President Obama signed the Agriculture Act of 2014, or the
Farm Bill, just over a year ago on February 7. It contained some very important
legislation to farmers and the citizens who rely on their produce. As crop
insurance agent, Elvin Anderson, put it, “Had we not had that safety net, it
might be difficult for you to walk to the supermarket and pick up that loaf of
bread.” That “safety net” he refers to is crop insurance.
Before the
significance of the crop insurance portion of the bill can be understood, crop
insurance itself should be briefly described. Crop insurance protects farmers
from the loss of revenue from the destruction of their crops due to natural
disasters, disease, or wildlife. It also protects from a decline in price. It uses the projected worth of commodities to
create a fair price that farmers may purchase policies at to hold that price
for their crops. If, for any approved reason, those crops should lose that
value, the farmers will be compensated for the loss (Langstraat).
This new “farm
bill” provided many changes to the crop insurance program, which the United
States Department of Agriculture (USDA) claimed “strengthens crop insurance by
providing more risk management options for farmers and ranchers and by making
crop insurance more affordable for beginning farmers.” To do this, the Price
Loss Coverage (PLC) and the Agriculture Risk Protection (ARC) programs were
implemented. The programs are meant to supplement private insurance policies to
protect farmers when a price drop is experienced for multiple years. They are
also meant to help the farmer meet the deductible of their crop insurance.
Along with the two new programs, many more products were added to the list of
covered crops. As the main factor in the “safety net,” it is important for crop
insurance to cover a variety of farms and farmers (Langstraat).
To assist
in the wide range of coverage required by the diversity of agriculture in the
U.S., the Whole-Farm Policy was also introduced in 2014. It is meant to more
effectively cover highly diversified farms and farms selling 3-5 commodities to
wholesale markets under one policy. By purchasing this policy, a farmer may now
cover all of the crops on their farm, including specialty crops (United States
Department of Agriculture). This allows for even more coverage to be extended
to farmers.
It is seen
how important agriculture is to America through the extensive legislation that
goes into protecting the industry. The population relies on farmers. In turn
the population goes to great lengths to keep them in business.
Sources:
Langstraat,
Laurie. “Just the Facts.” Crop Insurance
Keeps America Growing. National Crop Insurance Services, n.d. Web. 1 March
2015.
United States
Department of Agriculture. Risk
Management Agency. USDA, April 2014. Web. 1 March 2015.
