Some critics have called crop insurance “corporate welfare.” Is this a valid criticism?

No. In fact, it is an allegation that attempts to paint two words in a negative light.

First, the term “corporate.” Crop insurance was designed by Congress to protect individual farmers and the public — not corporations — from the risks of natural disaster or volatile market fluctuations. Crop insurance, by law, must be sold to all farmers, of all sizes and all risk profiles, of which only four percent are structured as corporate entities. While crop insurance is sold and serviced by insurance companies, the primary beneficiaries in the event of a loss are family farmers and farm partnerships, not corporations.

Second, the term “welfare.” Farmers must first purchase crop insurance before being protected. In fact, since 2000, farmers have spent almost $45 billion out of their own pockets to purchase crop insurance. Crop insurance is not free, and it is not an entitlement. As former Senate Agriculture Chairwoman, Debbie Stabenow (D-MI), noted during the 2014 Farm Bill process, “Crop insurance is insurance. The farmer gets a bill, not a check.”