In the United States, calamities and disasters are frequent and unpredictable. Farmers, especially the large-scale cultivators, require a farmers crop insurance. It is essential, as they will not undergo unnecessary damages and losses once catastrophic events take place. There are two types of crop insurance. They include crop-yield insurance, and crop-revenue insurance. With the first category, it entails the total amount of yield a farmer gets into a measured piece of land. Crop is equal to revenue insurance is insurance against the produce revenue generated after a harvest.
The canola crop is a specialty crop in the United States. The generic composition of the canola crop qualifies for a premium standard as compared to other similar non-generic canola crops. Such plants need insurance as they are by far superior to their counterparts. Such insurance cover benefits both the farmer and the consumer as they both get quality produce. Many insurance companies cover for wholesome produce. It is essential that the farmers get to cover for their specific crops with unique attributes.
In the United States, a regulated federal insurance program by the Risk Management Agency is suitable for most farmers. In 1938, Congress passed the Federal Crop Insurance Act. It proved unsuccessful as there were high costs to be incurred as well as the low participation by the farmers of that time. However, in the year 1980, Congress passed a bill to upsurge the participation of farmers and to make insurance policies affordable to the farmers. It was symbolized by the overview of a public-private collaboration between the United States government and the insurance firms.
The Federal Crop Insurance Corporation is a government entity under the Risk Management Agency of the U.S Department of Agriculture. The FCIC instigates the federal crop insurance process. It also gives farmers and agricultural outlets access to crop insurance. It all started in the 1930’s during the Great Depression when farmers thought that they were safe from famine. However, during the Dust Bowl, farmers faced the full thrashing of the drought. It brought about a deficiency in produce and money as there was no food to share and sell.
President Franklin D. Roosevelt came up with the New Deal. This was a program that entails agriculture and other farm-related activities. The FCIC, through Public Law, was founded on September 26, 1980. As it was in the past, engagement in the Federal Crop Insurance Corporation was of free will. How farmers were lured into the corporation was through government subsidies on crops and fertilizers. It changed in 1994 when it was a requirement by the government to receive payments. Catastrophic coverage came to existence.
The catastrophic coverage insured the farmers from losses of up to 50 percent and over 60 percent of the crop yield. The mandatory engagement came to be in 1996. However, for the farmers who had already participated in the movement, they were to receive other benefits. Between the years 1980 and 2005, The Federal Crop Insurance Corporation has enacted close to 43.6 billion in compensations to the farmers. Three-quarters of the claims were based on drought, hailstones, and excess moisture.