The news lately has been full of suggestions that major changes are coming to the federally-reinsured crop insurance program. If the proposed cuts make it through Congress, federal support for the program will be reduced by around 36%. Needless to say, the reaction from the agribusiness world has not been particularly positive.
Whether or not major agricultural budget cuts come to fruition, one thing is reliable – when the insurance company gets cut, producers tend to be the ones who bleed. It’s been suggested that the crop insurance program will be changed to cap premium subsidies at $40,000 and to institute means testing. Means testing, in particular, has long been a refrain for politicians putting the crop insurance program on the budgetary chopping block.
In effect, farmers would be punished for success in growing their operations. Even though the trend of the last century has been towards rural population decline, even though economies of scale can make the difference between prosperity and poverty, and even though a farmer’s eyes invariably light up when he hears that the 40 next door might be going up for sale, the pressure will be on to cut coverage options for larger operations.
Farmers know that the business of agriculture is a variable one, prone to cycles of boom and bust. The politics of agriculture are no exception. If you bet the farm on having good weather, $8/bushel corn, or an insurance company that pays claims without any pushback, the consequences can be dire.
In crop insurance, as in the rest of life, you have to fight for the things you want. You fight to protect the financial integrity of the program through civic engagement, both individually and through farmers’ advocacy groups. You fight for your own crop insurance claim, and the continuation of your own farming operation, by keeping good records, by cultivating strong relationships with your agent and your adjuster, and by seeking legal advice sooner rather than later when you’re in a high risk situation.