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As temperatures rise in the Southwest, so do crop insurance costs

Image of a sun setting on a
Image of a sun setting on a field

A new analysis published by the Environmental Working Group (EWG) said that rising temperatures in Arizona, California, Colorado, Nevada, New Mexico and Utah are causing heat-related crop insurance costs to go up. But there is no data on the specific amount that insurance costs have increased in the Southwest.

The analysis said that in all six states, heat generated the fourth highest total amount of indemnity payments out of all causes of loss within the time of the EWG study.

“This new analysis really is further evidence to us that the crop insurance program really needs to be reformed to incentivize farmers to adapt to climate change," said Anne Schechinger, EWG’s Midwest director, "because the climate crisis is already making the crop insurance program more expensive. And as the program stands now, it really discourages farmers from adapting to extreme weather.”

What she means by that is that the premium paid by farmers, on average, is 38%. The other 62% is covered by taxpayers. So, farmers are less likely to pay out of their own pockets to adapt to climate change because they don’t see the whole dollar amount that is required to insure their farm.

But there are things they can do to adapt. There’s a whole list of conservation practices that a farmer can choose from to participate in, but a common one is cover crops.

“So, cover crops is where you plant a crop at the end of the season, like you know, in the fall after you harvest your main crop, and then the cover crop grows over the winter. So then there's something holding soil in place. And cover crops can really hold in soil moisture," Schechinger said.

Data is showing that temperatures are going to keep rising, and in a field of work where money is tight already, Schechinger said that participating in conservation practices can only help.

Analysis Report: