Crop-insurance losses in 2012 due to drought conditions amountto a record $14.2 billion, and are continuing to climb, industryofficials were told Wednesday.

However, the total losses will still be less than the $16billion projected by the Congressional Budget Office last summer,industry officials say.

And the CBO is now projecting total indemnities, and thetaxpayer-funded portion of those losses, will be much lower thancrop-insurance critics warned about over the summer

The comments on the current loss outlook were made by TomZacharias, president of National Crop Insurance Services, a tradeassociation representing crop insurers, at the annual meeting ofNCIS and the American Association of Crop Insurers, now underway inIndian Wells, Calif.

“This stands in sharp contrast to the wild claims made lastsummer by crop-insurance opponents who were angling to weakenfarmers' most important risk-management tool,” Zachariassays. He adds that academics and think tanks with ananti-farm-policy agenda supplied the media with sloppy estimatesranging from more than $20 billion to $40 billion in totalindemnities.

“Critics also led people to believe that taxpayers would be onthe hook for nearly all crop insurance payments to farmers, whichis another fallacy,” Zacharias said.

He said final program costs for 2012 will reflect the $4.1billion in premiums farmers paid to purchase insurance policies,losses by private crop insurance companies, as well as governmentinvestment.

“The ability of the crop-insurance industry to sustainback-to-back insured losses exceeding $10 billion, as it has donein 2011 and 2012, is a testament to the sound financialunderpinning of the public-private partnership,” Zachariassays.

In 2011, losses of $10.8 billion covered flooding in the Midwestand drought losses in the Southern Plains.

“More importantly, unlike natural disasters before theemergence of crop insurance, all of the cost is not falling on thelaps of taxpayers,” Zacharias concludes.