House Bill No. 7038 mandates the Insurance Commissioner, in collaboration with the Commissioner of Agriculture, to conduct a feasibility study on the establishment of a captive insurance company or the use of parametric insurance to provide financial assistance to farmers affected by severe weather. The bill defines "parametric contract" in accordance with existing law and requires the Insurance Commissioner to report findings and recommendations to the relevant joint standing committees of the General Assembly by February 1, 2026.

The bill incurs a one-time cost of $55,000 to $65,000 to the Insurance Fund for the fiscal year 2026, primarily for hiring a contractor to complete the study. There are no anticipated ongoing fiscal impacts beyond this initial expenditure. The act is effective upon passage and introduces new legal language to current statutes without deleting any existing provisions.