Who Pays for our Summer Droughts?

Remember the hot, dry summer of 2012? Due to a lack of rain farmers were hit hard by a shortage of good crops. Did this affect the pockets books of those who own farms? You would think but in reality many farmers actually profited more than if they had ample rain and a good crop season, at least if you believe a recent online article on the subject.

According to one online article, crop insurance not only saved farmers from last years drought but provided them with terrific profits as a reward. One type of crop insurance covers lower harvests or lower prices.

Farmers got a poor harvest and corn and soybeans were in short supply. Prices soared, which benefited farmers. The insurance paid farmers for their lost yield, but paid them at a higher, post dought market price.

Who pays when crop insurance claims are filed? Tax payers, of course, to the tune of about $16 billion in 2012.

I don’t know all the ends and outs of farming or crop insurance. Matter of fact, I know very little. The article I read seemed very believable and seemed to want to steer the reader against farm subsidies, like crop insurance.

Do I think we should discontinue farm subsidies? Probably not. If you speak with a farmer you will come to understand the varied struggles, from the weather and insurance to repairing and maintaining equipment. It’s no small feat running a successful farm. It’s a life that is not always easy but one that most farmers love and would never leave. Still, it does not diminsh the many challenges small farm families face.

If we pressure the small family farmer too much we end up forcing them to sell to large farming corporations. Just what we need – corporations in charge of more farm land. Considering all the money our government hands out to various wasteful programs and foreign nations ensuring our small farmer families can continue providing food for us seems worth it.

We all love to eat, afterall.

More Fallout from Superstorm Sandy

Businesses like restaurants, hotels and retail already hit hard by superstorm Sandy are finding life a bit harder as certain claims are being denied. One claim in particular has generated lawsuits. Customers with “business interruption” coverage filed claims that resulted from the storm interfering with their normal business operations.

However, some insurers are denying claims because it was the flood that knocked out the power which caused the interruption. Flood is not covered under most insurance policies. The businesses are claiming it was not the flood that interrupted coverage but resulting explosions.

Two hundred forty two companies requested mediation, the process involved when clients and insurance companies cannot resolve claims disputes, according to the American Arbitration Association. Most of the cases involve business interruption issues and claim denials. The average claim is approximately $92,000.

It pays to read your insurance policy in advance. While I understand those policies are thick and not the easiest on the eye, there are certain sections worth spending time on and this your actual coverage pages and pages that discuss items not covered.