Why Is Crop Insurance Important for Farmers?

In a world of food apps and delivery drones, it is easy to forget the real food creators—farmers.

Whether it’s a burger, chicken, pasta, avocado, or orange juice, you can trace them back to a farmer. Unfortunately, farmers endure multiple risks in delivering food to millions of Americans.

A crop farmer must deal with a hot summer, pests and diseases, water shortages, input price fluctuations, and market dynamics. Farmers can acquire crop insurance to protect their investments from unforeseen losses.

Consider speaking to a trusted crop insurance agent to protect your farm from risks that bring financial loss.

Benefits of Crop Insurance for Farmers

Financial Security

A crop farmer with an insurance policy has a defense strategy against unforeseen events likely to bring substantial financial losses. If a flooding event occurs in a cornfield, it can lead to total crop failure.

Fortunately, crop insurance offers a cushion to help farmers recover a significant portion of their investment. After a crop failure, the insurer pays the affected farmer according to the insurance limits.

Consequently, it reduces the financial burden and uncertainty related to crop failure.

Enhanced Access to Credit and Finance

Many financial institutions are less inclined to extend credit products to players in crop farming because of associated risks. However, a crop insurance plan is one way a farmer can obtain better credit ratings.

An insured farmer has better chances to obtain credit from banks and other financial institutions.

A crop insurance package acts as collateral, which mitigates the risk of default in case of crop failure. After attaining enhanced credit access, farmers can scale their production, resulting in higher profitability.

Confidence for Long-term Planning

Farmers with a crop insurance policy can make long-term plans for their farming operations. They can build long-term structures such as silos, irrigation systems, solar power, windmills, and office blocks.

A farmer who has protected their investment with crop insurance has the confidence to hire a permanent and skilled worker. As a result, they can enjoy improved productivity and peace of mind.

Preservation of Livelihood

For most people, crop farming is not just an investment; it is their way of life and source of livelihood. Many crop farmers have built homes next to their farms, which can expose them in case of calamity.

They would face food insecurity and financial disruption if a significant drought, flood, pest outbreak, or water shortage occurred. Crop insurance is vital to small-scale farmers who may struggle to recover from losses without crop insurance.

Let Us Protect Your Investment With Crop Insurance

If a pest outbreak occurs, all your crops could die, flushing your investment down the drain. While it’s difficult to foretell future calamities, you can stay prepared through risk management strategies like crop insurance.

The numerous risks that a crop farmer faces highlight the need to buy a solid insurance plan.

At Panorama Insurance Agency, we work with multiple insurers to give a tailored insurance package that meets your farming needs.

Contact us online or call us at 818.579.9663 to request a quote.