County Add-On Policies Now Take 35% of Crop Insurance Subsidy

Federal premium support for two county-level add-on policies reached 35% of total crop insurance subsidy for nine major crops in 2026, up from 4% in 2024 and 16.7% in 2025, according to University of Illinois farmdoc daily analysis. Subsidy dollars flowing to the Enhanced Coverage Option (ECO) and the Supplemental Coverage Option (SCO) grew more than tenfold in two years, from $0.3 billion to $3.5 billion.

What changed for growers?

The One Big Beautiful Bill Act (OBBBA) raised the premium support rate on both products from 65% to 80% — the same subsidy rate as cotton STAX (a county-level product created as a substitute for cotton Title I programs). That single rate change drove the adoption surge.

SCO and ECO sit on top of farm-level policies such as Revenue Protection (RP), Revenue Protection with Harvest Price Exclusion (RP-HPE), Yield Protection (YP) and actual production history (APH) coverage. Because SCO picks up at the coverage level of the underlying policy, some farmers have trimmed farm-level coverage as they added the county products.

The numbers on adoption, measured against eligible acres for the nine crops USDA tracks for cost of production (corn, soybeans, wheat, cotton, rice, grain sorghum, peanuts, barley, oats):

• SCO adoption moved from 4.8% in 2024 and 4.9% in 2025 to 29.6% in 2026 after the 80% subsidy rate took effect.
• ECO adoption rose from 6.5% in 2024 to 26.6% in 2025, after the Risk Management Agency lifted its subsidy rate to 65%, then to 51.8% in 2026 (data as of October 20).

ECO-95 led the increase nationwide. The policy covers a narrow band — county losses from 95% down to 86% — but it triggers frequently and therefore carries a high premium per acre. RP was the most commonly elected underlying coverage.

Where the shift is concentrated

Regional variation is substantial. SCO adoption exceeded 50% in the Texas panhandle, driven by cotton. By switching from cotton STAX to SCO, cotton producers regained eligibility for commodity title payments — a change the OBBBA made. Midwestern and Great Plains counties showed SCO adoption of 30-50%.

ECO uptake was widespread for corn and soybeans, for wheat in the Northern Plains and for cotton in Texas. In some counties, ECO covered more than 75% of eligible acres.

The subsidy picture mirrors adoption. Total premium subsidy across the nine crops rose from about $7.46 billion in 2024 to $10.03 billion in 2026. Subsidy on underlying RP/RP-HPE/YP/APH policies declined modestly, from $6.67 billion to $6.23 billion, partly on lower projected prices. Most of the Midwest now shows combined ECO-plus-SCO shares of 30-50% of total premium subsidy. In Central and Northern Illinois, along the Iowa-Minnesota border and in parts of Ohio, the two products account for a majority of federal premium support, with shares between 50% and 75%.

Does a bigger subsidy mean a bigger benefit?

Not necessarily. Net producer benefit equals the subsidy transfer plus net indemnities — the program's performance in paying out. When the loss ratio (indemnities divided by premiums) equals one, subsidy and benefit coincide. Recent ECO and SCO loss ratios have fallen below one, meaning realized producer benefit trails the headline subsidy. ECO in particular has a short performance history, which limits what can be concluded. The products' rating is now pivotal, since it sets both the support flowing to each acre and the gap between that support and what producers actually receive.

What happens in 2027?

Structural changes take effect for the 2027 crop year. ECO's band narrows to 90-95%, while SCO will provide coverage from 90% down to the underlying policy's coverage level. ECO will trigger at the same level as before, but SCO will begin covering losses at a higher trigger point. All else equal, analysts expect ECO premiums to fall and SCO premiums to rise, which may shift participation and the distribution of federal premium subsidy between the two products.

Future loss experience, participation rates and rating decisions will determine how effectively this fast-moving, geographically concentrated channel of federal crop insurance support reaches growers across crops and regions.