OVERLAND PARK, Kan., May 6, 2013– National Crop Insurance Services (NCIS) responded to critics of the crop insurance program after USDA reported indemnities reaching a record $17 billion for the 2012 crop year.

NCIS President Tom Zacharias said that before producers received any crop insurance indemnity payments, they had $12.7 billion in losses as part of their deductibles to crop insurance policies.

"When combined with the $4.1 billion farmers paid out of their own pockets to purchase crop insurance last year, total farmer investment neared $17 billion," said Zacharias in his editorial in Roll Call/CQ.

Zacharias highlighted that the $17 billion in indemnities are not completely borne by taxpayers, “because farmers and insurers picked up a major portion of the costs and sustained significant economic losses."

He also said that when crop insurance premiums exceed losses, the government sees underwriting gains that are meant to offset payments in bad crop years. “In fact, the government experienced nearly $4 billion in gains from 2001-2010,” he said.

Zacharias added that, because of crop insurance, Congress did not need to fund an ad hoc disaster bill “despite the historic devastation endured by our agricultural producers."


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