Is it Time to Specialize in Crop Insurance?

June 24, 2022

Think of insurance coverage and what comes to mind? Car insurance, homeowners coverage, life insurance. What about crop insurance? Unless you have a tie to the agricultural field, you may not even know this type of coverage exists.

You don’t have to be a farmer to start selling crop insurance. With the right education and tools, any motivated agent can make the jump to crop insurance sales. We’ll walk you through the basics and what you need to get started as a crop insurance agent.

What Is Crop Insurance?

Crop insurance is a type of agriculture insurance farmers, ranchers and other agricultural producers can use to protect against the loss of their crops or lower yields due to natural disasters or a loss of revenue.

What Types of Crop Insurance Are There?

Crop-hail insurance protects farmers from losses incurred by hail damage to crops. Federal multiple peril crop insurance covers losses and lower yields caused by natural disasters and events like destructive weather, drought, fire, flooding, disease and insect damage. The cost of the insurance depends on the value of the crop. Not all crops are covered in every area.

Is Crop Insurance New?

Far from it. Private crop insurance sales began in America around 1880, protecting farmers against losses from hail damage. In 2020, farmers spent more than $1 billion on crop-hail insurance to protect $36 billion worth of crops.

In 1981, only 45 million acres and $6 billion worth of crops were insured by the federal crop insurance program. In 2020, 1.1 million policies protected more than 130 crops across 480 million acres — a value of $114 billion.

A 2018 USDA Economic Research Service estimate indicates that 87% of planted acres had crop insurance coverage.

What Is a Crop Insurance Agent?

Crop insurance agents sell these policies to farmers, ranchers and others in the agricultural field. Crop insurance agents need skills and knowledge beyond that of a typical insurance salesperson, including a basic knowledge of crops and strong risk-management skills in relation to crop production.

What Are Crop Insurance Agent Requirements?

Crop insurance agents need a crop-hail and multiple-peril insurance agent license to sell insurance policies. Licensing requirements vary by state, but in general, you need to have a high school diploma and pass a crop insurance licensing examination.

How Is Selling Crop Insurance Different Than Other Insurance Sales?

For one, there’s a lot more competition. While there are millions of people who need life, home, auto and health insurance, it’s a different story with crop insurance. It’s a saturated market that can be tough to break into.

Depending on where you live, you may need to travel to meet potential clients. If you live in a rural area, expect that many potential clients are already covered.

You’ll also need to know your stuff. Perhaps more than any other sector of insurance, you need to stay up to date on industry trends and changes to keep your clients — and their crops — protected.


How to Get Started

Interested in selling crop insurance? Reach out to a District Manager about how you can get started.