Ag Policy Blog

Setting the stage for plans to boost crop insurance, Sen. John Hoeven, R-N.D., reintroduced a bill with several key senators – the Federal Agriculture Risk Management Enhancement and Resilience (FARMER) Act.

Somewhere a young Senate staffer achieved a certain level of legendary status among fellow Hill staffers just for creating the FARMER Act acronym.

The FARMER Act increases premium support for higher levels of crop insurance coverage, which the senators stated would "enhance affordability and reduce the need for ad-hoc disaster assistance."

Taxpayer support for Enterprise units insurance and Whole Farm insurance would increase from 68% to 77% for producers buying 80% coverage levels. For 85% coverage levels, the premium support would increase from 53% to 68%.

The bill also would increase the premium support and coverage levels for the Supplemental Coverage Option (SCO) as well, increasing from 65% to 80%. The SCO coverage level also would increase from 86% to 90%. Another provision in the bill would direct the Risk Management Agency to examine ways to improve the effectiveness of SCO coverage.

One interesting caveat is that the bill would not require producers to choose between signing up for Agriculture Risk Coverage or Price Loss Coverage (ARC and PLC) when looking at purchasing enhanced crop insurance coverage, "giving them the flexibility to make decisions that work best for their operations."

SCO had been essentially created to give producers a choice to pay for higher bands of coverage levels if they opted to sign up for PLC for their crop over ARC. The main rationale for that decision was that ARC and SCO provide such similar band widths of protection. Under the bill, a producer could sign up for ARC, but still also buy SCO coverage as well.

The bill will get some attention as lawmakers now look to add commodity and crop insurance improvements into the budget reconciliation bill.

The bill is co-sponsored by Senate Agriculture Committee Chairman John Boozman, R-Ark., along with Sens. Mitch McConnell of Kentucky, Chuck Grassley and Joni Ernst of Iowa, Cindy Hyde-Smith of Mississippi, Jerry Moran and Roger Marshall of Kansas, Jim Justice of West Virginia and Deb Fischer of Nebraska.

Several major farm groups also endorsed the bill as well.

Also see, "House Ag Chair Plans to Boost Farmer Safety Net in Budget Reconciliation Bill," https://www.dtnpf.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

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