Ranking Member of the House Agriculture Committee Collin Peterson (D-MN) warns that one of the biggest dangers to crop insurance is criticism from groups who are trying to undermine the important risk management tool through the appropriations process before the entire Farm Bill is even fully enacted. “The danger is that some of the people who are making noise about this, if they get their way, they will destroy crop insurance,” said Peters on a recent Agri-Pulse Open Mic interview with Jeff Nalley. “That’s the danger.”
Peterson notes that he has already met with crop insurance companies that are considering pulling out of the program altogether because of the ongoing attacks focusing on profit margins and the premium support offered to farmers. “I had the underwriters and reinsurance companies in my office asking me questions about where this thing is going,” and explaining that their board of directors are questioning if the company should stay in the business or not.
Peterson explains that what is most concerning is that these questions are coming from the only companies in the business who are offering national coverage. “If they get payment limitations on big farmers, that will bring this thing down,” he said. Peterson added that Congress has probably already pushed the participating crop insurance companies farther than they should have with the Standard Reinsurance Agreement (SRA) and the 2008 Farm Bill. “Hopefully we can explain to people as we fight this fight just how precarious this situation is,” he says.
Peterson says that in a worst-case scenario, we could end up with a situation where entire states can no longer get crop insurance coverage. “You could have a situation where, for example, North Dakota, for example, would not be able to get insurance,” he said. “Crop insurance is what keeps family agriculture and smaller farmers going,” noted Peterson. “It’s so expensive to farm, the banker isn’t going to finance you if you don’t have a way to pay him back, which is what crop insurance does.”
Peterson notes that crop insurance is critical to the future of family farming in the U.S. “The most important thing to keeping family farms and getting young people into agriculture is crop insurance,” he adds.
Listen to the entire interview here.