(Bloomberg)—This year’s once-in-a-generation drought may leave many crop farmers largely unscathed as they are protected by taxpayer-subsidized insurance, a program Congress is moving to make more generous.
With prices for corn, soy and wheat escalating along with estimates of the drought’s severity, government-backed revenue- insurance policies offered through units of companies such as ACE Ltd. and Wells Fargo & Co. probably will be paying out billions of dollars in claims. And the program is designed so that the larger the losses for insurers, the greater the share of the payouts the government will pick up.
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