Crop insurance buyers are seeing far fewer carriers competing for their business these days, but the 16 remaining private insurers in the market are healthy, as the United States has been spared from nationwide catastrophic farm disasters in recent years, experts in the field say.
However, cuts to federal reimbursements to insurance companies in 2008, combined with further anticipated budget reductions from the Obama administration, are causing some concern, these observers warn.
Aside from some named perils–such as crop hail–coverage for crops is provided under a public/private partnership that was arranged in 1980. Rates are set by the government, risk is shared by the government and private insurers, and insurers are reimbursed for the costs of delivering insurance.
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