Pradhan Mantri Fasal Bima Yojana (PMFBY), launched in 2016, is India's flagship crop insurance scheme covering food crops, oilseeds, and annual commercial crops. It offers comprehensive risk cover against yield losses due to natural calamities, pests, and diseases. The scheme operates on area yield approach with premium rates of 2% for Kharif, 1.5% for Rabi crops, and 5% for annual commercial crops. Government provides premium subsidy with no upper limit. Recent restructuring in 2020 made it voluntary for farmers and introduced technology-driven claim settlements.

PMFBY addresses the critical gap in agricultural risk management by providing affordable crop insurance to farmers. The scheme operates through a three-tier structure involving Centre, states, and insurance companies sharing premium subsidies equally. Area Yield Approach determines claims based on average yield of insured crops in defined areas, making it easier to assess and settle claims. Technology integration through drones, satellite imagery, and mobile apps has improved claim assessment accuracy and reduced settlement time from months to weeks. The 2020 restructuring made enrollment voluntary for non-loanee farmers, giving them freedom to choose insurers and coverage levels. This change aimed to address farmer complaints about delayed claim settlements and inadequate coverage. The scheme's success depends on timely premium collection, accurate yield data, and effective coordination between Centre, states, and insurance companies. Despite challenges like delayed settlements and disputes over yields, PMFBY remains crucial for building farmer resilience against climate risks and ensuring agricultural sustainability in India's monsoon-dependent farming system.