Record Insurance Payouts To Indiana Farmers
Indiana farmers are receiving more than 1 billion dollars in crop insurance because of last year’s drought. According to Purdue University figures released this week that’s nearly double the previous record of $522 million that was paid out in 2008. As Indiana Public Broadcasting’s Gretchen Frazee reports, those numbers will likely convince more farmers to sign up for insurance before a deadline Friday.
Purdue University agriculture economist Chris Hurt says nearly 75 percent of last year’s crop was insured. As the deadline to sign up for coverage approaches, he says he expects that number to be higher this year.
“Then secondly we expect the coverage levels that they have to also be higher. So there’s nothing like a disaster to tell people it can happen on their farm and of course, that really encourages them to think about increasing insurance levels in the following year.”
Indiana Farm Bureau Director of Farm and Crop Insurance Jim Rink says he expects about half of the farmers without insurance will buy it this year. He says now is a good time to do so because premiums are dropping.
“If you combine last year’s rate reduction with this year, we’re seeing a rate reduction of about 14 percent on corn and about 15 percent on soybeans.”
Rink says that’s because over the past several years Indiana has had a low payout rate, even though last year more than three times as much money was paid to farmers as was taken in.
What all this means for taxpayers, Rink says is complicated. On one hand, Congressional lawmakers might provide more money for the farm insurance program when they update the Farm Bill later this year. But on the other hand, the federal government might not have to pay out as much in the future as it did last year.
For Indiana Public Broadcasting, I’m Gretchen Frazee