WASHINGTON (Reuters) – U.S. taxpayers could pay a record $15 billion to subsidize the privately run crop insurance program this year, double the recent cost due to devastating drought in the Farm Belt, say an array of agricultural economists.
The program's runaway costs are in focus as Congress looks for ways to cut government spending, making crop insurance a bigger target for reforms.
The government and industry said they prefer to wait until late fall, when harvest is ending, to estimate costs. As of Monday, $2.6 billion has been paid in 2012 crop indemnities.
When lawmakers return to Washington next month, they must tackle both the farm bill, which includes crop insurance, and broad spending cuts required to rein in the U.S. deficit.
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