All Farmer having insurable interest can be covered under these scheme including sharecroppers and tenant farmers. It is mandatory for all the farmers to insist on insurance coverage as per provisions of the Scheme.

• Any change in crop plan should be brought to the notice of any nearest bank branch/ PACS/ authorized channel partner/ insurance intermediary of insurance company within one week of sowing.
• Insurance Proposals are accepted only upto a stipulated cut-off date as declared by the SLCCCI.

The Scheme would be optional for all the farmers and cultivators desirous of availing insurance under PMFBY for any notified crop in any notified insurance unit may approach nearest bank branch/ PACS/ authorized channel partner/ insurance intermediary of insurance company within cut-off date, fill-up proposal form completely in prescribed format, submit form and deposit requisite premium to bank branch/ Insurance Intermediary / CSC along with necessary documentary evidence regarding his insurable interest in cultivating land/ crop (e.g. ownership/tenancy/ cultivation rights) proposed for insurance.

• The farmer desiring for coverage should open/operate an account in the branch of the designated bank, and the details should be provided in the proposal form.
• The farmers should mention their land identification number in the Proposal and must provide documentary evidence with regard to possession of cultivable land. The cultivator must furnish area sown confirmation certificate.
• The farmer should ensure that he gets insurance coverage for a notified crop(s) cultivated/proposed to be cultivated, in a piece of land from a single source only. No duplicate or double Insurance is allowed and in any such cases farmer will not be eligible for coverage. The insurance company shall reserve the right to repudiate all such claims and not refund the premium as well in such cases.
• Company may also take legal action against such farmers.

Scheme also aims covering maximum farmers under SC/ ST/ and Women Farmers.

• Food Crops (Cereals, Millets and Pulses)
• Oilseeds
• Annual Commercial /Annual Horticulture Crops

Implementation Agency (IA) shall be done by the concerned State Government for implementation of the scheme in their respective State. Such selection of IA shall be done from amongst the designated / empaneled insurance companies.

The final selection of IA is from amongst the pre-qualified insurance companies, which shall be done based on the lowest weighted premium quoted by a pre-qualified company for all notified crops within the cluster of districts.

• Notified Area is the Unit of Insurance decided by the State Govt. for notifying a Crop during a season.
• The size of the Unit of Insurance shall depend on the area under cultivation within the unit. For major crops, the Unit of Insurance shall ordinarily be Village/Village Panchayat level and for minor crops may be at a higher level so that the requisite number of Crop Cutting Experiments (CCEs) could be conducted during the notified crop season.
• States may notify Village / Village Panchayat as insurance unit in case of minor crops too if they so desire.

The Actuarial Premium Rate (APR) is calculated on the Sum Insured (SI). The maximum premium rate payable by farmers under this scheme is determined as per the following table:

Sum Insured per hectare for both loanee and non-loanee farmers will be same and equal to the Scale of Finance as decided by the District Level Technical Committee, and would be pre-declared by SLCCCI and notified.

Sum Insured for individual farmer is equal to the Scale of Finance per hectare multiplied by area of the notified crop proposed by the farmer. ‘Area under cultivation’ shall always be expressed in ‘hectare’. Sum insured for irrigated and un-irrigated areas may be separate.

The Pradhan MantriFasalBimaYojana covers the following risks:

Prevented sowing/planting risk – (On Notified Area Basis)

In case of majority of insured crops of a notified area are prevented from sowing/planting due to adverse weather conditions such as deficit rainfall or adverse seasonal conditions, the insured crops that will be eligible for indemnity claims upto maximum of 25% of the sum-insured.

• Coverage is applicable to farmers in case of widespread incidence of eligible risks affecting crops in more than 75% of area sown in a notified unit at early stage leading to total loss of crop or farmer is not in a position to either sow or transplant the crop ( or ) either sowing or germination of crop due to deficit or excess rainfall.
• Eligibility Criteria:

  Only those farmers who have paid the premium / the premium has been debited from their account before the damage. The State Government would provide Notified Insurance Unit and crop wise normal area sown at the beginning of the season within 15 days.
  “Prevented Sowing/ Planting” pay-out only if more than 75% of Crop Sown Area for notified crop remained unsown due to occurrence of any of the above perils.

