By Carl Zulauf and Henrique Monaco et.al
Over the last two years, administrative actions and the 2025 Farm Bill have raised to 80% the federal premium subsidy rate for area insurance added on top of individual farm insurance (see farmdoc daily, December 10, 2025). Farmers responded. For the crops that USDA (US Department of Agriculture) reports a cost of production (barley, corn, cotton, oats, peanuts, rice, sorghum, soybeans, wheat), all acres insured in all area add-on insurance products increased by 146 million acres between the 2024 and 2026 crop years (see Figure 1). Their federal premium subsidies grew by nearly $3 billion (see Figure 2). Area add-on insurance’s share of total insured liabilities, total premiums, and federal premium subsidies for the nine crops also increased notably, especially for total premiums and premium subsidies (see Figure 3). Other characteristics are explored in the rest of this article. The data are from the Summary of Business, USDA, Risk Management Agency.
Add-on Insured Acres by Product
By far, the two most purchased 2026 area add-on insurance products were ECO (Enhanced Coverage Option) and SCO (Supplemental Coverage Option) for RP (Revenue Protection) individual farm insured acres (see Figure 4). To be able to buy ECO and SCO, an individual farm insurance product must be bought for the same acre. The individual farm insurance determines the type of ECO and SCO insurance. Fewer than one million acres were insured in ECO and SCO bought for acres insured with individual farm RPHPE (revenue without HPO (Harvest Price Option)) and YP (Yield Protection). For the full name of all product abbreviations in Figure 3, see the appendix table.
Source : illinois.edu