The National Agricultural Insurance Scheme (NAIS), also called Rashtriya Krishi Bima Yojana, was India’s main crop insurance scheme from the Rabi season of 1999-2000 until it was replaced by the Pradhan Mantri Fasal Bima Yojana (PMFBY) from Kharif 2016. It insured farmers against yield loss from natural calamities, pests and diseases on an area approach, covered loanee farmers compulsorily and non-loanee farmers voluntarily, and was implemented by the Agriculture Insurance Company of India (AIC).
Background
- NAIS replaced the Comprehensive Crop Insurance Scheme (CCIS, 1985), which had covered only loanee farmers and a few crops.
- It was implemented first by the General Insurance Corporation of India and, from 2003, by the Agriculture Insurance Company of India Ltd (AIC), set up in December 2002 under the Ministry of Agriculture and Farmers Welfare.
Objectives
- Financial protection to farmers against crop loss from natural calamities, pests and diseases.
- Encourage farmers to adopt progressive practices, high-value inputs and better technology.
- Stabilise farm incomes, particularly in disaster years, and keep credit flowing by insuring crop loans.
A clean PDF of this page with the C4S header — it opens right away, and the link comes to your WhatsApp too.
Coverage
Recording outNABARD Grade A 2026: 45-Day Final Revision Plan + Daily TargetsWatch the recording →- Crops: food crops (cereals, millets, pulses), oilseeds, and annual commercial and horticultural crops – sugarcane, cotton, potato, and others notified by states.
- Farmers: all farmers, including sharecroppers and tenant farmers; loanee farmers (those with seasonal agricultural operations loans) were covered compulsorily and non-loanee farmers voluntarily.
- Risks: yield loss from drought, flood, cyclone, hailstorm, landslide, pests and diseases, fire and lightning; excluded losses from war, nuclear risks, malicious damage, negligence and post-harvest losses.
How It Worked
- Area approach: the insured unit was a notified area (block, mandal or gram panchayat); if the actual yield measured through crop-cutting experiments fell below the threshold yield, all insured farmers in the unit received a claim.
- Indemnity levels: 60, 80 or 90 per cent of threshold yield depending on the risk classification of the area.
- Premium: flat rates of 1.5 to 3.5 per cent of the sum insured for food crops and oilseeds (or actuarial rates if lower), and actuarial rates for commercial and horticultural crops.
- Subsidy: 50 per cent premium subsidy for small and marginal farmers, shared equally by the Centre and the state, to be phased out over time; claims beyond the premium collected were shared 50:50 by the Centre and the state.
- Claims were paid to the farmer’s bank account through the financing bank.
From NAIS to MNAIS and PMFBY
- Modified NAIS (MNAIS) was piloted from Rabi 2010-11 with actuarial premiums, village-level units for major crops, and coverage of prevented sowing and post-harvest losses.
- In 2013 MNAIS, the Weather Based Crop Insurance Scheme and the Coconut Palm Insurance Scheme were merged into the National Crop Insurance Programme (NCIP).
- From Kharif 2016, NAIS and MNAIS were replaced by PMFBY, with a uniform farmer premium of 2 per cent (Kharif), 1.5 per cent (Rabi) and 5 per cent (commercial and horticultural crops), full sum insured, and technology-based loss assessment.
Important Facts for Examsmost asked
- NAIS launched Rabi 1999-2000; replaced CCIS (1985); implementing agency AIC (from 2003).
- Area approach; loanee farmers compulsory, non-loanee voluntary; indemnity levels 60/80/90 per cent.
- Premium 1.5-3.5 per cent for food crops and oilseeds; 50 per cent subsidy for small and marginal farmers.
- MNAIS pilot Rabi 2010-11; NCIP 2013; replaced by PMFBY from Kharif 2016.
FAQs
Why was NAIS replaced?
High premium rates for commercial crops, capping of sum insured, slow claim settlement and the large-area unit made it unattractive; PMFBY lowered farmer premiums and used technology for faster settlement.
Is NAIS still in operation?
No. It was discontinued from Kharif 2016; PMFBY and the Restructured Weather Based Crop Insurance Scheme are the current schemes.
Why is NAIS important for NABARD Grade A?
Crop insurance history – CCIS, NAIS, MNAIS, NCIP, PMFBY – is a standard ARD topic and the sequence of schemes is a frequent question.
