CROP INSURANCE: RISKS, LOSSES, ETC. 17 
of- policy. The amount of insurance was fixed at the relatively low 
figure of $7 an acre and the insurance applied to a specified field area, 
the crops on which might include any or all of the following grains — 
wheat, flax, rye, oats, barley, and spelt. In case of total failure of 
the crop on such area, the company agreed to pay the face value of the 
policy, or $7 an acre. In the event of partial loss, the indemnity pro- 
vided for was equal to the difference between the value of the crop 
harvested on the field area insured and the face of the policy, it being 
specifically stipulated that the entire area insured in a given policy 
should be considered a single risk. Furthermore, the partial crop 
was valued at prices stipulated in the policy, namely, wheat, $1; 
flax, $1.75 ; rye, 70 cents ; and oats, barley, and spelt, 50 cents a bushel. 
The insurance, therefore, even though written in terms of money, 
covered yield rather than returns on a monetary basis. In other 
words, the insured was protected in a measure against crop damage, 
but not against a possible drop in the prices of the crop produced. 
Adjustment of all partial losses was necessarily postponed until after 
the insured crops had been thrashed. 
These first attempts at general crop insurance proved rather 
disastrous for the companies that undertook them, owing, in part, to 
the severe drought that occurred in large sections of the States 
mentioned and, in part, to inadequate safeguards by the companies 
against the assumption of risks after severe damage had already 
taken place. The losses incurred under these contracts were to a 
considerable extent repudiated by the companies. Inability to settle 
in full was pled. In some cases fraud on the part of the insured 
was alleged and many claims were tentatively settled by the return of 
the premium collected. The outcome of this first attempt to provide 
a general crop coverage is much to be regretted. 
For two years following these experiments of 1917, no general 
crop insurance, so far as the author is aware, was written in the 
United States. . During the last two years, however, the plan of 
offering a crop insurance contract has been revived, at least two of 
the larger fire insurance companies having written such contracts. 
One of these policies, which was written by one of the two com- 
panies quite extensively during 1920, in effect guarantees the farmer 
a specified income from each acre insured unless damage results from 
fire, hail, wind, tornado, failure of the seed to germinate, or failure 
on the part of the farmer properly to do his part in seeding, culti- 
vating, or harvesting the crop. Losses or damage through the ele- 
ments, including frost, winterkill, flood, and drought, and from 
insects or disease are specifically covered by the policy. 
The amount of insurance to the acre written is based on the in- 
vestment in the crop as determined by allowing a fixed amount for 
each process in preparing for, cultivating, and harvesting the crop 
