Bloomberg News

U.S. Farms Got $1 Million in Insurance Subsidies, Group Says

May 31, 2012

Crop-insurance premiums exceeding $1 million were paid out to each of more than two dozen U.S. farm operations last year, according to an analysis by a group that is asking Congress to reduce subsidies to growers.

More than 10,000 policyholders received insurance-premium subsidies of at least $100,000, the Washington-based Environmental Working Group said today in a statement. The EWG said its conclusions were based on records obtained in response to a Freedom of Information Act request. Names of policyholders weren’t available, as Congress has barred the U.S. Department of Agriculture from disclosing that information.

“The eye-opening analysis shows crop insurance is not only very expensive, but also very, very generous to large and highly profitable businesses,” Craig Cox, the group’s vice president of agriculture and natural resources, said in a statement. “Now the public needs to know who they are.”

The Senate Agriculture Committee this month approved a five-year farm bill that would add a new insurance program to help compensate growers of major crops for expected reductions in other subsidies. Crop and revenue insurance is now the government’s primary support for farm income, the Environmental Working Group said in earlier report. Taxpayers paid out $7.4 billion to lower the premiums farmers paid for insurance in 2011, more than quadruple the $1.5 billion in 2002, it said.

Secret Subsidies

“Taxpayers don’t know who is getting the money,” Ken Cook, the group’s president, said today. He called on Senate Agriculture Committee members to “lift the veil of secrecy” before the full Senate takes up the farm bill next month.

Companies that administer the crop-insurance program include San Francisco-based Wells Fargo & Co. (WFC:US) and Ace Ltd. (ACE:US), which has its headquarters in Zurich.

Messages left with the office of Senator Debbie Stabenow, the chairwoman of the Senate Agriculture Committee, and the U.S. Department of Agriculture seeking comment weren’t returned.

According to the report released today, a single farm business in Florida received $1.9 million in subsidies to insure tomato and pepper crops in five counties. It also highlighted an operation in Minnesota that received $1.7 million in subsidies to insure corn and soybean crops.

Premium subsidies went to 486,867 policyholders last year, when the cost of the program exceeded $11 billion, a record, with most of the benefits going to large farming operations, according to the Environmental Working Group analysis. Companies that administer the

To contact the reporter on this story: William McQuillen in Washington at bmcquillen@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net


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Companies Mentioned

  • WFC
    (Wells Fargo & Co)
    • $53.36 USD
    • 0.12
    • 0.22%
  • ACE
    (ACE Ltd)
    • $107.0 USD
    • -0.39
    • -0.36%
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