Another panelist, William Cole, with the Cole Agency, a crop insurance provider at Batesville, Miss., has been an agent for 17 years, and is a member of the board of the Crop Insurance Professionals Association (CIPA).

“Over the years, crop insurance has had its highs and lows,” he says. “At one point, we were lucky to even have a program — and now it looks like crop insurance is going to be the cornerstone of the next farm bill.

Figures indicate, Cole says, “that our current program is really working, and that we’re going in the right direction.

We had 264 million acres covered nationwide last year —more acres than ever before. Total premiums paid and total coverage slashed all previous records. We had $4.5 billion in premiums paid and total coverage of $114 billion, roughly 20 percent more than the previous record.

“As of mid-January, we’d paid out $9.4 billion in indemnities, and that probably will go over $10 billion for 2011. All this is pretty impressive, considering where we were several years ago.”

Mississippi has consistently lagged behind the rest of the country in utilization of crop insurance, Cole says, “but we’re making big improvements. Since 2007, we’ve added 200,000 acres, now covering more than 3.5 million acres in the state.

“More importantly, catastrophic risk protection (CAT) acres have dropped from 1.6 million acres to in 2007 to 884,000 last year, which means more people are buying up to get higher coverage levels.”

There were 2.6 million acres of buy-up insurance purchased in 2011, he says, representing nearly $1.4 billion in coverage. “We had 1.8 million acres covered in 2007, but only $568 million in coverage.”

The “interesting thing about crop insurance,” Cole says, “is that anyone who has an idea for improving the program can take it before the Federal Crop Insurance Corporation board and, if that idea has merit, it can be approved and can be added as a new policy, or as a change or option.
“In 2011, cotton farmers saw a need for an option for cottonseed to cover the entire boll rather than just the lint. That project was worked on for three years by the Plains Cotton Growers at Lubbock, and now all cotton growers are benefiting from their work.”

The USA Rice Federation group has been working with the Crop Insurance Professionals Association on a downed rice endorsement, Cole says, which would cover the extra costs associated when a hurricane hits and lays the rice down. “We’re hopeful that this project will win approval.”

Another project, which he says “could be revolutionary,” is a margin coverage policy for rice, which would address big spikes in input costs. ‘This an entirely new direction for crop insurance, and it will be interesting to see how this develops.’

Also, he says, several groups, including CIPA, are working to improve the Actual Production History (APH) provisions that are “the foundation of all crop insurance programs that we’re working with in our state. We’re trying to address trending yields, especially those that affect our crops — cotton, soybeans, corn, and rice.

“As we move toward crop insurance provisions of the 2012 farm bill, we want to make sure we keep a program that works for everyone. I think the way the trend is working is that they want to try to prevent and protect against shallow losses.

“I think the way Farm Bureau and other groups want to proceed is to base this on similar Group Risk Income Protection (GRIP) policies. We sell GRIP policies, but in Mississippi they just haven’t been well-received. In 2007, we had 97,000 acres covered under GRIP  — last year, all the crop insurance agents based in Mississippi sold only 1,300 acres worth of GRIP coverage.”

Among the reasons for that, Cole says, “I think farmers don’t see it as a true risk management, but rather as a gamble that your experience will be exactly the same as the county’s.

“On the other hand, we like a GRIP-type policy that helps with the shallow losses, but keeps the current program in place, similar to the National Cotton Council’s Stacked Income Protection Plan (STAX), and feel that’s a wise way to go.

“I think we’ve got a long way to go with the next farm bill,” Cole says, “but I think our Mississippi members of Congress are working for our benefit, and it’s important that we’re all on the same page that the main idea is to ‘do no harm.’”