Crop insurance bill mounting for companies, taxpayers

// News | General | Crop insurance bill mounting for companies, taxpayers
Email to a friend Plain text Print version // Font size: Decrease font Enlarge font

Claim payments to American farmers hit by the 2012 drought topped $3.5bn this week, according to the United States’ Federal Crop Insurance Corporation, journalstar.com reported on Saturday.

That includes more than $245m in compensation to Nebraska producers.

“This drought heavily affected spring-planted crops,” said Keith Collins, spokesman for National Crop Insurance Services.

By the time the dust clears, payments to holders of federally subsidized crop insurance policies are likely to go well beyond last year’s record of about $10.8bn nationally, Collins said.

He wasn’t willing to forecast a final number on behalf of his organization.

“But yes, we’ve seen estimates anywhere from $15 billion to $30bn.”

In Nebraska alone, according to federal crop insurance officials, those with a stake in crop production in 2012 bought almost 159,000 policies on about 15.6 million acres of land.

As one gauge of the level of participation, there are 18.17 million production acres in the state overall, including those where wild hay is harvested.

The total premium cost in the state of almost $667m included about $473m in taxpayer subsidies.

Two decades ago, farmers counted much more heavily on emergency disaster programs from federal lawmakers to help them survive weather extremes.

But more recently, higher subsidy rates and growing awareness about improvements in coverage, to include both yield and price protection, have made crop insurance the first line of defense against weather extremes.

In early November, Kansas is at the top of the chart in several crop insurance categories, including $448m in claims paid. One reason is that Kansas is the nation’s biggest producer of winter wheat, which is harvested earlier than spring-planted crops.

That means the pace of claim filing and paying is running ahead of Nebraska and other states farther north.

Veteran crop insurance agent Ruth Gerdes of Auburn , who insures customers in several states, said she is about 50 percent done with claims.

“Harvest was early,” she said, “and a lot of farmers have gotten their paperwork in, and we’ve been paying claims on a daily basis. So it’s flowing well.”

The taxpayer liability for the 2012 drought remains to be seen.

Collins said it would include about $6.9 billion in premium subsidies and about $1.3bn in operating costs.

“And then the question is what underwriting losses the government is going to bear.”

That question looms because the federal Treasury stands behind insurance companies to prevent them from being overwhelmed by claims exposure at times of widespread weather calamity.

Tagged : No tags for this article

Headlines Newsview all

US, Canada Condemn Kaduna Bombings

As critiscisms continued to greet Wednesday’s twin bombings in Kaduna metropolis, an Improvised Explosive Device went off at the New Road Motor Park in Kano ... Full story

Nigeria's Nkechi Opara wins first medal in women’s weightlifting at 2014 Commonwealth Games

Team Nigeria on Thursday in Glasgow recorded its first medal at the 2014 Commonwealth Games when Nkechi Opara won bronze in the women’s weightlifting 48 ... Full story

Bishop Oyedepo: Nigeria May Split Soon

Bishop David Oyedepo of the Living Faith Church aka Winners Chapel, has warned that Nigeria is on the verge of breaking up if some issues ...

Ebola epidemic gets 'Out of Control' in West Africa

The doctor leading the fight against Ebola in Sierra Leone has himself caught the disease. The epidemic has claimed the lives of more than 600 ...

Nigeria, Cameroon, Chad and Niger deploy 2,800 troops against Boko Haram

Nigeria, Cameroon, Chad and Niger have agreed to quickly form a new force that would comprise 2,800 soldiers to fight the Boko Haram insurgents. The defence ...

Nine Nigerian Students Kidnapped In The Ukrainian City Of Lugansk

Nine Nigerian students have been reportedly kidnapped in the Ukrainian city of Lugansk, according to a statement by the representative of the National Security and ...

Bomb Explosion In Kaduna Leaves Many Dead!

An explosion has occurred in central Kaduna killing at least 10 people, a witness has said. The blast occurred Wednesday afternoon along Isa Kaita road which ...

Nollywood Actress Bukky Wright’s Second Marriage Crashes

It appears that the second marriage of popular Nollywood actress, Bukky Wright with her husband, Adewale Onitiri, has crashed. Reports say the couple almost ended the ...

Boko Haram Beheads Nigerian Air Force Officer - Very Disturbing Video

A disturbing video which showed a Nigerian Naval officer identified as Umar Abubakar being interrogated and later gruesomely murdered by Boko Haram men in Borno ... Full story

Popular Nigerian Pastor Chris Okotie Shows Off N400m fleet of cars

No doubt, the ageless multi award winning pop Musician, Chris Okotie; now known as Rev. Chris Okotie is a very wealthy man; who loves seeing ... Full story

Charles Okonkwo Jr., Nigerian in New York arrested after killing brother, beating respected doctor mother into a coma

Charles Okonkwo Jr., a Long Island, New York, teenager with a history of psychiatric problems killed his 15-year old brother and brutally beat his mother ... Full story

Comment on: Crop insurance bill mounting for companies, taxpayers

Rate this article

0

Featured author

chuky01

Breaking News

Uniben Final Year Student Wins 2014 Miss Global Nigeria Pageant [Pictures]

A final year student of International Studies & Diplomacy, University of Benin, Faith Eriata is the 2014 Miss Global Nigeria Queen.The new Queen who hails ...

Jim Iyke Finally Dumps Nadia For Good, Flirts with New Mistress

Just as we thought that the rift between Ghanaian actress, Nadia Buhari and Nollywood bad boy Jim Iyke, was gradually getting settled as the duo ...

Actor Solomon Akiyesi Says Goodbye To Second Hand Cars

There is absolutely nothing wrong in buying second hand cars, but for some people, it actually means you are not capable of buying a new ...

Wizkid's Alleged 'Caro' Claims Her Account Was Hacked

Few days ago it was reported that an American based girl named Caro Ikpea called out WizKid's girlfriend Tania Omotayo. If you missed it Read ...

Why I Allowed Basketmouth Use My Name—Real Basketmouth Explains

MC Basketmouth and Basketmount BE FOR BE FOR Many may not know that Bright Okpocha, better known as Basketmouth, is not the original owner of the ...

Toke Makinwa Rocks Same Hairstyle As Beyonce

Popular Nigerian OAP, Toke Makinwa is not known to wear braids, but this time, she has decided to give it a try. She is mostly ...

I Will Bring Dider Drogba Back To Chelsea, He Belongs Here - Jose Mourinho

JOSE MOURINHO has confirmed he is trying to bring Didier Drogba back to Chelsea with a deal possible by the end of the weekend.Drogba, whose ...

Stephanie Okereke Linus Features In Hollywood Movie (SEE PHOTOS)

Stephanie announced few weeks ago that she will be featuring in a Hollywood movie. Check out some of the behind the scene photos she posted ...

I Have Diabetes—Jide Kosoko Declares

Veteran Nollywood actor, Jide Kosoko, has disclosed that he has been living with diabetes since 1996. He made this declaration at the just concluded Nigerian ...

I Once Despised Marriage, But Now I Want It--Pasuma

Fuji star, Wasiu Odetola better known as Alabi Pasuma, has disclosed that he is ready to settle down now because he initially sees marriage as ...