The Ministry of Fisheries, Animal Husbandry and Dairying has rolled out an insurance programme under the Pradhan Mantri Matsya Kisan Samridhi Sah-Yojana (PM-MKSSY) to help aquaculture farmers manage financial risk from crop failure, disease outbreaks and natural disasters. The scheme addresses a critical gap: small and marginal fish farmers operate on thin margins and a single failed harvest can push them into debt. Insurance protection is meant to strengthen their ability to continue farming and invest in expansion.
India is now the world’s second-largest fish producing nation, with annual output reaching 19.8 million tonnes in 2024-25. Aquaculture accounts for over 74% of this production and provides livelihoods to more than 30 million people including farmers, traders and processors. Yet the sector remains exposed to uncontrollable risks such as disease, flooding, cyclones and pollution that can wipe out months of work.
Key facts
- Insurance premium incentive: up to 40% of the cost, paid directly to farmers through bank transfer
- Pond-based aquaculture: maximum incentive of Rs 1,00,000 for up to 4 hectares, capped at Rs 25,000 per hectare
- Advanced systems (cage culture, recirculating tanks, bio-floc): maximum incentive of Rs 1,00,000, eligible unit size up to 1,800 cubic metres
- Additional incentive: 10% bonus for Scheduled Caste, Scheduled Tribe and women farmers
- Claim settlement timeline: 30 days for shrimp farming, 45 days for other aquaculture types
- Current insurers: OICL, AICL, NIAL, UIIC; private insurers being onboarded
- Progress so far: 127 applications approved covering 321.74 hectares with Rs 40.03 lakh disbursed
What the scheme covers
PM-MKSSY’s insurance component was approved on 8 February 2024 and is delivered through the National Fisheries Digital Platform. The scheme does not prevent losses but protects farmers from severe financial distress when covered events occur. Eligible losses include disease outbreaks, summer kill (unexpected fish death from low oxygen), pollution, earthquakes, cyclones and floods.
The core feature is a one-time monetary incentive given to farmers to reduce the upfront cost of buying an insurance policy for one crop cycle. This incentive is transferred directly to eligible farmers’ bank accounts, eliminating the need for them to pay the full premium themselves.
Who can benefit
Any aquaculture farmer engaged in pond-based farming or modern systems like cage culture, recirculating aquaculture systems (RAS), bio-floc technology and raceways is eligible. Farmers with less than one hectare of water spread area receive proportional incentive. Scheduled Caste, Scheduled Tribe and women farmers receive an additional 10% incentive on top of the standard 40% support, making the total subsidy higher for these groups.
How to claim
When an insured loss occurs, the farmer must immediately notify the insurance company. The insurer then appoints a loss assessor to evaluate the damage. The farmer submits documentary evidence as required by the policy terms. Based on the assessor’s report, the claim is processed and payment is made to the farmer’s account with periodic updates through the insurer’s online portal. The entire process must be completed within 30 days for shrimp farming and 45 days for all other aquaculture activities.
Implementation status
As of the latest update, the scheme has received 316 applications covering 730.61 hectares. Of these, 127 have been approved and funds disbursed, benefiting farmers on 321.74 hectares. Total disbursement to date stands at Rs 40.03 lakh. Four government-owned insurance companies are currently offering policies, and private insurers are being invited to join to strengthen choice and coverage.
What this means for you
If you are a fish farmer, this scheme reduces your out-of-pocket insurance cost by at least 40%. This makes protection affordable and helps you recover quickly if disease or natural disaster destroys your crop. If you are a Scheduled Caste, Scheduled Tribe or woman farmer, you get an even higher subsidy. The scheme is designed to encourage you to view insurance as part of good farm management rather than an optional expense.
The government’s goal is to build a lasting insurance market for aquaculture so that over time, insurers offer more products and farmers treat risk protection as routine. For this to work, insurance companies must settle claims fairly and quickly. The 30-to-45-day settlement window is meant to ensure you are not left waiting months for payment after a loss.
What happens next
The government intends to strengthen cooperation between federal and state agencies, insurance companies and technical institutions to improve risk assessment and claim verification. Private insurers are being onboarded to expand the range of products available. Farmers are encouraged to apply through the National Fisheries Digital Platform, and disbursements will continue as applications are approved.