Climate change is a major factor driving soaring federal farm insurance payouts over the last two decades, with the vast majority of those payouts going to the country’s biggest farms using fuel- and carbon-intensive methods, a report from the Environmental Working Group says. Crop insurance payouts skyrocketed 546% from just under $3 billion in 2002 to just over $19 billion in 2022. Crop insurance premiums are federally subsidized, and about 80% of those subsidies go to the biggest one-fifth of farms with about 75% of payouts over the last 20 years going to corn, soybeans, wheat, and cotton.
As climate change continues to drive increasingly expensive farm-harming events, from flooding to drought to hail, those costs are expected to rise. “Our big concern here, when we see increases like this, is how sustainable the program is for both farmers and taxpayers,” Anne Schechinger, an agricultural economist and director at EWG, told Inside Climate News. “I can’t predict what it will cost in the future, but we know with climate change, it will get more expensive.” (Inside Climate News; Climate Signals background: Extreme precipitation increase, Flooding, Drought, Storm intensity increase)