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ExpectMore.govExpectMore.gov home pageEXPECT FEDERAL PROGRAMS TO PERFORM WELL, AND BETTER EVERY YEAR.
 
Program Assessment

Program

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Federal Crop Insurance

Crop insurance is available for many commodities and specialty crops. Farmers buy it at subsidized rates/premiums. USDA's Risk Management Agency provides participation incentives to private insurance companies by sharing the losses and paying some of their administrative expenses.

Rating

What This Rating Means

PERFORMING
Moderately Effective

In general, a program rated Moderately Effective has set ambitious goals and is well-managed. Moderately Effective programs likely need to improve their efficiency or address other problems in the programs' design or management in order to achieve better results.
  • The crop insurance program is valuable for agricultural producers as a risk management tool. However, there is room for changes that would make this program more effective and efficient such as reducing producer subsidies on premiums, raising the minimum coverage level, or reducing admistrative reimbursements and or underwriteing gains to the crop insurance companies.
  • There is no evidence to show that the current structure of the crop insurance program is the most cost effective way to achieve this level of risk protection for the farmer.
  • The management of this program is relatively good. It includes a close partnership with the crop insurance companies. Participation information, such as policies sold, liability, acres, and premiums are provided on a daily basis at a producer level by the companies. The data is crucial for strategic planning.

Improvement Plan

About Improvement Plans

We are taking the following actions to improve the performance of the program:

  • Achieving proposed legislative changes to make the program more effective and efficient by covering more acres at a lower subsidy cost.
  • Developing other efficiency measures that incorporate the whole taxpayer cost (administrative, indemnities, underwriting gains, premium subsidies and company reimbursements) needed to run the program.

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