Bill Overview
Title: TEMP Act
Description: TEMP Act This bill directs the Federal Crop Insurance Corporation to conduct or enter into contracts to carry out research and development regarding a temperature-based index policy to insure crops on a nationally-available basis against losses due to a frost or cold weather event, including research to evaluate the effectiveness of risk management tools with respect to low frequency and catastrophic loss weather events.
Sponsors: Rep. Steube, W. Gregory [R-FL-17]
Target Audience
Population: Farmers and agricultural workers involved with crops subject to frost damage
Estimated Size: 1000000
- The TEMP Act focuses on developing insurance for crops against frost or cold weather events.
- Farmers across the United States rely on crops for their livelihood, and frost can have significant impacts on their production and revenues.
- Different crops have varied susceptibilities to frost; hence, farmers growing vulnerable crops will be particularly affected.
- According to USDA data, there are approximately 2 million farms in the U.S., and many are susceptible to frost damage.
- Globally, there are around 570 million farms, most of which may deal with temperature-related events like frost, particularly those in temperate climates.
- Farmers in regions prone to cold weather would be the primary beneficiaries of this act.
- The insurance industry will also be impacted as they will have to develop and offer temperature-based policies.
Reasoning
- The TEMP Act is intended to protect farmers whose crops are vulnerable to frost and cold weather.
- Farmers in colder regions of the US such as the Midwest, Northeast, and Northern Plains are more likely to benefit.
- Many farmers do not currently have insurance that adequately covers temperature-related events, creating a potential gap that this policy aims to fill.
- The policy's budget may limit the scale of its initial implementation, meaning not all affected farmers will see immediate relief.
- Farmers with diverse crop types might not be as impacted, especially those whose crops are less susceptible to frost damage.
- Crop insurance is a vital tool for risk management in agriculture, directly affecting farmers' mental and financial wellbeing.
- This simulation covers a range of individuals to represent the diversity in the farming community and some indirectly affected individuals.
- The costs and availability of the program are significant factors determining who will benefit and to what extent over time.
Simulated Interviews
Corn farmer (Iowa)
Age: 52 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 12/20
Statement of Opinion:
- This policy could be a lifeline during those unexpected frost events.
- I'm hopeful it will help stabilize our income and give us peace of mind.
- The premium costs will determine if it's actually feasible for us.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 5 |
| Year 10 | 9 | 5 |
| Year 20 | 9 | 5 |
Dairy farmer (Wisconsin)
Age: 45 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 10/20
Statement of Opinion:
- It's a good policy, but since my crops aren't really affected by frost, it won't change much for me.
- I'm more focused on other weather events that are a bigger threat to my farm.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Soybean farmer (Minnesota)
Age: 60 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 20.0 years
Commonness: 8/20
Statement of Opinion:
- I've been waiting for something like this. It could make a huge difference in managing our financial risks.
- If it covers the costs effectively, I'll definitely use it.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 4 |
| Year 3 | 8 | 4 |
| Year 5 | 8 | 4 |
| Year 10 | 9 | 3 |
| Year 20 | 9 | 3 |
Vineyard manager (California)
Age: 34 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 5/20
Statement of Opinion:
- It's likely this won't impact me much, but it's reassuring to have the protection available.
- More concerned about heatwaves and water shortages in my area.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Apple orchard owner (Ohio)
Age: 39 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 15.0 years
Commonness: 6/20
Statement of Opinion:
- The potential for financial losses every year keeps me up at night.
- This insurance could offer the security I need to plan my business better.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 8 | 5 |
| Year 5 | 8 | 4 |
| Year 10 | 8 | 4 |
| Year 20 | 9 | 4 |
Cotton farmer (Texas)
Age: 48 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 11/20
Statement of Opinion:
- I doubt this will affect my operations directly.
- Farmers in cooler climates might benefit, but it's not much help for me.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Cherry farmer (Michigan)
Age: 54 | Gender: female
Wellbeing Before Policy: 4
Duration of Impact: 20.0 years
Commonness: 4/20
Statement of Opinion:
- Cherry farming is particularly vulnerable to late frosts, so this policy could provide crucial protection.
- It's a necessary step towards making farming viable in this area again.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 4 |
| Year 2 | 7 | 4 |
| Year 3 | 8 | 3 |
| Year 5 | 9 | 3 |
| Year 10 | 9 | 3 |
| Year 20 | 9 | 3 |
Local market gardener (New York)
Age: 42 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 14/20
Statement of Opinion:
- While it's a good safety net, I doubt I'll need this policy annually.
- I tend to manage these risks with greenhouses and other methods.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Beginning grain farmer (Nebraska)
Age: 28 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 15.0 years
Commonness: 15/20
Statement of Opinion:
- Starting out, it's tough to deal with unexpected events like frost hits.
- Knowing there's support like this around helps me feel more secure taking risks in agriculture.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 8 | 5 |
| Year 10 | 8 | 5 |
| Year 20 | 9 | 5 |
Retired former rancher (Montana)
Age: 65 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 2/20
Statement of Opinion:
- The group I work with raises a lot of potential crops susceptible to frost, so we could certainly use this help.
- I see it as a positive change that secures our activities.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 8 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 6 |
Cost Estimates
Year 1: $50000000 (Low: $40000000, High: $60000000)
Year 2: $52000000 (Low: $42000000, High: $62000000)
Year 3: $54000000 (Low: $44000000, High: $64000000)
Year 5: $58000000 (Low: $48000000, High: $68000000)
Year 10: $0 (Low: $0, High: $0)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- The necessity for robust climatological data and modeling to justify the insurance policy pricing.
- Potential variations in the uptake by farmers in different regions based on other available risk mitigation tools.
- The gradual process of testing and implementing this insurance policy before reaching significant coverage.