Bermuda Firms Benefit From US Program
Twenty insurance companies in Bermuda, Japan, Switzerland, Australia, Canada and the US were paid $7.1 billion in US taxpayer funds from 2007 to 2011 to sell American farmers crop insurance policies, an Environmental Working Group [EWG] analysis shows.
The EWG is an American environmental organization which specialises in research and advocacy in the areas of toxic chemicals, agricultural subsidies, public lands, and corporate accountability.
The US Department of Agriculture’s Risk Management Agency paid the overseas companies for administrative and operating expenses for the federally subsidised crop insurance program, the Washington-based EWG said.
The agency also reported $8.1 billion in underwriting gains during the same period but has not disclosed how much of the gains each company received. EWG has filed a Freedom of Information Act request for this information.
Switzerland- and Bermuda-based ACE Limited was the second largest recipient of these payments raking in $1.5 billion. Australia-based QBE Insurance Group ranked third, with $832 million; and Bermuda-based Endurance Specialty Holdings Limited ranked fifth, with $446.3 million.
“More and more tax dollars are flowing to foreign insurance companies and away from farmers, working families and the environment,” Scott Faber, EWG Vice President for Government Affairs, said at a media briefing on the 2012 farm bill. “These insurance subsidies are being provided with no strings attached to the largest and most profitable farm operators and foreign insurance companies.”
Payment to companies for administrative and operating expenses are only part of the growing cost to taxpayers of crop insurance.
US taxpayers also pick up the tab for the subsidies that lower the premiums farmers pay. The taxpayer’s share of these premiums has soared from $1.5 billion in 2002 to $7.4 billion in 2011.
Crop and revenue insurance is now the primary federal support for farm income. In 2011, taxpayers forked over $5.2 billion on direct and Average Crop Revenue Election [ACRE] payments and $7.4 billion on insurance premium subsidies.
“Insurance programs are now more valuable to farmers than direct payments,” said Craig Cox, EWG Senior Vice President for Agriculture and Natural Resources. “There are far less costly ways to help America’s farmers in times of need.”
EWG is a non-profit organization whose mission, according to their website, is “to use the power of public information to protect public health and the environment.”
