U.S. crop insurance companies have paid out more than $7.1 billion in claims in 2011, which makes the year second only to 2008’s $8.6 billion in the total value of indemnities paid out to farmers.
A combination of several large-scale floods in the Central U.S., record droughts in the southern plains, a strong tropical storm in the Northeast and a hard freeze in Florida combined to result in widespread agricultural losses, according to National Crop Insurance Services.
Land covered under crop insurance has been rising since 1980, when Congress passed legislation designed to increase participation in the country’s crop insurance program. By 1998, more than 180 million acres of farmland were insured under the program, representing a three-fold increase over 1988. By 2010, 80% of eligible farm land including all major grain crops and cotton, nursery, citrus, rice, potatoes and livestock, covering more than 256 million acres of farmland and valued at nearly $80 billion, were protected by private crop insurance policies.