Modified National Agricultural Insurance Scheme (MNAIS)

   The Pradhan Mantri Fasal Bima Yojana (Prime Minister's Crop Insurance Scheme) was launched by Narendra Modi  on 18 February 2016. It envisages a uniform premium of only 2 per cent to be paid by farmers for kharif crops, and 1.5 per cent for Rabi crops . The premium for annual commercial and horticultural crops will be 5 per cent.

1. OBJECTIVES

The objectives of MNAIS are as under: -

i) To provide insurance coverage and financial support to the farmers in the event
of prevented sowing and failure of any of the notified crop as a result of natural
calamities, Pests & diseases.

ii) To encourage the farmers to adopt progressive farming practices' high value inputs
and better technology in Agriculture.

iii) to help  stabilize farm incomes particularly in disaster years.

2. SALIENT FEATURES OF THE SCHEME

ln addition to Agriculture Insurance Company of India Ltd ' Private sector
insurance companies with adequate infrastructure and experience will be allowed on
selective basis to implement the scheme by the implementing states from out of the companies
 short listed by the Department of Agriculture & Cooperation'

3. CROPS COVERED

i. Food crops (Cereals, Millets & Pulses)
ii. Oilseeds
iii. Annual Commercial / Horticultural crops

(a) Loanee farmers will be covered under compulsory component.
(b) Non - Loanee farmers would be covered under voluntary component
(c) The crops are covered subject to  availability of
         i) the past yield data based on Crop Cutting Experiments (CCEs) for adequate number of years            ii) requisite number of CSEs are conducted for estimating the yield during the proposed season

4. STATES AND AREAS TO BE COVERED

      Modified NAIS is to be implemented as a full-fledged component of NCIP throughout the                    country'

5. FARMERS TO BE COVERED

                 All farmers including sharecroppers, tenant farmers growing the notified crops
     in the notified areas are eligible for coverage.
        includes
      (a) individual owner-cultivator/tenant farmers/share croppers.
      (b) farmers enrolled under contract farming,directly or through pramoters/organizers.
      (c) Groups of farmer/societies serviced by fertilizer companies,pesticide firms,crop growers                       associations,SHGs,NGOs and others
6. RISKS COVERED & EXCLUSIONS

(A) STANDING CROP (Sowing to Harvesting)

           Comprehensive risk insurance is provided to cover yield losses due to non preventable risks.
        (a) Drougnt, Dry spells
        (b) Flood,Inundation and Landslide
        (c) Natural fire and lightening
        (d) pests/diseases
        (e) Strom, Hailstrom,Cyclone,Tornado etc

(B) PREVENTED SOWlNG / PLANTING RlSK

                                    In case farmer of an area is prevented from  sowing / planting due to-deficit
       rainfall or adverse seasonal conditions such insured farmer who failed to sow or plant shall be            eligible for indemnity.The indemnity payable would be a maximum of 25% of sum-insured.

(C) POST HARVEST LOSSES

                  Coverage is available only for those crops, which are allowed to dry in the field after                 harvesting against specified perils of cyclone in coastal areas, resulting in damage to harvested           crop. Further, the coverage is available only upto a maximum period of two weeks from                       harvesting. Assessment of damage will be on individual basis.

GENERAL EXCLUSIONS

        Losses arising out of war & nuclear risks, malicious damage and other preventable risks shall be         excluded.

7. SUM INSURED / LIMIT OF COVERAGE

              In case of Loanee farmers under Compulsory Component, the Sum Insured would be at least        equal to the amount of crop loan sanctioned/advanced, which may extend upto the value of the            threshold yield of the insured crop at the option of insured farmer. Where value of the threshold          yield is lower than the loan amount per unit area, the higher of the two is the Sum Insured.                  Multiplying the Notional Threshold Yield (districUregion/state level) with the Minimum Support        Price (MSP) of the current year arrives at the value of Threshold Yield. Wherever Current year's
       MSP is not available, MSP of previous year shall be adopted. The crops for which, MSP is not            declared, farm gate price established by the marketing department /board shall be adopted.                   Further, in case of Loanee farmers, the Insurance Charges payable by the farmers shall be                   financed by loan disbursing office of the Bank, and will be treated as additional component to             the Scale of Finance for the purpose of obtaining loan.For farmers covered on voluntary basis             the sum-insured is upto the value of Threshold yield of the insured crop. lf the farmer so desire           he may be provided with higher level of risk coverage. Sum insured up to 100% of th res                     hold/average yield of notified area with normal premium subsidy but sum insured above 100%           and up to 150% of the value of average yield without premium subsidy.

8. PREMIUM RATES & SUBSIDY

                  Before the start of each crop season, insurance companies shall work out actuarial                       premium as well as net premium rates (premium rates actually payable by farmers after                       premium subsidy) for each notified crop through standard actuarial methodology approved by             the Govt. of India. Premium structure would be worked out with a discount provision on the               premium in respect of a unit area where all farmers have adopted better water conservation and            sustainable farming practices for better risk mitigation.