| Title XI: Crop Insurance | |||
Title XI: Crop Insurance
What it does: The federal crop insurance program, which now provides coverage for livestock and dairy producers, as well as crops, is permanently authorized, but this title can make modifications to rules or require USDA to create pilot programs. Premiums are subsidized, and private insurance companies share the risk of losses with the government. The policies provide indemnities when yields or revenue fall below guaranteed levels.
Section 508(h) of the Federal Crop Insurance Act already authorizes private companies to develop new insurance products, but they have to be actuarially sound and approved by USDA.
What it costs: $101 billion, or 7%, of the projected 10-year cost of farm bill programs through 2033.
What’s in play: The program continues to grow significantly because of new products that have been especially attractive to livestock and dairy producers. However, producers of specialty crops, defined in law as “fruits and vegetables, tree nuts, dried fruits and horticulture and nursery crops, including floriculture,” are lobbying Congress for rules changes to address a variety of issues that limit participation in many areas. Among the issues is how to cover crops for which there is little publicly available data.
There also are pending proposals to fix specific concerns with coverage for wheat, wine grapes and other crops.
Some lawmakers are pushing ideas for tying crop insurance more closely to climate concerns. A bipartisan proposal, the COVER Act, would revive a $5-per-acre premium subsidy program for growers who plant cover crops. USDA offered the payments in 2020 and 2021, using pandemic funding.
Policymakers and farm groups continue to wrestle with ideas for making the Whole Farm Revenue Protection program more appealing to farmers, and to insurance agents who are often reluctant to market the complex product. Whole Farm was designed to appeal to diversified operations and specialty crop producers, but participation has been disappointing. USDA doubled the annual coverage limit to $17 million, but some specialty crop producers say that’s not high enough.
Notable marker bills
S.1690, H.R.3478 — COVER Act of 2023, led by Sen. Sherrod Brown, D-Ohio, in the Senate and Rep. Sean Casten, D-Ill., in the House would provide premium subsidies for cover crops, with mandatory funding starting at $60 million a year.
H.R.1840, S.1016 — The Agriculture Resilience Act of 2023, led by Chellie Pingree, D-Maine, and Sen. Martin Heinrich, D-N.M., would make broad changes to commodity, crop insurance, research and other programs to address the impact of climate change. USDA would be authorized to offer performance-based insurance discounts for practices that reduce risk of damage from climate-related disasters.
S.1539 — American Prairie Conservation Act, led by Sen. John Thune, R-S.D., would reduce crop insurance coverage nationwide for new cropland converted from native sod. The restriction is now limited to the Prairie Pothole region.
S.2104 — Sen. Roger Marshall, R-Kan., proposal to allow for the separation of enterprise units by continuous and fallow cropping systems, an issue for wheat growers.
S.1816 — Proposal by Sen. John Fetterman, D-Pa., to require research and development of an insurance policy for mushrooms.
S.2134 — Proposal by Sen. Alex Padilla, D-Calif., to require research and development of an insurance policy for wine grape losses due to smoke exposure.
