Most farmers get their crop insurance premium bill sent to them this time of year, with a pay-by date of September 30th. And if that premium is not paid by October 1st, farmers start to get interest charges added to their bill.
“It’s a percent and a quarter a month, so it can start adding up. You know these days a lot of the producers have a pretty good sized premium bill,” said Risk Management Agency Administrator Mark Barbre.
However, Barbre noted this year USDA is giving producers another couple of months before the interest charge kicks in so in this example the date would be December 1st.
“With these late planted crops, these producers across the country are going to be late harvesting and their premiums would have started accruing interest on October 1st for their Spring planted crops,” Barbre noted. “What we’ve done is deferred that interest accrual for two months gives the producers a little more time this fall to get their crops harvested and get some cash flow coming in.”
This is not unprecedented USDA offered a similar delay following the 2012 drought, and hurricanes in 2017 and 2018.