Letter to the Editor: Most farmers never collect on crop insurance

[rswfarms]

Letter to the Editor in the main Iowa local paper. He does make some good points and worth the quick read. Since the crop insurance subsidy is 2.5x the amount of the Direct Payment, this is what most city people seem to hate the worst. Letter is below:

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Letter to the Editor: Most farmers never collect on crop insurance

Mar. 25, 2013 8:51 PM,

Your recent editorial, “Farmers Need to Justify Fat Insurance Subsidy” (March 17) portrayed crop insurance as a free government benefit bestowed unto farmers. Nothing could be further from the truth.

First and foremost, in order to enjoy the protection of crop insurance, farmers must first purchase it, with their own money. And farmers have been willing to do so, spending more than $30 billion out of their own pockets to purchase the protection of crop insurance since 2000.

The majority of farmers who purchase crop insurance — even during last year’s historic drought — do not collect an indemnity. In fact, Iowa farmers purchased more than 107,000 policies last year, costing them about $400 million, yet less than 48,000 of those policies were indemnified.

Crop insurance is a risk management tool, supported by Congress, to minimize taxpayer risk exposure and speed assistance to farmers when they suffer loss. Private insurers help shoulder the loss in bad years and have a sophisticated infrastructure to deliver assistance to farmers when they need it most.

Crop insurance is one of the chief reasons why farmers have been able to recover from the back-to-back natural disasters they experienced in 2011 and 2012, ensuring the vitality of rural America.

—Jeff Spellman, Woodward

[old man]

Over the years, we have paid more premiums that we have ever collected in crop insurance

[rswfarms]

Yes old man, I too have paid much more money in to crop insurance than I have recieved back. This is how most insurance is whether it is car, home, or crop insurance.

[BA Deere]

It depends on what part of the country that you farm if crop insurance does you any good, I can`t recall the last claim I`ve had and then it didn`t even match the premium paid.  Crop ins is a intregal part of the "cheap food policy", we would NOT be talking about "97-100 million corn acres" if there wasn`t a affordable crop ins available.  It makes flood-plain riverbottom and gravel pits that yield a harvestable crop 2 yrs out of 5 enticing to farm. If the gov got out of the ins business, good land would be worth more, grain would be higher and banks wouldn`t be as liberal with their lending.  If I was a city boy, I`d insist that crop insurance was kept in place, it`s a tremendous bang for the taxpayer/consumer buck.

[rswfarms]

Excellent post BADEERE, you really hit the nail on the head with your post and I agree with it a 100%!!!!!

[Faust100F]

Isn't Woodward where one of our mental institutions located?  Has anyone checked to see if Jeff has gone missing. John

[old man]

Insurance should be for a total disaster that would wipe a person out completely.

[old man]

You will never get our politicians to admit that this country has a "Cheap food policy". If not for this, we would have much higher food prices because disasters will wipe out many farmers

[kraft-t]

This is exactly the same argument that one could use to justify single payer health insurance. While most citizens would not be cronic beneficiaries of health insurance those that are would be covered. Medical doctors hospitals and staff would not need to over bill on paying customers to offset those that don't or can't pay. Thus in the long run it would be cheaper and would end the medical bankrupties.

Thus it would be better for america in the long run.

However, those of you that beleive in the efficiency of the private market should oppose any effort of government to subsidize crop insurance. You do beleive in pure capitalism and the survival of the fittest. If you cannot afford private crop insurance you are not one of the fittest. Get the hell out of the way and make way for the more efficient businessmen..    Tongue slightly in cheek

[rswfarms]

Yes old man, our country does have a cheap food policy. However, the absolute total farm subsidies I get in only 30 cents per bushel of corn. And that 30 cents is only 3% of our total corn revenue per acre. 3% isn't much at all in the total big picture I would.say. I would find it interesting for anyone to say that just 3% of gross revenue per acre is a large anount.