We examine how wild pig expansion affects wildlife-related indemnification outcomes in the Federal Crop Insurance Program, emphasizing how deductible-based contract design mediates when damages trigger claims. We combine county-level crop
insurance records with spatial data on wild pig presence and crop area for major crops
in the southeastern United States over 2011–2023. Using a county-crop-year measure
of wild pig exposure based on cropover lap, we estimate fixed-effects models across
coverage levels. We find that wild pig exposure has little measurable effect at lower
coverage levels, but the relationship strengthens substantially as coverage rises. This
pattern suggests that higher deductibles mitigate the censoring effect of deductibles,
ensuring that a larger share of wildlife losses to trigger indemnities. Because many
wildlife damages remain below deductibles and many non-crop damages fall outside
insurance coverage, observed indemnities likely represent only the tip of the iceberg
relative to the much larger economic burden faced by producers. Our findings suggest that traditional crop insurance may be poorly suited to frequent, localized wildlife
losses relative to systemic production risks. Policymakers should therefore exercise caution when using indemnity data to assess invasive species damage and inform wildlife
management programs.
