Wednesday, May 2, 2007

Global Warming -- Watch on Rising Insurance Rates

It doesn’t matter – crop insurance, flood insurance, you name it! We can expect taxpayer-funded insurance programs to only go up. See more details here.

“Investigators Warn of Global Warming Costs … Taxpayer-Funded Insurance Program May Take a Hit” by David Lightman and Joel Lange, Hartford Courant. 4/19/2007

1 comment:

Anonymous said...

Because most Federal Crop Insurance Corp. programs have been in place for scores of years (FCIC will turn 70 next year) rates are made on a retrospective basis; that is, looking backwards.

The threat of global warming does not automatically mean increased crop insurance rates.

Federal crop insurance rates will go up only if losses actually increase. And then they will only go up gradually. FCIC generally bases its rates on the past 20 year's experience.

None of this means that global warming isn't vitally important to farmers.

Globally warming means increased risk for farmers. It increases uncertainty about growing conditions, about best management practices, and about likely harvests. All of these things have a direct impact on whether a farm will succeed or fail.

Farmers should take three steps:

1. Learn all they can about global warming;

2. Support efforts to reverse it and to mitigate its effects; and

3. Learn about and use risk management tools (including Federal crop insurance) that will protect them from some of the effects of GW.