• Loss assessment procedure:

  The cover will be available for major crops only.
  The payout will be 25% of total sum insured and the policy will be terminated after that.
  

  Note: The Insurance company will disburse claims within 30 days of State Govt. notification / order, subject to receipt of premium, as per scheme guidelines.

• Standing crop (sowing to harvesting) – (Yield Losses)

• Coverage: Comprehensive risk insurance is provided to cover yield losses due to non-¬preventable risks, viz.

  • Natural Fire and Lightning
  • Storm, Hailstorm, Cyclone, Typhoon, Tempest, Hurricane, Tornado etc
  • Flood, Inundation and Landslides
  • Drought, Dry spell
  • Pests/ Diseases.

  On account payment of claims due to mid season adversity of claims isapplicable for standing crops in case of floods, prolonged dry spells, severe drought etc , where expected yield will be less than 50%.

  Eligibility Criteria for farmers who have paid the premium or whose premium has been debited from their account before the damage.

  Note: If adversity occurs within 15 days before the normal harvest time, this provision will not be invoked. The provision is invoked by the State Government through damage notification based on the proxy Indicators.

  Loss assessment procedure:

  Joint Loss Assessment so conducted with government and if applicable the On-account payment would be calculated as per following formula: (Threshold Yield - Estimated Yield) × Sum Insured × 25%
  Threshold Yield
  Note: Maximum amount payable would be 25% of the likely claims, subject to adjustment against final claims.

  Time frame for loss assessmentand submission of report

  Eligibility on account Loss Details will provided by government within 7 days after the damage. Loss assessment will be completed within 15 days after the damage. The On-account payment would be disbursed by the insurance company, subject to receipt of premium, as per scheme guidelines.

• Post harvest losses – (Individual Farm Basis)

  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 Hailstorm, Cyclone and Cyclonic rains and unseasonal rains.
  The damage to the harvested crop after “cut and spread” in field due to cyclone, cyclonic rains and unseasonal rains throughout the country resulting in damage to harvested crop.
  Maximum period is two weeks (14 days) from harvested date to drying purpose

  Eligibility criteria:

  Only those farmers who have paid the premium / the premium has been debited from their account before the damage.
  Damaged by specified perils, up to 14 days after the harvesting is done.

  Loss assessment procedure:

  Farmer needs to provide Intimation within 72 hrs after the damage and Intimation must contain details of survey number-wise insured crop and acreage affected. Farmer should also subsequently provide the filled Claim form along with all relevant documents as requisite for payment of claims. The Loss assessor will be appointed, and assessment will be completed within stipulated timelines post which the claims will be settled after the loss assessment report is finalized, subject to receipt of premium, as per scheme guidelines.

• Localised Calamities – (Individual Farm Basis)

  Loss / damage resulting from occurrence of identified localized risks i.e. Hailstorm, landslide, Inundation, Cloud burst and Natural Fire due to lightening affecting isolated farms in the notified area.

  • If crop losses occur due to any localized perils/calamities such as Landslide, Hailstorm and inundation which affect part of a notified unit or a plot the farmer is eligible to claim for a localized calamity.

  • Eligibility criteria:

    Only those farmers who have paid the premium / the premium has been debited from their account before the damage can claim.

    Note: Maximum pay-out would be in proportion to cost of inputs, incurred up to the occurrence of insured peril, subject to the sum insured.

    If the payout under area approach (based on CCEs data) is more than localized losses, the higher claims of two will be payable to insured farmers, subject to receipt of premium, as per scheme guidelines

  • Loss assessment procedure:

    Farmer needs to provide Intimation within 72 hrs after the damage and Intimation must contain details of survey number-wise insured crop and acreage affected. Farmer should also subsequently provide the filled Claim form along with all relevant documents as requisite for payment of claims. The Loss assessor will be appointed, and assessment will be completed within stipulated timelines post which the claims will be settled after the loss assessment report is finalized, subject to receipt of premium, as per scheme guidelines.

• Add-on coverage for crop loss due to attack by wild animals:

  The States may consider providing add-on coverage for crop loss due to attack by wild animals wherever the risk is perceived to be substantial and is identifiable. Detailed protocol and procedure for evaluation of bids will be issued separately by GOI in consultation with Ministry of Environment and Forest and GIC Re.

