Cutting Crop Insurance for Big Farms Would Hurt Small Farmers Too

America’s largest farms are far less risky than smaller operations and typically have fewer crop insurance claims, according to a new working paper from top agricultural economists. And proposals to exclude those farms from crop insurance could drive up costs for small farmers. The study comes as Congress takes up debate on the future of America’s farm policy.In crop insurance, farmers pay significant premiums for insurance coverage that is delivered by the private sector. Those premiums are discounted to encourage more farmers to participate, which reduces taxpayers’ exposure to costly disasters. The resulting insurance coverage kicks in only if there is a loss – weather disaster or sharp price declines – and only after farmers shoulder a deductible of at least 25%.