National Agricultural Insurance Scheme 2024

National Agricultural Insurance Scheme 2024 : Agriculture in India is highly vulnerable to hazards like drought and floods. It is necessary to protect farmers from natural calamities and ensure their credit eligibility for the next season. For this purpose, the Government of India introduced several agricultural social insurances across the country, the most important of which is the Pradhan Mantri Crop Bima Yojana.


The objectives of the National Agricultural Insurance Scheme are as follows:

  • To provide insurance benefits and financial assistance to farmers in case of failure of any proposed crop due to natural calamity, pest or disease.
  • To encourage farmers to adopt progressive farming methods, high value inputs and high technology in agriculture.
  • To help stabilize farm income, especially in disaster years.

Reformed National Agricultural Insurance Scheme

The Cabinet Committee on Economic Affairs has approved the revised National Agricultural Insurance Scheme (MNAIS). In order to overcome the shortcomings and make it more comprehensive and farmer oriented, the revised NAIS has been prepared by incorporating necessary changes/amendments in consultation with the States.

With the launch of the revised scheme, it is expected that a large number of farmers will be able to better manage risks in agricultural production and maintain stable agricultural income, especially in the event of crop failure due to natural calamities. .

Keeping in view the various risks arising in agricultural production, the Ministry of Agriculture implemented the National Agricultural Insurance Scheme (NAIS) as a central sector scheme from rabi season 1999-2000 to provide protection to farmers against these risks. On the basis of the experiences gained from its implementation, it was re-evaluated which revealed several shortcomings in the scheme.

Coffee debt relief package

An estimated 75,000 coffee producing smallholder farmers benefited from the coffee debt relief package.

For debt-ridden small coffee farmers, the government has provided a total of Rs. 241.33 crore has been declared. The Coffee Debt Relief Package 2010 of 2010 was approved for implementation. A total of 78,665 loan holder coffee farmers were assessed out of which 74,929 (95%) were small farmers who were expected to benefit from arrears waiver and restructuring under this package and the remaining 3736 (5%) were medium and large farmers. Farmers were targeted to benefit from loan restructuring. The package has been finalized and its implementation is underway.

Salient features of the scheme

1. ripe under

Crops of the following major groups, in respect of which (1) data regarding harvest experiments are available for appropriate years and (2) harvest experiments necessary to estimate the quantity of production in the proposed season have been carried out –

  • Food crops (cereals, grasses and legumes)
  • Oilseeds
  • Sugarcane, cotton and potato (annual commercial or annualhorticultural crops)
  • Other annual commercial or annual horticultural crops, last three years of data available. Information about which crops will be included in the next year will be given in the current season itself.

2. states and territories brought under it

  • This scheme is applicable in all states and union territories. States or Union Territories opting to join the scheme have to prepare a list of crops to be covered under the scheme.
  • Exit Rules – States joining the scheme will have to remain in it for at least three years.

3. Farmers brought under this

  • All farmers including sharecroppers, tenants, prescribed crops growing in prescribed areas are eligible to join the scheme.
  • It may include the following groups of farmers-
  1. Compulsory Basis – All those farmers who cultivate the prescribed crop by taking loans from financial institutions for seasonal agricultural work, i.e. loan borrowers.
  2. On Voluntary Basis- All other farmers cultivating the prescribed crop, i.e. non-loan farmers.

4. Perils Covered and Exclusions

  • Integrated catastrophe insurance will be provided to cover crop damage due to the following non-restricted perils-
  1. Natural fire and lightning
  2. Storm, storm, typhoon, sea storm, earthquake, cyclone, tide etc.
  3. Floods, submergence and landslides.
  4. Drought, famine.
  5. Pests or diseases etc.
  • Damages caused by war and nuclear war, bad intentions and other controllable risks are excluded.

5. Limit of Sum Assured-Coverage

  • At the option of the insured farmer, the sum insured may be increased up to the total produce of the insured crop. Farmers can increase the price of their crop by up to 150 percent, if the crop is notified and they are willing to pay a premium over the commercial rate.
  • In case of farmers taking loan, the sum insured should be equal to the amount of advance taken for the crop.
  • In case of farmers taking loans, insurance charges will be added to the advance taken by them.
  • The guidelines of Reserve Bank of India and National Bank for Agriculture and Rural Development (NABARD) will be valid for disbursement of crop credit.

6. Premium Rates

Serial NumbersessionCropPremium rates
1KharifMillets and oilseeds3.5 percent of the sum assured or actual, whichever is less
  Other crops (cereals and pulses)2.5 percent of the sum assured or actual, whichever is less
2Rabiwheat1.5 percent of Sum Assured or Actual, whichever is less
  Other crops (cereals and pulses)2.0 percent of Sum Assured or Actual, whichever is less
3Kharif and RaviAnnual commercial or annual horticultural cropsreal

In case of grains, grass, pulses and oilseeds the actual assessment will be based on the average of last five years. The actual rate will be applied at the District, Territory or State level at the option of the State Government or Union Territory.

9. Procedure for Acceptance and Settlement of Claims

  • Once the yield data is received from the State or Union Territory Government as on the specified date, the claims will be settled by the Insurance Agency (IA).
  • Claim checks with particulars will be issued in the name of specific nodal banks. The lower tier banks will transfer the amount to the farmer’s account and display it on their notice boards.
  • In case of localized calamities like storm, cyclone, landslide, flood etc., the Insurance Agency (IA) will adopt a procedure to assess the loss suffered by the farmers. In this order, consultation will be taken from the District Agricultural Centre, State or Union Territory. Such claims will be settled between the Insurance Agency (IA) and the insured.
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Which is the implementing agency for National Agricultural Insurance Scheme?

Agricultural Insurance Company of India (AIC) Ltd. is the implementing agency of the National Agricultural Insurance Scheme.

When was the National Agricultural Insurance Scheme launched?

Among the more successful national insurance schemes targeted at crop protection, the National Agricultural Insurance Scheme was introduced by the government in 1999-2000 and was designed to protect farmers against failure of their crops.

Which state launched crop insurance scheme?

The first crop insurance program was started in 1972-73 by the ‘General Insurance’ division of the Life Insurance Corporation of India on H-4 cotton in Gujarat.

Which is the number 1 agriculture company in India?

UPL Ltd. is one of the top 5 global providers of total agriculture solutions with a footprint in 138+ countries.

What is the impact of crop insurance?

Crop insurance reduces farm risk by reducing business risk (BR), 1 by easing credit constraints and improving farm liquidity through compensation payments.

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