A Colorado couple that owned two farms thought that cheating thesystem would be easy—sell some crops and claim that they were ruined by that summer'sweather. However, when the insurance policy is taken out justmonths before the supposed loss and the crops lost had nocommercial value, things may start to look a little rotten.

In February of 2004, both Bigelow Associated Farms (BAF) andJ.B. Farms (JBF), owned by husband and wife potato farmers Donald Boyd Bigelow and Janet Kerkman Bigelow,purchased crop insurance from Great American Insurance Company(GAIC). Later that year, the couple filed claims with GAIC citingweather-related losses; the two claimed they lost all of their“zero value production” potatoes, or those without any commercialvalue.

The Bigelows, however, had in fact sold some of those potatoes,as discovered through investigation by the United States Departmentof Agriculture's Office of the Inspector General with assistancefrom RMA's Central Region Compliance Office. Not all of their cropshad been destroyed as detailed in the claim.

GAIC had already made indemnity payments, including $270,607 toBAF and $307,982 to JBF, for crop losses. The insurer, however, hadnot followed proper policy and procedure; the claims had not beenadjusted correctly.

The U.S. Department of Agriculture, Federal Crop InsuranceCorporation (FCIC), and the Risk Management Agency (RMA) had allcontributed to GAIC's reimbursement. The FCIC was created byCongress, and the RMA was established to administer the FCIC. Inessence, the U.S. overpaid GAIC.

As of late July, the Bigelows have repaid the U.S. $66,000 andGAIC has paid $65,000.