FARMER Act Boosts Crop Insurance Subsidies to 80%, Cutting Premium Costs for Producers

The Federal Agriculture Risk Management Enhancement and Resilience Act of 2025, or the FARMER Act, is all about making crop insurance cheaper and more widely available for producers. This bill takes aim at the Federal Crop Insurance Program, significantly increasing the amount the government chips in to cover farmers’ insurance premiums.

The Government’s New Share: Up to 80% Off

If you’re a farmer relying on crop insurance, this bill is designed to lower your annual costs. The biggest change is tucked away in Section 3, which deals with the Supplemental Coverage Option (SCO). The SCO provides extra protection against shallow losses over a whole area (like a county). Right now, the federal government covers 65% of the premium for this option. The FARMER Act raises that percentage to a hefty 80%. Think of it this way: for every dollar a farmer spends on an SCO premium, the government is now picking up 80 cents, up from 65 cents. This makes an already popular risk management tool much more affordable, potentially encouraging wider use among producers struggling with tight margins.

Incentivizing Whole-Farm Protection

Section 2 focuses on farmers who choose comprehensive, whole-unit insurance plans—specifically individual farm-based revenue protection or yield protection plans that cover either their entire enterprise unit or their whole farm unit. These plans are key for managing risk across diverse operations. To incentivize this comprehensive coverage, the bill increases the premium support percentages for these specific plans. Depending on the coverage level chosen, the government’s premium support will now be set at either 77 percent or 68 percent. This move directly reduces the out-of-pocket expenses for producers who are already committed to insuring their entire operation, rewarding those using the most integrated risk management strategies.

Expanding Coverage to Bigger Areas

While the subsidy increases are immediate cost savings, Section 4 looks toward the future accessibility of insurance. It mandates that the Federal Crop Insurance Corporation conduct a study within one year on how to adjust the Supplemental Coverage Option (SCO). Currently, the SCO might be limited in larger geographic areas, specifically those over 1,400 square miles, which can be an issue in vast agricultural states. The study will explore the feasibility of expanding the SCO to these larger counties, offering coverage that could be more tailored than the current county-wide option, or more comprehensive than existing individual policies. This study is crucial for ensuring that effective risk management tools are available to all producers, regardless of their county size.

What This Means for the Bottom Line

For the farmer, the immediate impact is clear: lower insurance bills and better protection against bad weather or market dips. For example, a farmer who spends $10,000 annually on SCO premiums could see their out-of-pocket cost drop from $3,500 (at 65% subsidy) to just $2,000 (at 80% subsidy). However, it’s important to note the flip side: raising these subsidy percentages means the cost is transferred directly to the federal budget, increasing the financial burden on taxpayers. While the bill aims to stabilize the agricultural sector, it does so by significantly increasing the federal financial commitment to crop insurance programs.