A Central Sector project namely, National Agricultural Insurance Scheme (NAIS) is being implemented in the country since Rabi 1999-2000, as a part of risk management in agriculture with the intention of providing financial support to the farmers in the event of failure of crops as a result of natural calamities, pests, and diseases. The project is available to all the farmers – loanee and non-loanee – irrespective of their size of holding. Loanee farmers are included on a compulsory basis in a notified area for notified crops whereas for non-loanee farmers scheme is voluntary.
It is a yield guarantee project operating on “Area approach” basis. The implementing States/UTs can notify any unit area of insurance i.e. block, mandal, tehsil, circle, phirka, gram panchayat etc. keeping in eye the availability of past yield data and capacity of the State to undertake a requisite number of Crop Cutting Experiments (CCEs). The State Government/UT Administration is needed to notify areas/crops well in advance of each crop season and issued the necessary notification/instructions to all financial institutes. Give past yield data and also conduct the required number of Crop Cutting Experiments (CCEs) in each notified areas for assessment of crop loss.
The project is optional for States/UTs. At current, the scheme is being implemented by the 24 States and 2 Union Territories namely Andhra Pradesh, Assam, Bihar, Chhattisgarh, Goa, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Manipur, Meghalaya, Mizoram, Orissa, Sikkim, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand, West Bengal, Andaman & Nicobar Islands and Puducherry. The project is demand driven. However, the progress of the project can be measured in terms of farmers/area covered, sum insured, premium collected, claims paid and farmers benefitted.