News

Congress is looking at crop insurance costs

The Congressional Budget Office says taxpayers could save 19 billion dollars in ten years by considering four cost-reducing options in the crop insurance program. They suggest looking at restrictions on how losses are quantified, reducing premium subsidies, cutting reimbursements for private insurers for administrative and operating costs, and changing the terms of risk sharing between the government and the private insurance companies that write the policies.

In a report issued Wednesday, the CBO says about one-fifth of crop insurance costs are paid by the producer through premiums, while four-fifths is paid by the federal government through premium subsidies.  The government paid five billion in 2016 and an average of nine billion dollars annually during the past five years.

Corn, soybeans, wheat, and cotton account for nearly 75% of crops covered by federal crop insurance programs.