Discussion: The 2007 Farm Bill and Crop Insurance: Implications for Crop Producers in the South

Abstract

The crop insurance program has grown significantly since passage of the 2002 Farm Bill. Total premiums more than doubled from $2.9 billion in 2002 to $6.6 billion in 2007. This growth in the crop insurance program is due to a combination of greater participation by growers at higher levels of coverage, an increased number of crops with coverage available, and a general rise in commodity prices. Not unexpectedly, there has been a corresponding increase in the cost of program delivery. The total amount of expense subsidy and underwriting gains paid to crop insurance companies increased from around $1 billion in 2001 to over $2.5 billion in 2007.