U.S. Crop Insurance Indemnities Clear $17.3 Billion

June 5, 2013 03:36 AM

Via a special arrangement with Informa Economics, Inc.

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Level of record payouts on 2012 crops continues to edge higher.

Indemnities paid on 2012 crops have reached $17.316 billion under the federal crop insurance program as of June 3, according to Risk Management Agency data.

The pace of increase has clearly slowed in recent weeks as remainders of 2012-crop data trickle into the system. And the slow rise in payouts has kept the loss ratio for the program overall at 1.56 for three weeks in a row. The 2012 crop year is the first since 2002 where the loss ratio has been over 1.0 for the program.

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As for 2013 crops, USDA reported that 90.772 million net acres are insured, actually behind the year-ago pace for 2012 crops which stood at 91.984 million acres.

COMMENTS: In 2012, the prior record payout year, indemnities rose just under 1 percent from this point a year-ago to the current level of $10.855 billion. If that holds true this year, indemnities for 2012 crops are not likely to rise much more - only around $121 million which would take total indemnities to $17.437 billion.

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