Bill Murphy, an administrator at the Risk Management Agency (RMA) has announced that the Federal Crop Insurance program will be undergoing some positive changes in the near future.
Murphy was present at the Big Iron Farm Show in West Fargo and spoke to the crowd about the current year’s issues as well as changes to the program. Not all of the news was good, as Murphy did need to discuss the unprecedented number of catastrophes in 2011 that left farmers hurting this year; from the overly wet soil in North Dakota to the extreme droughts in Texas.
This is Murphy’s 31st year with the Federal Crop Insurance program and he shared that this was unlike any other he had ever experienced. In fact, he said that “I think the program will be tested this year like it never has before.”
In North Dakota, in 2011 alone, there will have been a prevented plant coverage of more than 6 million acres. This will break all previous records, and Murphy anticipates that there will be approximately $1.5 billion paid to farmers strictly for that specific type of loss.
He went on to say that it is still too soon to try to calculate a total figure for the entire country, as corn and soybeans typically comprise about 65 percent of the crop insurance coverage, and those results haven’t yet occurred.
That said, he did reassure the audience by saying that the insurance industry is holding enough in reserves to be able to manage this year’s losses. Furthermore, he explained that the Federal Crop Insurance program was established in a way that it isn’t heavily influenced by any budgetary limitations.
