Crop insurance agents are essential partners in the delivery of the Federal Crop Insurance Program. As federal crop insurance increasingly serves as the primary safety net for producers and the public, Congress must require the Risk Management Agency (RMA) to reinstate an annual inflation adjustment for crop agents. PIA is strongly urging Congressional leaders to include this key provision in the ongoing budget reconciliation process. 

Background: The 2011 Standard Reinsurance Agreement (SRA), which is the contract between the federal government and crop insurers, establishes a cap on the administrative and operating (A&O) expense subsidy, a pool of funds from which crop insurers pay agent commissions. Then, beginning in 2016, the RMA stopped making annual adjustments to the total A&O subsidy cap for inflation, leaving the cap fixed in 2015 dollars, where it remains today. These actions resulted in effective cuts to crop insurance agent commissions, during a historically challenging time for agents. 

In late 2022, PIA and its allies successfully advocated for the inclusion of language in an appropriations package, which was ultimately signed into law, stating Congress’ belief that the RMA has the legal authority to reinstate the inflation adjustment without renegotiating the SRA. Despite this explicit Congressional declaration, the RMA insists that it does not have the legal authority to reinstate the inflation adjustment and has declined to act. 

Take Action:

Ask your Member of Congress to support reinstating the inflation adjustment during budget reconciliation. PIA supports this effort to provide an inflation adjustment for all A&O policies, which will ease the impact on agent commissions and better allow agents to serve the increasing risk management needs of producers.

Action Steps:

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