PIA backs House bill to reinstate inflation adjustment for crop insurers
Inflation adjustments have not been made to the pool of funds used to pay agent commissions since 2015.
If passed, a bill introduced last week in the U.S. House of Representatives would reinstate an inflation adjustment for crop insurers. The bipartisan Ensuring Access to Risk Management Act of 2024 is also backed by the National Association of Professional Insurance Agents (PIA).
The 2011 Standard Reinsurance Agreement (SRA) previously established a cap on the administrative and operating expense subsidy, which is a pool of funds that crop insurers use to pay agent commissions. However, in 2016 the USDA’s Risk Management Agency (RMA) stopped making annual inflation adjustments to the total subsidy cap. The cap has remained fixed in 2015 dollars ever since.
PIA and its allies successfully advocated for language to be added to an appropriations package in late 2022 that stated Congress’ belief that the RMA had the authority to reinstate the inflation adjustment for the subsidy without having to renegotiate it. Despite this, the RMA continued to insist it didn’t have the legal authority to reinstate the adjustment and declined to act on the declaration.
“The RMA’s decision to stop adjusting A&O for inflation devastated crop agents and agencies,” PIA’s Chief Public Affairs and Advocacy Officer Jon Gentile said in a release. “Jobs have been lost, small business growth has been impaired, and local community investments have, in many cases, disappeared. If Congress does not provide crop agents with inflation adjustment relief, they are likely to be forced out of the industry, until many farmers no longer have access to knowledgeable agents and their risk management expertise. PIA thanks Reps. Scott, Panetta, and Mann for their support of crop insurance agents and their leadership on this important issue.”
PIA shared in a release that they are also working on a Senate companion bill and will advocate for the Ensuring Access of Risk Management Act’s passage.