FARM BILL SHIFTS ALL CROP INSURANCE SALES FROM USDA TO PRIVATE AGENTS


                                            Release No. 0175.97
                                                               
                                    Tom Amontree (202) 720-4623
                                             tamontree@usda.gov
                                  Marian Jenkins (202) 720-5351
                                      mjenkins@wdc.fsa.usda.gov             
                                        


FARM BILL SHIFTS ALL CROP INSURANCE SALES FROM USDA TO PRIVATE AGENTS

     WASHINGTON, May 23, 1997--Agriculture Secretary Dan Glickman today
announced  that crop insurance will be available exclusively through crop
insurance agents, beginning in the 1998 crop year.  Previously, the
catastrophic level of crop insurance (CAT) was available through both local
USDA Farm Service Agency offices and crop insurance agents in 36 states. 

     Glickman said this decision was made after carefully reviewing the
number of crop insurance agents in each state to ensure that an adequate
sales force is in place to provide all farmers with CAT coverage.  The 1996
Farm Bill requires USDA to transfer the sales of CAT coverage entirely to
the private sector if a sufficient number of agents are available in each
state to provide this service.

     "While the sales and servicing of policies will be done by the private
sector, " Glickman said, "this change will not weaken the existing safety
net for producers.  I am determined that everyone will have access to crop
insurance -- large farmers and small farmers alike, especially  those with
limited resources, minorities and producers in all areas of the country.

     "Before making this decision, private company representatives gave me
their commitment to reach out to all America's farmers and to assure that
the highest level of risk management service is extended to everyone,"
Glickman said.  " I look forward to this partnership.  I also intend to
exercise appropriate oversight over the companies to ensure compliance with
their commitment." 

     Glickman said this decision was made after carefully reviewing the
number of crop insurance agents in each state to ensure that an adequate
sales force is in place to provide all farmers with CAT coverage.  This
review is required by the 1996 Farm Bill which also requires USDA to
transfer the sales of CAT coverage entirely to the private sector if a
sufficient number of agents are available in each state to provide this
service.

     USDA will continue to subsidize all policies, establish policy terms
and conditions, set rates, and guarantee funds for the payment of approved
claims. 

     The transfer begins with 1998 fall planted crops.  Policyholders  will
receive a letter informing them of this change in about one month.  However,
producers are to continue to go to the local FSA office for service on 1997
policies.  This includes reporting 1997 planted acreage and production as
well as any losses.  

     Although a producer's policy will be randomly transferred from USDA to
an insurance company, producers may select another agent or insurance
company if they do so before the sales closing date for the insured crop. 
To ensure that all producers are served, insurance companies are required to
insure all eligible crops, and provide all levels of coverage in the states
in which they operate.  Further, participating companies must insure all
qualified applicants.  Waiver of administrative fees for producers who
qualify as limited resource farmers is required by the Risk Management
Agency and is available through private companies.  Private agents are
prepared to assist those qualifying producers with certification of their
status. 

     A listing of local crop insurance agents is available in all FSA
county offices.

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