• War & kindred perils, nuclear risks, riots, malicious damage, theft, act of enmity, grazed and/or destroyed by domestic and/or wild animals.
• In case of Post–Harvest losses the harvested crop bundled and heaped at a place before threshing, other preventable risks are excluded.

• State/ UT should conduct requisite number of Crop Cutting Experiments (CCEs) at notified insurance unit area on a sliding scale basis.
• State/ UT to submit CCE based yield data to insurance companies within the prescribed time limits i.e. within one month from the date of final harvest.
• State/ UT should facilitate strengthening of automatic weather station network for the purpose of on account payment settlement.
• State/ UT to adopt modern technology for conduct of CCEs.

Coverage is not provided for 100% of the crop value. The Sum Insured is basis the cost of input of cultivation of crop. Then basis the riskiness of the crop the level of indemnity is fixed at district and crop level in different levels such as

- 70% corresponding to High Risk,

- 80% to Moderate Risk and

- 90% to Low Risk.

State level crop coordination committee approves the respective scale of finance and Indemnity level for notified crop and area prior to tender process in the States. Hence the coverage for the farmer is basis the final amount declared by the State level crop coordination committee.

• Difference between actuarial premium rate and farmer payable premium rate shall be treated as Normal premium subsidy rate, which shall be shared equally by Central and State Govt.
• However, the State/ UT Governments are free to extend additional subsidy over and above the stipulated subsidy from its budget.

• Yield losses at Notified Area level: Once the Yield Data is received from the State/UT Govt. as per the prescribed cut-off dates, claims will be processed, approved and settled by implementing agency.
  If the ‘Actual Yield’ (AY) per hectare of the insured crop for the defined area [on the basis of requisite number of Crop Cutting Experiments (CCEs)] in the insured season, falls short of the specified threshold yield(TY), all the insured farmers growing that crop in the defined area are deemed to have suffered shortfall in their yield.
  The Scheme seeks to provide protection against such contingency to all insured farmers of an Insurance Unit.
  Claim Pay-outs based on Yield losses shall be calculated as per the following formula:
  (Threshold Yield – Actual Yield)
  ———————————————* Sum Insured
  Threshold Yield

• Assessment of prevented Sowing losses: The adverse weather conditions shall be defined in the notification and shall be captured by notified weather station/s in the District. The extent of claims payable will be decided on the basis of weather data recorded at the notified weather station/s for the purpose. The insurance coverage shall cease to operate for the crop in the notified area. The cover is available during Kharif season for recognized rain-fed areas and crops. The data provider will be notified by the SLCCCI.

• Localized Calamity Loss Assessment: Wide Spread Calamities: Loss assessment and modified indemnity procedures in case of occurrence of localized perils, such as hailstorm, landslide, flood, and inundation Cloud burst and Natural fire due to lightening shall be for a cluster of affected farms or affected village and the settlement of claims, if any, will be each insured farmer covered under assessment.

• Post-Harvest Loss Assessment: Loss assessment and indemnity procedures in case of occurrence of Post-Harvest Loss shall be for a cluster of affected farms or affected village and the settlement of claims, if any, will be each insured farmer covered under assessment.

All the enrolments under this scheme should be done before the cutoff date as mentioned in the State Government notification of every state. Also, the farmer should pay the share of his premium duly remitted by the Bank or Intermediary within the cutoff date to the Insurance Company. If there is a delay in enrolling and submitting the premium beyond the cutoff date, then the Insurance Company has the right to reject coverage.

Loanee Farmer – Financial institutions

Based on seasonality of Crops, banks should separately calculate the eligibility of loan amount for both Kharif and Rabi seasons based on the scale of Finance and declared acreage of individual loanee farmer under notified crops and shall be taken into consideration.

Crop loan under Kisan Credit Cards (KCC) are also covered under through banks and shall maintain all records relating to compliance with these scheme.

Nodal Bank will be responsible for collection of proposal and premium from loanee farmer.

Individual bank branches for Commercial Banks/ RRBs shall act as Nodal branch. Necessary guidelines to concerned bank branches will be governed by concerned Lead bank and Regional offices/ Administrative offices of commercial banks/ RRBs.

Declaration submitted by Nodal banks/ Branches shall contain details about Insurance Unit, sum insured per unit, premium per unit, total area insured, and category of farmers covered (small and marginal or other) and number of farmers under other categories (SC/ST/ others) / Women along with their bank account details etc. (bank / their branches) as per the format envisaged / provided in the crop insurance portal.

