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GAO-23-106228 1 (2023-02-16)

handle is hein.gao/gaoogt0001 and id is 1 raw text is: The Big Picture What GAO's Work Shows The federal crop insurance program offers subs crop insurance to protect farmers against financ losses from crop price declines and poor harves due to natural causes. According to the U.S. Department of Agriculture (USDA), in 2022 the program supported about 1.2 million policies th covered 493 million acres. From 2011 through the total cost of the program was about $90 billi To implement the crop insurance program, US[ partners with private insurance companies, whi and service insurance policies to farmers. The federal government's crop insurance costs inclu (1) subsidies to pay for part of a farmer's crop insurance premium (over 60 percent in recent y and (2) compensation to the insurance compan selling and servicing crop insurance policies. Total Premium and Subsidy Dollars, and Nu of Insurance Policies 20 S16 0 12 8 2000 idized cial sts at 2021, on. In our work on the crop insurance program over the past decade, we have reviewed premium subsidies to farmers and compensation to insurance companies for selling and servicing policies. In each area, we have an open matter for congressional consideration to reduce costs, as follows. Reduce Subsidies for High-Income Participants A By statute, the program provides the same level of ch sell premium subsidies to participants, regardless of income. In contrast, some other USDA farm ide programs have statutory limits on the income participants can earn and remain eligible for ears) payments. For example, under the 2014 farm bill, ies for some farm and conservation programs are not available to individuals or legal entities whose average annual gross income (AGI) exceeds mber $900,000. Not having an AGI limit for the crop insurance program sometimes results in relatively 1.5 large subsidies for high-income participants. For example, in March 2015, we found that one participant whose AGI exceeded the limit in effect for farm and conservation programs from 2009 through 1.0 2013 received an average of $1.2 million annually in premium subsidies during those years. Participants whose AGI was less than the limit received an average of about $7,480 annually in premium -~ subsidies during the same period. 2 (ft 2005 2010 2015 Number of policies Premium subsidies 0.0 2020 2022 Total premiums Source: GAO analysis of U.S. Department of Agriculture (USDA) data. I GAO-23-106228 We also found that reducing crop insurance subsidies for participants whose AGI exceeded the limit would save millions of dollars in program costs while affecting less than 1 percent of program participants. If a provision establishing income limits is enacted, USDA has procedures from other farm programs that it could use to determine the GAO-23-106228 Crop Insurance

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