance amount that would otherwise accrue to the farmers, is going to be paid by the Government and in case of a triggering event, the entire amount of insurance will be paid out to the farmer, to the extent of loss due to calamities and causes notified.
(Threshold yield – Estimated Yield) x Sum insured x 25% of Threshold Yield)
The farmer, to be eligible to claim such money is required to intimate the insurer within 71 hours from such happening of the trigger event.
The assessment is done with 15 days of such intimation and the pay-out is done without waiting for transfer payment from the Government.
We hope that this guide gave you a better understanding of the PMFBY scheme. For anything else, do check out our blogs HERE.
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