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Crop Insurance Subsidies Facing Scrutiny

Crop Insurance Subsidies Facing Scrutiny


The Environmental Working Group (EWG) has released a report on crop insurance payments for individual policyholders in each state and county.  EWG notes, “In 2011, more than 10,000 individual farming operations have received federal crop insurance premium subsidies ranging from $100,000 to more than $1 million apiece. Some 26 farming operations received subsidies of $1 million or more last year.” 

EWG is asking Congress for changes to current law to allow USDA to reveal the names of the crop insurance subsidiaries, as well as the profits of the crop insurance companies.  EWG adds, “The insurance subsidies are so controversial and so lucrative to the companies that administer it that the industry’s powerful lobbyists prevailed on Congress to bar the U.S. Department of Agriculture from disclosing identities of individual policyholders who reap the benefits.”    

The National Crop Insurance Services, Crop Insurance and Reinsurance Bureau and American Association of Crop Insurers in a statement said, “(the EWG) fails to account for the fact that these ‘subsidies’ are premium discounts that are accounting transactions that take place within the USDA.  There are no government subsidy checks to farmers.  Unless indemnities are paid to a farmer, there is no outlay on that farmer’s policy.  Even when there is a loss, taxpayer cost is minimized by government underwriting gains on other policies.” 

There will be a number of crop insurance amendments when the Senate considers the farm bill.  These could include premium limits, means testing for crop insurance subsidies, and conservation compliance requirements.  

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