crop insurance

USDA Wants More Done to Combat Crop Insurance Fraud

Dan Industry News Release

crop insuranceThe Inspector General at the U.S. Department of Agriculture says the Risk Management Agency hasn’t done enough to combat crop insurance fraud.

Since 2001, the RMA has contracted with the Center for Agribusiness Excellence at Tarleton State University in Texas to collect data on producers who have unusual crop insurance claims that merit further review. Every year, the center produces lists of producers that might need to be spot-checked by the Farm Service Agency, as well as by private insurance companies. Most farmers that wind up on the spot-checklist reduce their claims after a review. In 2015, those lowered claims saved about $61 million.

However, the USDA says the Risk Management Agency needs to expand its use of the data turned up by the Center for Agribusiness Excellence. For example, the inspector general says the RMA hasn’t collected information from the insurance reviews to identify any possible weakness in the insurance program. The IG also found that the Farm Service Agency is more likely to find fraud than most insurers are.

The RMA is also going to finalize some changes in their review processes to better identify the root causes of insurance claim errors.

From the National Association of Farm Broadcasting News Service.