The bank branches of commercial banks/ RRBs will directly submit the consolidated proposals along with details of insured farmers in the format as governed in the crop insurance portal within the stipulated time.

Nodal Banks/ Intermediaries to collect the list of individual farmers with requisite details like Farmer name, Bank A/c No, Village, Category of farmers, Acreages, Crop, Sum Insured, Premium Collected, Govt. Subsidy etc., from concerned branches in soft copy and send the same to insurance company along with declaration within 15 days of final cut-off dates.

• Non Loanee Farmer - Channel partner/ Intermediaries

  All those farmers who have not availed the SOA loans and having the insurable interest can be covered simply by visiting to nearest commercial bank or Regional Rural Bank (RRB) or PACS (DCCB) branch. Bank official will assist and guide the farmers related to filling of the proposal form, relevant documents, Sum insured and applicable premium Etc. Operating a bank account is essential for such cases.

  All those farmers who have not availed the SOA loans and having the insurable interest can also be covered simply by filling the proposal form and relevant documents with requisite premium amount and can submit the same to approved and designated by IRDA, Intermediaries. Designated intermediaries to verify the insurable interest and relevant document pertaining to Land Record, 7/ 12 Extract or Record of Land Rights, Sowing Certificate, ID Proof, Bank Passbook, Cancelled Cheque – Only if required Photo ID is not available in bank passbook and applicable contract/agreement in case of sharecroppers or tenants. Intermediaries to collect and submit the requisite premium and remit individual/ consolidated premium to insurance company, accompanied by individual proposal forms and summary details in Declarations/ Listing sheet (MIS), provide soft copy to IA and details of each insured farmer and will also upload the data directly to the crop insurance portal.

• Non Loanee Farmer under Optional component – Directly to Insurance Companies.

  Non loanee farmers having insurable interest can send the proposal form through Post to insurance companies Or can also avail insurance through insurance companies Online portal or through Crop Insurance portal with requisite premium and relevant document i.e. Land record or applicable Agreement/ Contract in case of sharecroppers or tenants. Insurance companies retain the right to accept or reject the insurance proposal. Premium will be refunded by insurance companies within 1 month of receipt of proposal, if any proposals are rejected.

In case the farmer changes the crop to be sown, he should intimate the change to insurance company, at least 30 days before cut-off-date for buying insurance or sowing either through financial institution/ channel partner/ insurance intermediary/ directly; as the case may be, along with difference in premium payable, if any, accompanied by sowing certificate issued by concerned village/ sub-district level official of the State. In case the premium paid was higher, insurance company will refund the excess.

As per the PMFBY guidelines and cut off dates vary for different intermediaries and Banks the overall loaning period for covering of loanee farmers under would be, for Kharif – April to July and Rabi – October to December. a. Bankers to collect premium from Farmers - Cut-off dates for receipt of proposal form/ debit of premium from farmers account for both Loanee and Non loanee farmers would be, for Kharif – 31st July and Rabi – 31st December b. Bankers to submit to Insurance company - Cut-off dates for receipt of consolidated declaration/ proposal from Nodal bank/ Bank branches would be within 15 days for Loanee farmers and 7 days for Non loanee farmers from cut-off date of debit of premium from farmers account for Kharif and Rabi season respectively. c. Insurance intermediaries to submit to Insurance company - Cut-off dates for receipt of Proposal from designated Insurance Agent’s would be within 7 days of receipt of declaration/ premium respectively. It may be noted that neither DAC & FW nor any State/ UT Government will be authorized to extend the cut-off dates of seasonality under any circumstance once it is fixed and notified.

Bank and other financial institutions etc. shall be paid service charges @4% of the premium collected from farmers. Rural agents engaged in providing insurance related services to farmers may be paid appropriate commission as decided by the insurance company, subject to prescribed under IRDA regulations.

For State Govt. / UT, Cut-off dates need to finalize all the yield data post crop cutting and provide all the Yield data to Insurance Companies within one month from the date of final harvest.

PMFBY is a replacement scheme of NAIS / MNAIS, and hence exempted from Service Tax liability of all the services involved in the implementation of the scheme.