Federal Insurance Program for Grain Warehouse Depositors--Issues and Information

RCED-85-39: Published: Mar 1, 1985. Publicly Released: Apr 1, 1985.

Additional Materials:

Contact:

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Pursuant to a congressional request, GAO studied issues relating to the possible establishment of a federal deposit insurance program for grain warehouses comparable to that operated for banks by the Federal Deposit Insurance Corporation (FDIC), including the costs and problems attendant to such a program, existing state and private insurance programs for grain deposits, and existing federal regulatory programs for warehouses.

GAO found that, among those who would be most affected by a similar program for the grain industry, there is limited support for such a program. GAO found that those individuals were concerned with: (1) the potentially high cost of such a program; (2) the expansion of regulatory requirements that such a program would entail; (3) uncertainty about the extent of coverage; (4) the potential that such a program would encourage unscrupulous practices in the industry; (5) the potential impact of such a program on existing state and private insurance programs; (6) whether or not such a program would be mandatory; (7) coverage limitations; (8) methods that would be used to finance and administer such a program; and (9) whether such a program would be justified. GAO estimated that, depending on program features, a deposit insurance program might cost from $41 million to $71 million annually, which would equate to from 0.5 to 0.7 cent per bushel of grain marketed. In addition, GAO found that: (1) the only provisions for financial compensation for depositors were several state indemnity funds, private insurance policies and, in 29 states, state bonding requirements for grain warehouses and merchandisers; (2) state bonding requirements and indemnity funds differed significantly between states; and (3) very little private insurance was available to grain depositors.

Sep 16, 2020

Sep 14, 2020

Aug 10, 2020

May 7, 2020

Apr 13, 2020

Dec 23, 2019

Dec 6, 2019

Nov 12, 2019

Oct 28, 2019

Sep 9, 2019

Looking for more? Browse all our products here