Crop Insurance Impacted by: One Big Beautiful Bill Act
The One Big Beautiful Bill Act (OBBBA) is bringing several important changes to the crop insurance industry—many of which will affect decisions farmers need to make as early as this upcoming season.
In my January 22nd blog, I discussed the importance of reevaluating Enhanced Coverage Option (ECO) policies, as the subsidy was increasing from 48% in 2024 to 65% in 2025. Now, with OBBBA fully in effect, both ECO and Supplemental Coverage Option (SCO) will be subsidized at 80%, making them significantly more affordable.
SCO Coverage Expansion
Historically, SCO has been limited to 86% coverage, but starting in 2027, this will be expanded to 90%—aligning more closely with ECO levels and giving producers broader protection.
Increases to Individual Plan Subsidies
Higher-end individual plans (75–85% coverage levels) will now receive an additional 3–5% premium subsidy, making these higher levels of coverage more accessible and economically viable.
Changes for Beginning Farmers & Ranchers (BFR)
Traditionally, Beginning Farmers and Ranchers (BFR) received a 10% additional subsidy for their first 5 years of farming. Under the OBBBA, this benefit is now extended to 10 years using a stairstep model:
Years 1–2: +5 percentage points (total = 15%)
Year 3: +3 points (total = 13%)
Year 4: +1 point (total = 11%)
Years 5–10: standard BFR subsidy (10%)
If you’ve previously qualified as a BFR but “aged out” after 5 years, you can now reapply to access the remaining years of eligibility.
In Conclusion
As crop insurance programs continue to evolve under this legislation, it’s more important than ever to evaluate your coverage strategy. These changes to subsidies—especially in ECO, SCO, and BFR programs—may significantly shift what makes the most sense for your operation financially.
I believe these adjustments are part of a broader strategy to reduce reliance on ad hoc disaster payments and instead strengthen risk management through the federal crop insurance system.
Talk to your crop insurance agent to make sure your plan reflects these updates before the next sales closing date.
Kyle Adams
Crop Insurance Expert | Marketing Advisor, Eastern Corn Belt
With more than a decade of experience as a crop insurance agent, Kyle integrates our marketing strategies with crop insurance products to maximize both sets of tools, creating a well-rounded risk management program for our clients.
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