Farmers covered by federal crop insurance may not only have had their losses covered and avoided financial devastation during this year’s drought, but also might have made more money than they had predicted in March, said a University of Missouri Extension economist.
In 2012, approximately 70 percent of Missouri farm acres were revenue-protected by the Federal Crop Insurance Corporation (FCIC), Massey said. Another 13 percent had insurance based on yield protection.
“In a tough year like 2012, crop insurance is the difference between financial hardship and getting the crop into the ground next year,” said FCIC manager William J. Murphy.
Over a 10-year period in Missouri, $1.80 in federal crop insurance indemnities was paid out for every $1 paid in premium by farmers, said Ron Plain, MU Extension economist and professor of agricultural economics at MU’s College of Agriculture, Food and Natural Resources. “For the state of Missouri, it’s a good investment.”