Pradhan Mantri Fasal Bima Yojana (PMFBY) - How extended coverage of wild-animal attacks and paddy-inundation matters?
Background
The Pradhan Mantri Fasal Bima Yojana (PMFBY), launched in 2016, is a flagship programme designed to provide insurance coverage and financial support to farmers in scenarios of crop failures due to natural calamities, pets & diseases. The scheme provides a uniform and transparent risk coverage at affordable premiums and ensures timely settlement of claims.
As per the scheme, farmers pay a portion of the premium – 2% of the sum insured for Kharif crops, 1.5% of the sum insured for Rabi crops and 5% of the sum insured for horticultural crops. Rest of the premium is paid equally by the Centre and the states, except for northeastern states and Himalayan states where center bear most of the burden.
Since inception, over 78 crore farmer applications have been covered and of these over 22 crore farmers have received claims of more than INR 1.8 lakh crore[1].
The scheme currently covers protection under four broad risks-
a. Standing Crop Losses- Losses due to non-preventable reasons such as Natural Fire and Lightning: Storm, Hailstorm, Tornado etc.: Flood, Inundation and Landslide; Pests/ Diseases, Drought etc.
b. Prevented Sowing- Farmers that may or may not want to sow because of unfavourable weather conditions, they become eligible for indemnity claims of up to 25% of sum insured.
c. Post Harvest Losses- Harvested crops damaged due to unseasonal rains
d. Localised Calamities- Damage resulted due to local risks such as hailstorms, landslides and floods.
The government on November 18, 2025, extended the scheme to cover damages caused by wild animals’ attack under the 4th risk category of localised calamities. Besides, paddy losses from inundation have also been reinstated after it was removed from the localised calamity category in 2018. The scheme will be rolled out from Kharif 2026.
Table 1 below provides a comparison of what the scheme offers then and now-
(Source: PIB)
Also Read: G20 Summit 2025
Extent of the Losses
Wild Animal Attack
1. A study done by Centre for Sustainable Development at the Gokhale Institute in Maharashtra states that farmers lose around INR 10000 to INR 40000 annually due to crop damages by wild animals and they barely get 1% of the losses as compensation.
2. Odisha Forest Department Reports reveal that the incidences of crop damages by elephants rose five times during 2010 to 2020. Similarly, Uttarakhand, Chhattisgarh, Jharkhand, Assam etc also report growing incidences of such crop damages.
Paddy Inundation
1. A study has shown that India’s 30% of the paddy area (Around 10-12 ha) is prone to floods.
2. States including Assam (40%), Bihar (73%) etc. have flood prone area under rice crop.
Impact Assessment
Considering the extent of the losses occurring under these two categories and the fact that a huge number of claims has already been settled (excluding wild animal attacks and paddy inundation), the absolute magnitude of these risks (even if it accounts for a small percentage) is non-trivial.
Hypothetical Assessment
Even if these categories of crop losses together accounted for just 1% of PMFBY’s cumulative settlements of INR 1.83 lakh crore, the corresponding loss would be nearly INR 1,830 crore, which is a massive burden that has so far remained entirely under-reported.
Challenges/Issues
1. A 72-hour window seems unreasonable considering poor connectivity in key areas considered in these categories.
2. Difficulty in capturing and uploading geotagged images due to limited awareness/ skills possessed by the farmers.
Overall, the addition of wild-animal attack and the reintroduction of paddy-inundation covers make the flagship scheme more inclusive and responsive, a step closer to its vision of protecting farmers and supporting India’s agricultural sector.
Contact: policyprism02@gmail.com for Research, Publication, & Consultancy
[1] https://www.pib.gov.in/PressNoteDetails.aspx?NoteId=155010&ModuleId=3