Agriculture is an inherently risky business. Some risks are everyday business risks; some risks are brought on by natural disasters. Producers need to regularly manage for financial, marketing, production, human resource and legal risks.
Helping farmers and ranchers overcome such unexpected events, not only benefits individual producers, but also rural communities that depend on agriculture. Over time, resilient rural producers help form robust rural economies, which build a strong economic foundation and provide improved access to credit for the next generation of beginning farmers and ranchers.
By providing innovative federal crop insurance to help individual producers prosper, the Risk Management Agency (RMA) is collectively helping rural economies become more self-sustaining across the country. New producers, especially those who are located within rural communities, may benefit from the safety net afforded by crop insurance. A variety of USDA web resources are available to help new producers get started.
Beginning farmers and ranchers include those who have not actively operated and managed a farm or ranch in any county or state with an insurable interest in a crop or livestock as an owner-operator, landlord, tenant or sharecropper for more than five crop years.
The 2014 Farm Bill increased the importance of crop insurance for agriculture by providing more insurance options for even more farms and ranches. For instance, beginning farmers and ranchers’ premium support rates will increase 10 percentage points during their first five years of farming; and they’ll receive an exemption from paying the $300 administrative fee for catastrophic policies.
Crop insurance has long been an important part of the farm safety net, providing a reliable and cost-effective risk management tool that keeps farms and ranches alive through the tough years. For new producers and their surrounding rural economies, this safety net also helps sustain rural America’s contributions to the nation’s food supply year after year, in spite of unpredictable business or natural disaster risks.