Federal agency to distribute 3,200 billion rupees in crop insurance benefits to 30 million farmers today under Prime Minister Fasadia Insurance Program
Pradhan Mantri Fasal Bima Yojana (PMFBY) Streamlines Claim Settlements and Boosts Transparency
In a significant move to support farmers, the Indian government has announced a series of reforms to the Pradhan Mantri Fasal Bima Yojana (PMFBY), a crop insurance scheme launched in 2016. These changes aim to simplify claim settlements, enhance transparency, and speed up payments to farmers.
The reforms include the introduction of the National Crop Insurance Portal (NCIP), a centralized platform for data, subsidy payments, farmer enrollment, and electronic claim transfers directly to farmers' bank accounts. This digital platform has improved transparency and timely service delivery.
Additionally, the ‘Digiclaim Module’, operational since Kharif 2022, integrates the NCIP with the Public Finance Management System and insurance accounting systems. This integration supports efficient, transparent, and faster settlement of crop insurance claims.
To further enhance accountability, the operational guidelines have been comprehensively revised periodically. Importantly, the government has implemented penalty provisions for insurance companies that delay claim disbursal beyond stipulated timelines. Such penalties reinforce credit discipline and accountability within the implementing public sector banks and insurance companies.
These measures—centralized digital platforms, integration of financial and insurance data systems, revised operational frameworks, and penalty enforcement—have together made PMFBY more transparent, efficient, and timely in delivering insurance claims to farmers.
Under the revised rules, claims can be paid proportionately based only on the central subsidy, without waiting for a state's contribution. Over Rs 3,200 crore in crop insurance claims will be directly transferred to the bank accounts of more than 30 lakh farmers across the country. This marks the first time such a large-scale claim payout is being executed in a single day through Direct Benefit Transfer (DBT).
The Pradhan Mantri Fasal Bima Yojana will hold a mega disbursement event on August 11, 2022, in Jhunjhunu, Rajasthan. Farmers from various states, including Rajasthan and Madhya Pradesh, will receive significant amounts. Chhattisgarh farmers will get Rs 150 crore, and those in other states will receive Rs 773 crore. The event will be attended by Rajasthan Chief Minister Bhajanlal Sharma, Union Minister of State for Agriculture Bhagirath Choudhary, Rajasthan Agriculture Minister Dr. Kirodi Lal Meena, farmer leaders, and senior officials.
Since its launch in 2016, PMFBY has processed more than 78 crore farmer applications and disbursed Rs 1.83 lakh crore in claims against Rs 35,864 crore in premiums paid by farmers, an average payout of over five times the premium amount. From the Kharif 2025 season, any delay by state governments in paying their share will attract a 12% penalty. Insurance companies delaying settlements will also have to pay 12% interest to farmers.
These technology initiatives, including YES-TECH, WINDS, AIDE mobile app, Krishi Rakshak Portal, and helpline number 14447, have improved weather data accuracy, enabled village-level registration, and ensured faster claim processing. The Cabinet has extended PMFBY and RWBCIS till 2025-26 with an additional allocation of Rs 824.77 crore for technology initiatives.
PMFBY also encourages greater agricultural investment, contributing to the vision of an Atmanirbhar Bharat. The event in Jhunjhunu aims to provide financial security to farmers during crop loss. Farmers from Jhunjhunu, Sikar, Jaipur, Kotputli-Behror, and nearby districts will participate in person, while lakhs of farmers from across the country are expected to join virtually.
Technology and sports may seem unrelated to the Pradhan Mantri Fasal Bima Yojana, but their principles can be applied in streamlining the claim settlement process in this agricultural insurance scheme. Just as sports teams use data analytics for strategic decisions, the introduction of the National Crop Insurance Portal (NCIP) comprises a centralized data platform that ensures timely and accurate data, thereby improving decision-making for farmers and insurers. Similarly, the 'Digiclaim Module' integrates various systems, akin to how sports teams synchronize their playbooks, promoting efficiency and transparency in claim settlements.
