The Business Side of Crop Insurance

<a href="http://www.washingtonpost.com/wp-dyn/content/article/2006/10/15/AR2006101500585.html">Crop Insurers Piling Up Record Profits</a><br />n<br />nYesterday the Post ran a story about crop insurance, disaster aid and farmers. Today the story is about the business of crop insurance and how the companies that sell it are making billions off taxpayer dollars.<br />n<br />n<blockquote>Last year, the companies made $927 million in profit, a record. They received an additional $829 million from the government in administrative fees to help run the program. On top of that, taxpayers kicked in $2.3 billion to subsidize premium payments for farmers.<br />n<br />nAll of that to pay farmers $752 million for losses from bad weather.<br />n<br />n"We would probably be better off just giving the farmers the money directly," said Bruce A. Babcock, an agricultural economist at Iowa State University who recently published his own study of the program. "That way we would save on all of the fees going to the private insurers."</blockquote> <br />n<br />n$927 million in profit. Hell of a business to be in and the good thing is, no competition. The government doesn't allow it. One company tried to introduce competition but nit was shot down by none other than Conrad Burns of Montana. Yes, you Burns haters that stop by here get more ammunition to beat him with, not that you need any more.<br />n<br />nA real interesting article on crop insurance and the scam it is for the business, not any one else.