Crop Insurance Today Second Quarter 2022 - 27

Figure 13
FCIC
10
12
14
16
18
20
22
4
6
8
0.00
2
2007 2008 2009 2010
2011
Fruits/Nuts/Trees
2012 2013 2014 2015
Nursery
2016
Vegetables
2017
2018 2019 2020
AGR/WFRP
2021
FCIC Program Growth for Specialty Crops
e
Crop Report to Congress that highlighted progress
on research and development activities related
to expanded coverage for specialty crops that
includes fruits, nuts, trees, nursery, vegetables,
and coverage under WFRP. This encompassing
report highlighted achievements and accomplishments
in addressing 2018 Farm Bill requirements,
new and ongoing research, studies,
and initiatives aimed at expansion efforts, and
overall specialty crop program improvements. In
2021, the amount of insurance for specialty crops
reached approximately $22 billion (Figure 13)
reflecting positive grower response to the overall
program enhancements. And as efforts around
the feasibility of insuring local food production
and nursery greenhouses continue, in addition
to more activity on expanding existing programs
and exploring new crops for development, the future
looks bright for specialty crops and organics
to see even more growth.
icy continues to account for roughly $2.2 billion
of the program's overall liability, the sixth largest
plan of insurance in the crop insurance portfolio.
The WFRP policy also was the basis for development
of a new Micro Farms policy released in
late 2021 effective for the spring 2022 crop year.
This new policy is intended to provide an insurance
option and protection for small-scale farmers
who have operations that earn an average
allowable revenue for new farmers of $100,000
or less, or for carryover insureds of $125,000 or
less. While all coverage levels will be available,
those farmers purchasing higher coverage levels
at 80 and 85 percent may do so without providing
additional paperwork. In addition, underwriting
and record keeping requirements are minimized,
there is no requirement to report expenses and
individual commodities, and post-production
revenue, like value added products or washing
Table 7
able
U.S. Crop-Hail Results, All Perils
Crop Year
2012
op Y
2013
2014
2015
2016
2017
2018
2019
2020
2021
Liabiltiy
Mil. $
39,407
39,773
39,652
36,805
36,178
35,775
36,084
35,359
35,802
40,309
Premium
Mil. $
955.8
953.2
991.7
979.7
983.3
958.8
987.3
1,019.6
1,010.0
1,167.3
Data as of April 24, 2022
Source: Adjusted Verified Totals, US only, for NCIS member companies combined with the data from non-members.
Losses
Mil. $
704.3
646.2
1,209.9
740.3
880.1
882.0
937.4
996.5
1,154.4
924.2
Loss Ratio
0.74
0.68
1.22
0.76
0.90
0.92
0.95
0.98
1.14
0.79
and packaging commodities, can be included as
revenue. It is likely to take some time for sales
to ramp up as agents become familiar with this
new program, and as a new segment of farmers
become aware of this new policy. However, this
targeted effort is just another example of the crop
insurance program adapting to cover another of
the many aspects of production agriculture.
Annually, RMA evaluates potential new areas
for expanding existing crop programs, and 2021
was no different. RMA expanded 17 existing programs
for dry beans and peas, fresh market sweet
corn and tomatoes, peanuts, grain sorghum,
corn, popcorn,
safflower,
soybeans, almonds,
blueberries, grapes, mandarins, pistachios, walnuts,
and barley into a total of 11 states and 27
counties addressing farmer requests for wider
availability of coverage.
Lastly, RMA sent an updated 2021 Specialty
U.S. Crop-Hail
Experience
Crop-Hail insurance policies insure direct
damage from hail as the primary cause of loss. In
addition to hail damage, many policy forms carry
endorsements for additional perils such wind,
fire, vandalism, and theſt.
Crop-Hail premium rose gradually over the
past 10 years, was down slightly in 2020 at $1.010
billion but bounced back to $1.28 billion in 2021.
Crop-Hail provided $40.3 billion in private insurance
protection to U.S. farmers in 2021, and
losses paid out were $924 million (Table 7).
The industry loss ratio, defined as paid losses
divided by premium written, was 0.79 in 2021,
down from 1.14 in 2020 and 0.98 in 2019.
There were six storm days that exceeded $20
million of loss in 2021. The most significant storm
occurred on July 9 causing $118 million in CropHail
losses with $95.3 million of that occurring in
Nebraska alone. Two storms in July caused more
than $144 million in damage across 22 different
states. Three storm days in August caused more
than $130 million in damage. In total, the losses
from the top 10 storm days amounted to $393
million, down significantly from $570 million
in 2020. Five states took the brunt of the major
storms, with Nebraska absorbing $164.8 million
of loss, Illinois $69.3 million, Iowa $39 million,
Minnesota $37.4, and South Dakota $31.4
million.
CROPINSURANCE TODAY®
27

Crop Insurance Today Second Quarter 2022

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