Cover Crops, Crop Insurance Losses, and Resilience to Extreme Weather Events

AAEA members release new research in AJAE

New research findings indicate that a one-percentage-point increase in county-level cover crop adoption rate has the potential to reduce excess-moisture-related Loss Cost Ratio (LCR) by 0.129 percentage points, where LCR is defined here as the ratio of total indemnities due to excess moisture (e.g. floods) over total liabilities,. Based on this estimate, the study results roughly suggest that a one percentage point higher cover crop adoption rate in 2018 (i.e., ~3.9 million acres more) could have reduced excess-moisture-related indemnities that year in the US by $60.42 million.

In the article “Cover Crops, Crop Insurance Losses, and Resilience to Extreme Weather Events” published in the American Journal of Agricultural Economics, Serkan Aglasan from the University of Arizona, Roderick Rejesus from North Carolina State University as well as Stephen Hagen and William Salas from Regrow Ag®, find out if cover crop adoption mitigats drought, heat, or excess moisture-related crop insurance losses.

The authors say, “The findings suggest that counties with higher cover crop adoption rates tend to experience lower crop insurance losses due to drought, heat, or excess moisture related weather events. This analysis also indicates that cover crops likely have stronger loss mitigation effects against excess moisture events (e.g., floods) and somewhat weaker loss mitigation impacts against droughts and excess heat. Overall, our findings suggest that cover crops can enhance resilience to extreme weather events and have the potential to be an effective climate change adaptation strategy in US agriculture.”

If you are interested in setting up an interview, please contact Allison Ware in the AAEA Business Office.

ABOUT AAEA: Established in 1910, the Agricultural & Applied Economics Association (AAEA) is the leading professional association for agricultural and applied economists, with 2,500 members in more than 60 countries. Members of the AAEA work in academic or government institutions as well as in industry and not-for-profit organizations, and engage in a variety of research, teaching, and outreach activities in the areas of agriculture, the environment, food, health, and international development. The AAEA publishes three journals, the Journal of the Agricultural and Applied Economics Association (an open access journal), the American Journal of Agricultural Economics and Applied Economic Perspectives & Policy, as well as the online magazine Choices and the online open access publication series Applied Economics Teaching Resources. To learn more, visit www.aaea.org.

Contact: Allison Ware
Senior Communications & Membership Manager
(414) 918-3190
Email: aware@aaea.org