The "Quality Loss Adjustment Improvement for Farmers Act" improves the Federal Crop Insurance Act by mandating regular reviews of quality loss adjustment procedures, requiring diverse stakeholder engagement, directing reports to Congress, and establishing State or regional discount factors for soybean crops.
John Kennedy
Senator
LA
The "Quality Loss Adjustment Improvement for Farmers Act" improves the Federal Crop Insurance Act by mandating regular reviews of quality loss adjustment procedures, starting in 2025, with stakeholder engagement and reports to Congress. It also requires the establishment of State or regional discount factors for soybean crops to reflect local market prices after a disaster. These discount factors must be included in the periodic reviews and reports.
Crop Insurance Overhaul Mandates 5-Year Reviews and Better Soybean Loss Calculations Starting 2025
Congress is looking to fine-tune how farmers get paid when their crops take a hit in quality, not just quantity. The Quality Loss Adjustment Improvement for Farmers Act amends the Federal Crop Insurance Act, setting up a system for regular check-ups on the procedures used to calculate these quality-related insurance payouts. Starting in 2025, the Federal Crop Insurance Corporation (FCIC) must hire an outside expert every five years to review its quality loss adjustment methods.
Keeping the System Fair and Current
Think of it like a performance review for the insurance rules. Every five years, an independent reviewer will dig into how the FCIC figures out payments when things like hail, disease, or excessive rain damage the quality of a harvest, even if the yield isn't totally wiped out. A key part of this review is mandatory "engagement from diverse industry stakeholders" for every crop covered. This means getting feedback from farmers, processors, and others actually involved with specific crops to ensure the adjustment process reflects real-world conditions. After each review, the FCIC has to report its findings, any changes made, and who they talked to, directly to the House and Senate Agriculture Committees, adding a layer of transparency.
A Specific Fix for Soybeans
The bill also calls out a specific need for soybean farmers. It directs the FCIC to establish state or regional "discount factors." These factors are meant to better reflect the actual lower prices soybeans might fetch in local or regional markets if there's been a disaster declaration or if a "salvage market" situation occurs (basically, when damaged crops have to be sold off cheap). This aims to make insurance payouts more accurately reflect the real financial loss for soybean growers in those specific disaster situations. These new soybean factors will also be part of the regular five-year reviews and reported to Congress, ensuring they stay relevant.