USDA's Risk Management Agency revealed elements of the second draft of a proposed Standard Reinsurance Agreement last week. It establishes the terms, roles and responsibilities for the USDA and insurance companies that participate in the Federal crop insurance program. Several changes of the first draft released in December are included.
Senator Chuck Grassley, R-Iowa, a member of the Senate Agriculture Committee, has learned of some of the highlights of the second draft and still has some concerns.
"I'm still concerned that the overall value of the cuts is $6.9 billion, the new cap on agent's commissions and the lock-in 10-year reference prices," Grassley said. "The USDA has moved in the right direction somewhat on a few issues like quota share, a phase in of the administrative and operating changes, and group risk pools. I'll be working with my Senate colleagues on any assistance we can provide from a legislative standpoint."
Stakeholders in the federal crop insurance program have through mid-March to comment on the new draft.