Archive · 26 Jul 2025
Crop Insurance Default by States Exceeds Rs 6,450 Crore in 5 Years
Imagine farmers buy insurance to protect their crops from bad weather.
The government helps pay for this insurance.
However, some states haven't paid their share, owing billions of rupees.
The government is making rules to fix this, like requiring states to pay their share in advance.
More farmers are signing up for crop insurance because it helps them a lot when their crops get damaged.
For every small amount farmers pay, they receive a much bigger amount in claims if something bad happens to their crops.
States have defaulted on over Rs 6,450 crore in crop insurance claims in five years.
Andhra Pradesh, Rajasthan, and Madhya Pradesh are among the biggest defaulters.
The government mandates escrow accounts for state premium deposits to reduce claim delays.
Enrollment in the crop insurance scheme has increased by 32% since 2022-23.
Farmers have received nearly Rs 500 in claims for every Rs 100 of premium paid.
- Who
- States, farmers, and insurance companies involved in the Pradhan Mantri Fasal Bima Yojana (PMFBY).
- What
- States have defaulted on over Rs 6,450 crore in crop insurance claims.
- When
- Over five years through FY25, as per an agriculture ministry report.
- Where
- Across multiple states in India.
- Why
- The article does not provide a definitive reason for the defaults, but it outlines measures to prevent future delays in claim settlements.
States
Farmers
Financial Responsibility
States
States are responsible for contributing to the premium share.
Farmers
Delays in payment lead to outstanding dues and affect claim settlements.
- Total Default Amount
- Over Rs 6,450 crore
- Scheme Name
- Pradhan Mantri Fasal Bima Yojana (PMFBY)
- Farmers Enrolled (2024-25)
- 4.19 crore
- Claim Payout Ratio
- Rs 500 per Rs 100 premium (approx.)
- Centre's Expenditure (FY25)
- Rs 15,864 crore