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Before planting, farmers work with insurance agents to tailor insurance protection to fit their unique needs.
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Agents help farmers fill out paperwork and file needed production records to secure crop coverage from insurers.
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Private-sector companies enter into contracts with farmers to provide protection at rates set by the government.
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Farmers pay premiums from their own pockets – collectively $3.5 billion to $4 billion a year – for the risk management tool.
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If disaster strikes before the crop is harvested, farmers file claims as they would with any other insurance product.
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Claims adjusters, who work for insurers, meet with farmers and verify losses.
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Upon loss verification, insurers cut indemnity checks, minus policy deductibles, within 30 days.
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Because aid arrives in weeks, not months or years, farmers have the capital needed to pay back loans and plant again the next season.
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