WASHINGTON, Nov. 20, 2012 – As more farmers complete harvest and finalize their crop insurance claims, the number of indemnity payments exceeded $5 billion and continues to climb.
The USDA Risk Management Agency’s Summary of Business Report on Nov. 19 shows that farmers have received slightly more than $5.7 billion to cover crop losses this year.
While crop insurance can be purchased to protect 128 different crops, the top five crops that suffered the most damage from the 2012 drought are corn, wheat, cotton, soybeans and grain sorghum, according to the National Crop Insurance Services (NCIS). About 15,000 crop insurance agents and 5,000 loss adjusters are working around the clock to help farmers get their claims processed, NCIS points out.
The 2012 drought impacted growers in many states across the nation’s mid-section and indemnity payments are projected to substantially exceed last year’s record of almost $11 billion in indemnities.
“We will probably see indemnity payments around $20 billion this year,” noted USDA’s Chief Economist Joe Glauber during a recent speech to the U.S. Grains Council. That amount represents a “huge injection of cash into the sector that will help compensate for the losses that we have seen on the crop side,” he noted.
Thus far, the largest crop insurance payouts have gone to Kansas farmers, with indemnities of $700,649,538 covering 18,151,809 acres.
South Dakota farmers have received $609,003,386 on policies covering 14,933,965 acres, while Iowa farmers have been paid $522,789,865 on 21,665,627 acres.
Farmers in Illinois have received the fourth largest amount of indemnities to date at $483,983,640, followed by Nebraska with $484,823,642 in indemnity payments.
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