Pradhan mantri Fasal Bheema Yojana

The new scheme replaces two existing shemes

  1. National Agricultural Insurance scheme 1999
  2. Modified National Agricultural scheme 2010

Problems with existing scheme:

  1. High premium
  2. Linkage to crop loans
  3. cap on claims to abysmal coverage

Features of new scheme:

1.Uniform Premium:

  • 1.5% premium for Rabi crops
  • 2% Premium for Kharif Crops
  • 5% premium for Annual horticulture and commercial crops
  • Remaining premium will be paid by the govt

2.There will be no upper limit subsidy given by Govt even if balance premium is 90%

3.Provisions of capping on premium rate has been removed and farmers get claim against      full sum insured

  • It was removed because low claims being paid to farmers to avoid govt outgo

4.Govt encourages use of technology mainly smart phones and remote sensing

5.Will increase the total coverage area to 50% of crop area from existing level of 25-27 %

Shortcomings of new scheme:

  1. Ambiguity over whether insurance unit is village or block or something else
  2. No clarity on the fate of tenant farmers whether they came under new scheme or not
  3. Equal sharing of premium between states and central might be problematic since states  allocate meagre  funds to agriculture in their budget

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