The agriculture industry in the U.S. has been battered by recent natural disasters. These events have damaged crops and, in some cases, completely demolished farmland in the Eastern states. Congress is now drafting new insurance regulations that would birth a new subsidy for farmers that have seen their livelihoods put at risk due to storms and other natural disasters. The insurance plan will help protect the income of farmers, but several insurance groups have voiced their opposition for the plan, arguing that it could encourage farmers to adopt risky practices.
Backing the concerns of insurers, the American Farm Bureau Federation says that the plan will benefit neither the agriculture nor insurance industries. One of the key provisions of the plan would allow farmers to receive direct payments from the government regardless of the work they put into growing. The provision has found a major opponent in the insurance industry. Insurers are not keen to pay farmers for damaged crops that may not have ever been planted in the first place.
The ultimate fate of the plan is not yet clear. Federal lawmakers are eager to change the insurance regulations governing the agriculture industry, but will have to find ways to please both farmers and insurers. The past two years have brought many natural disasters to the U.S., many of which have cost billions in damages to crops around the country. If new insurance regulations are not enacted soon, the costs of natural disaster may soon spiral out of control.
