WASHINGTON—Uncertainty over the size of crop insurance subsidies will be a key concern for the insurance industry as a result of the House's surprise decision Thursday to reject legislation to extend the farm program.
Significant Republican as well as Democratic opposition defeated H.R. 1947, the Federal Agriculture Reform and Risk Management Act of 2013, by a vote of 195-234. The bill would have appropriated $940 billion in spending over 10 years, but both the House and Senate bills reauthorize the Farm program for only five years. Authorization for the current program ends Oct.1.
A key issue for disaffected Republicans was an amendment introduced by two Wisconsin representatives, Democrat Ron Kind and Republican Tom Petri, to reduce the crop insurance program by $11 billion over 10 years. The bill would have reduced administration and operating reimbursements to crop insurance carriers to $900 million a year, compared to the $1.3 billion appropriated for the current year. Most of these costs are for agent commissions.
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