{"id":352577,"date":"2017-06-02T17:40:31","date_gmt":"2017-06-02T22:40:31","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/consumer\/insurance\/crop-insurance.html"},"modified":"2024-03-19T23:52:26","modified_gmt":"2024-03-20T04:52:26","slug":"crop-insurance","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/consumer\/insurance\/crop-insurance.html","title":{"rendered":"Crop Insurance"},"content":{"rendered":"\n
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Crop Insurance<\/h1>\n
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\n By FindLaw Staff<\/a> | Legally reviewed by Melissa Bender, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

Working the land as a farmer or rancher is challenging and rewarding. But growers and ranchers contend with a unique set of risks. Events outside their control could cause a drop in revenue or a crop to fail.<\/p>\r\n

How do farmers engage in risk protection? What risk management tools do they employ to provide a safety net? Read on to learn more about the protections offered by crop insurance coverage.<\/p>\r\n

What Is Crop Insurance?<\/h2>\r\n

Crop insurance<\/a> is an important risk management tool for farmers and ranchers. It helps protect them against declines in revenue or crop yields. There are two categories of crop insurance \u2014 federally subsidized multiple-peril crop insurance (MPCI) and state-regulated private crop insurance.<\/p>\r\n

History of Crop Insurance<\/h2>\r\n

Crop insurance options are available in the private insurance sector and through the federal government. Various insurance providers are available for agricultural producers and farming operations.<\/p>\r\n

Congress first authorized crop insurance<\/a> in the 1930s. It was an attempt to help agriculture recover from the devastation caused by the Great Depression and the Dust Bowl. Congress created the Federal Crop Insurance Corp.<\/a> (FCIC) in 1938 to carry out this program.<\/p>\r\n

Since its inception, the United States Department of Agriculture’s Federal Crop Insurance Program evolved into a critical federal support program for American agricultural producers.<\/p>\r\n

In 1980, Congress passed the Federal Crop Insurance Act of 1980. This legislation expanded the program. It allowed private insurance companies to sell crop insurance. There are several coverage options to choose from.<\/p>\r\n

In the 1980s and 1990s, droughts and other catastrophic weather events wreaked havoc. They significantly impacted several types of agricultural production. In response, Congress passed the Federal Crop Insurance Reform Act of 1994<\/a>. Congress intended that the federally regulated crop insurance program would shelter taxpayers.<\/p>\r\n

In the years that followed, federal crop insurance programs evolved. For example, in 1994, Congress required participation in the federal insurance program. It was mandatory. Congress repealed this requirement in 1996. Then, in 2000, Congress expanded the role of the private sector. It allowed entities to participate in the research and development of new insurance products and features.<\/p>\r\n

The 2014 Farm Bill<\/a> substantially strengthened crop insurance. It added new products and options for farmers and ranchers. This bill also introduced Beginning Farmer and Rancher Benefits<\/a>. These benefits make crop insurance more affordable for new farmers.<\/p>\r\n

Federal Crop Insurance Program<\/h2>\r\n

Multi-peril crop insurance (MPCI) is federally supported and regulated insurance. It helps farmers manage the risk of natural disasters. The Risk Management Agency<\/a> provides this type of insurance. MPCI protects farmers from common crop-loss causes, including:<\/p>\r\n