By Carl Zulauf and Bruce Sherrick et.al
Although early in the reporting period for 2025 crop insurance decisions by farmers, use of ECO (Enhanced Coverage Option) insurance has tripled vs 2024. The key change from 2024 is an increase in ECO premium subsidy implemented by USDA, RMA (US Department of Agriculture, Risk Management Agency). ECO subsidy rate is now 65% compared to the prior rates of 44% when ECO was combined with individual farm revenue coverage and 51% when combined with individual farm yield coverage. The tripling in use of ECO provides insights into the likely response to the proposed increase in the premium subsidy rate for SCO (Supplemental Coverage Option) insurance from 65% to 80% in both the House and Senate Reconciliation Farm Bills.
Area Add-Up Insurance
Three area add-up insurance products are discussed in this article: ECO (Enhanced Coverage Option), SCO (Supplemental Coverage Option), and STAX (Stacked Income Protection Plan). ECO coverage is either 95% or 90% of an area revenue or yield policy down to 86%, the coverage level of SCO. ECO can be purchased without buying SCO, and vice versa. Acres in ECO can be in either the ARC (Agriculture Risk Coverage) or PLC (Price Loss Coverage) farm commodity programs. For further discussion of ECO, see the February 11, 2025 farmdoc daily.