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Crop Insurance: Participation in and Costs Associated With the Federal Program

RCED-88-171BR Published: Jul 06, 1988. Publicly Released: Jul 06, 1988.
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Highlights

In response to congressional requests, GAO reviewed the Federal Crop Insurance Corporation's (FCIC) crop insurance programs to determine: (1) the level of farmer participation in the programs; (2) why participation rates varied; and (3) insurance experts' reasons for the low participation rates and suggestions to increase the rates.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Agriculture The Secretary of Agriculture should require the Manager, FCIC, to: (1) increase the emphasis on educating farmers and insurance agents about crop insurance on a regional or state basis with priority given to areas that FCIC has already identified as likely to increase participation with more education; and (2) conduct a statistically sound, nationwide study to determine which of the major factors influencing participation could or should be addressed, and obtain information on the kinds of changes needed to achieve more participation and the costs of such changes to the government and farmers.
Closed – Implemented
FCIC has increased its educational/training activities on financial management, in response to recommendations made by the Federal Crop Insurance Commission. FCIC is working with USDA/ERS on a nationwide study that will give some incite into crop insurance participation, but the scope is limited. FCIC does not have the funds to conduct a study as GAO recommended.

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Topics

Agricultural programsFarm produceFederal corporationsInsuranceInsurance companiesLossesProgram managementCrop insuranceGrain and grain productsParticipation rates