National measures in place to strengthen crop insurance program

WASHINGTON – New measures are under way to improve oversight of the federal crop insurance program. The USDA’s Risk Management Agency, Farm Service Agency and private reinsured crop insurance companies that sell and service crop insurance policies have joined forces in a nationwide effort to improve the integrity of the program.

Abuse to end. With broad expansion of the program in recent years and even more expected in the near future, the Agricultural Risk Protection Act has provided USDA greater ability to curb program abuse.

In order to discourage program abuse, violators are now subject to criminal prosecution, civil suit, and administrative sanctions. Administrative sanctions can include fines, disqualification from crop insurance and other USDA programs, and government-wide debarment and suspension.

Coordinated plan. Earlier this year, USDA began implementation of new oversight procedures that utilize the broad-based assistance of the Farm Service Agency to carry out monitoring and oversight of the crop insurance program.

Reinsured companies will work closely with the two federal agencies in implementing the new procedures. Companies will continue to play a major role in the oversight of crop insurance through their internal procedures and by taking prompt corrective action to identified problems.

The coordinated compliance monitoring program also provides for expanded data exchange between the two agencies and reinsured companies. Information provided to FSA offices and reinsured companies by insured producers will be reconciled in an effort to research and identify inconsistencies.