India’s farmers increasingly use crop insurance as a risk mitigation tool against climate change impacts, but adoption rates and benefits vary widely across states, with challenges in coverage and payouts especially in climate-vulnerable regions.

State-wise Insurance Usage

Insurance penetration differs by state, with higher rates in states like Maharashtra, Haryana, Tamil Nadu, Chhattisgarh, and Andhra Pradesh. Maharashtra, Odisha, Meghalaya, Puducherry, and Jharkhand now require farmers to pay only a nominal premium, substantially improving access. However, overall adoption remains below 10% nationwide, especially among smallholders and marginalized communities.

State	2019-20	2020-21	2021-22	2022-23	2023-24
Chhattisgarh	4,017,118	5,158,351	5,838,755	7,730,260	8,124,956
Andhra Pradesh	2,788,373	–	–	12,563,699	12,901,749
Haryana	–	1,710,601	1,650,558	1,452,842	1,446,631
Assam	1,006,212	1,660,076	996,027	489,983	795,553
Rajasthan	Detailed district-level data available

Impact of Climate Change

Climate change has led to increasing extreme weather events, affecting over 4 million hectares just in 2024, nearly double the affected area from the previous year. Crop insurance schemes such as PMFBY (Pradhan Mantri Fasal Bima Yojana) and RWBCIS (Restructured Weather-Based Crop Insurance Scheme) aim to provide financial support during climate-induced losses, but in vulnerable districts, farmers often face higher premiums and receive lower payouts.

Program Challenges and Developments

• Many climate-vulnerable districts (like Mandsaur, MP) report lower cover and delayed or denied payouts, undermining scheme effectiveness.
• States subsidize or cover premiums to expand access, with government sharing the financial burden.
• New digital platforms (e.g. SARATHI) aim to reduce the insurance coverage gap by making products more accessible to rural farmers.
• Crop insurance is linked to farmer resilience, yet the benefit is lower in high-risk regions without further policy improvements.

Key Takeaways

• Crop insurance use is growing but remains uneven, with implementation and impact closely tied to state policy and climate vulnerability.
• Climate change has magnified risks, highlighting the urgent need for improved insurance uptake and efficiency across India’s states.
• Government and tech-led initiatives are evolving to address these gaps, but significant challenges persist for India’s most vulnerable farmers.