ABSTRACT

Federal Crop Insurance Program (FCIP): Limits on Administrative and Operating Subsidies [August 10, 2022]   [open pdf - 588KB]

From the Document: "The federal crop insurance program (FCIP) offers farmers the opportunity to purchase insurance coverage against financial losses caused by a wide variety of perils, including certain adverse growing and market conditions. The federal government regulates the policies offered and subsidizes the premiums that farmers pay in order to encourage farmer participation in the program. The FCIP plays a prominent role in helping farmers manage financial risk, with more than 444 million acres and $150 billion in crop and livestock value insured in crop year 2021. Annual federal program outlays averaged $9.1 billion for FY2012-FY2021, adjusting for inflation. The U.S. Department of Agriculture (USDA) does not sell FCIP policies to farmers directly. Private sector companies--referred to as Approved Insurance Providers (AIPs)--sell and service FCIP policies under two annual agreements with USDA: the Standard Reinsurance Agreement (SRA) and the Livestock Price Reinsurance Agreement (LPRA). USDA provides subsidies to the AIPs to compensate for the cost of selling and servicing FCIP policies, as per the terms specified in the SRA and LPRA."

Report Number:
CRS In Focus, IF12189
Author:
Publisher:
Date:
2022-08-10
Copyright:
Public Domain
Retrieved From:
Congressional Research Service: https://crsreports.congress.gov/
Format:
pdf
Media Type:
application/pdf
URL:
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