WASHINGTON D.C. (WTAQ) - Two U.S. House members from Wisconsin introduced a reform plan Wednesday for crop insurance.
La Crosse Democrat Ron Kind and Fond du Lac Republican Tom Petri said they would introduce their proposal as an amendment to the next five-year bill once it gets to the House floor.
Farmers currently buy crop insurance from private companies, but the federal government subsidizes the premiums, covers losses over certain amounts, and guarantees certain profit levels.
Kind says he and Petri want a cap on those federal expenses, and make farmers and insurers pay for more of the risk of planting.
The Federal Crop Insurance Corporation said a record $17 billion in claims were filed for last year, due mainly to the drought.
Many farmers have pushed for expanded insurance, which they say is more predictable than the disaster aid that Congress needs to approve.
Kind says expanding insurance is not the answer, because half the settlement payments go to 10 percent of farmers.
The Kind-Petri measure would also reduce guaranteed crop profits from 14 percent to 12, and put limits on the federal obligation to cover insurers’ administrative and operating costs.