Are ECO and SCO Worth Considering in 2026?

In February of this year I wrote an article about whether or not the Enhanced Coverage Option (ECO) was worth adding to your crop insurance coverage. When I looked at the data for 2017 through 2023, ECO needed to pay out in full around once every five years in order for the indemnities to break even with the premium cost. 

Since then, the One Big Beautiful Bill Act increased the subsidies for ECO and the Supplemental Coverage Option (SCO) from 65% to 80%. This change effectively reduces the farmer paid premium for area based coverages by more than 40%.  Additionally, last year (2024) was particularly brutal in the southeast and resulted in significant ECO and SCO payments for many crops and counties.  This additional data point along with the increased subsidies make area based coverages more attractive moving forward.

When I look back at my Union County, NC Case Study, ECO only needs to pay out once in 10 years to cover the premium, and the lowered cost means less strain on annual budgets.  If I apply the estimated higher subsidy premium to the 2017-2024 data, you can see a significantly more favorable loss to premium ratio.

Comparison of ECO aggregate estemated losses and premiums from 2017-2024

I stand by the conclusion in my February article that exuberance for ECO and other county level coverage like SCO may be missing the forest for the trees.  I like to group the various insurance products into either a Protection Category that bases indemnities on the growers production, or a Speculative Category that bases payments on factors beyond the scope of the growers personal operation like ECO and SCO.

Your first goal with Crop Insurance should be to use the resources in the Protection Category to make sure you have enough coverage to get to next year in a season where it doesn’t rain.  Once you’ve secured that stability you can start looking at the Speculative Category that may provide additional cash infusions as long as there is room left in your budget.

Foothills Crop Insurance is a family owned insurance agency with over 85 years of combined experience. We’re experts in tailoring policies to fit grower's operation and budget. Contact us today, and let our family take care of you like you’re one of us!  800-660-8674