Crop insurance indemnities total $4.4 billion for 2015 crops as of Dec. 28, up from $3.45 billion at the end of November, according to Risk Management Agency (RMA) data.

The level of net acres insured for 2015 crops appears to have set a new record, reaching 297.151 million, ahead of the prior high-water mark of 296.079 million acres in 2013.

The loss ratio for the program currently stands at .45, up slightly from a month ago when it was .37. Indemnities will continue to rise so that loss ratio will also climb. But the lowest loss ratios going back to 2003 are .54 for 2007, .56 for 2010 and .58 for 2009. Rice is the only program crop with a loss ratio greater than 1.0 for 2015 crops (indemnities paid out exceed the premiums paid in) with a mark of 2.48. Flue-cured tobacco carries a level of 1.14.

The total payouts at $4.4 billion are down more than 50% from the 2014 crop total of $9.115 billion. Wheat remains the top payout on a by-crop basis, with indemnities of $1.155 billion compared to corn at $1.118 billion. The next closest crop is soybeans at $832 million.

The downturn in payouts under the program reflects fewer crop issues facing producers and lower prices for most crops compared to 2014 levels. The indemnity levels are likely to continue rising as we move into calendar 2016. At this stage a year ago for 2014 crops, indemnities stood at $5.212 billion and eventually rose to $9.115 billion. The potential is there for 2015 crops to be one of the lowest payout levels in recent years and give the program one of its lowest loss ratios in years.

Source - kticradio.com