Analysis identifies need to educate wine grape growers on crop insurance issues

Abstract

A spatial analysis of variation in return on investment for crop insurance showed that West Coast wine grape growers are more inclined to use insurance to maximize short-term net returns than to protect against cash flow shortages. Growers would benefit from knowing that even if crop insurance does not maximize short-term net returns, it increases the revenue floor, thereby helping prevent cash flow shortages and vineyard failure. With crop insurance as the backbone of the U.S. agricultural safety net, an understanding of factors that drive variation in crop insurance participation can improve agricultural Extension agents' ability to offer programming on crop insurance issues. Additionally, agents can use publicly available data to replicate the analysis described in this article for other insured crops.