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Climate Change

GRAPHIC: Billions in crop insurance payouts can be linked to climate change, EWG report says

By Amanda Perez Pintado, Investigate Midwest/Report for America | February 3, 2022
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Nearly two-thirds of federal crop insurance payments between 1995 to 2020 were paid out for damage from drought and excess moisture, according to an analysis of U.S. Department of Agriculture data by the Environmental Working Group, a nonprofit advocacy organization.

During that period, farmers received about $143.5 billion in indemnities, including $48.6 billion for drought and $38.9 billion for excess moisture, precipitation and rain. 

"Many crop insurance causes of loss result from adverse weather, which is made worse by the climate emergency," EWG said in its new report. "So insurance losses are also directly tied to climate change. As extreme weather has become more frequent, the climate crisis has already increased insurance payments and premium subsidies."

A 2019 USDA report projected climate change would increase the cost of the crop insurance program, as well.

Extreme weather has already battered the Midwest. For instance, in Illinois, the number of days with at least 2 inches of rain has increased about 40% over the last century, according to the state’s 2021 climate assessment.

[Read more: Fertilizer washes off Midwest farm fields and taints communities’ drinking water, poisons Gulf of Mexico]

The federal crop insurance program, created in 1938, allows farmers to buy insurance coverage against losses from weather. The federal government subsidizes the premiums farmers pay for the insurance policies. 

Over time, according to the group’s crop insurance database, insurance indemnities for drought and excess moisture have steadily increased. In the case of drought, the group said, indemnities rose from $325.6 million in 1995 to $1.65 billion in 2020, an increase of more than 400%.

Amanda Pérez Pintado is a corps member with Report for America, a national service program that places journalists into local newsrooms.

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