Critics have long contended that crop insurance is so vital to farmers that changes in premium rates will have no impact on participation.
Results from Woodard's analysis of the demand for crop insurance on Illinois corn found that participants would purchase lower levels of insurance coverage as premium prices rise. Some participants may drop out of buy-up coverage altogether, Woodard noted.
With crop insurance, farmers pay for a portion of their safety net – collectively between $3.5 billion and $4 billion a year – so taxpayers don't shoulder all the risk. And aid arrives in weeks, not months or years, because private-sector insurers process claims instead of the government.