Crop Insurance

Margin Protection (MP) provides you with coverage against an unexpected decrease in your operating margin (revenue less input costs).  MP is area-based, using county-level estimates of average revenue and input costs to establish the amount of coverage and indemnity payments. Because MP is area-based (average for a county), it may not reflect your individual experience. A payment may be made when the harvest margin for the county is lower than the trigger margin due to a decrease in revenue and/or an increase in input costs. MP may cover a portion of that shortfall. 

MP can be purchased by itself, or in conjunction with a YP or RP policy purchased from the same approved insurance provider. 

A few benefits: 

• County based plan, but you keep the individual protection of your selected revenue or yield protection plan. 
• Has a different price discovery period than your base plan
• Ability todiversify your risk management portfolio, giving you more comprehensive coverage for your business. 

Yield Protection (YP) protects against a production loss for crops for which revenue protection is available but was not selected. YP even provides prevented planting and replant protection.  

A few benefits: 

• Gives you confidence to do pre-harvest crop sales to improve profits.
• Provides stability for long-term business plans
• May result in improved risk and financial management.
• May be viewed more favorably as loan collateral.
• Can act as a cash flow safety net

Enhanced Coverage Option (ECO) provides additional area-based coverage for a portion of your underlying crop insurance policy deductible. With ECO, you can add an additional band of coverage of your approved yield. It works in conjunction with your underlying multi-peril policy so it must be purchased as an endorsement to the YP, RP, Revenue Protection with the Harvest Price Exclusion, Actual Production History or Yield Based Dollar Amount of Insurance policy 

ECO follows your underlying policy — covering revenue with RP and yield with YP. While your underlying policy pays losses individually, ECO pays on an area basis. An indemnity is triggered when there is a decrease in the county level yield or revenue, again depending on the underlying plan. 

A few benefits: 

• Subsidized coverage 
• Covers shallower losses 
• Doesn’t affect your farm program election through FSA

Supplement Coverage Option (SCO) is a continuous endorsement to either a YP, RP or Revenue Protection with the Harvest Price Exclusion (RPHPE) policy. For crops that do not have revenue protection plans, SCO is also available as an endorsement to the Actual Production History (APH) policy. 

SCO works on an area-basis. That means a loss is triggered when there is a county level loss in revenue or yield. Your amount of SCO coverage depends on the liability, coverage level and approved yield of your underlying Multi-Peril Crop Insurance (MPCI) policy. It must be elected by your underlying (MPCI) policy’s sales closing date.  

Pasture, Rangeland and Forage (PRF) is a federal crop insurance program that insures against a lack of rainfall for your grazing or haying acres and provides protection from increased feed costs due to forage losses. Unlike other MPCI programs, lack of precipitation is the only covered cause of loss. Also, unlike other MPCI programs, you can choose which acres to insure. 

A few benefits: 

• Customizable coverage level and productivity factor
• No premium up front
• Timely loss payments at the conclusion of each index interval
• Part of the USDA subsidized federal crop insurance program
• Area based – not measured by individual operation rainfall
• Notice of loss automatically filed based on insured area

Actual Production History (APH) policies insure producers against yield losses due to natural causes such as drought, excessive moisture, hail, wind, frost, insects and disease.  

A few benefits: 

• Confidence for pre-harvest crop sales
• Stability for long-term business plans 
• Improved risk and financial management
• Cash flow 
• Safety net 

Area Revenue Protection (ARP) is an area-based revenue insurance program that provides protection against widespread loss of revenue in a county. ARP does not provide coverage for prevented planting or replanting. 

Individual farm revenues and yields are not considered under ARP, and it is possible that your individual farm may experience reduced revenue or reduced yield and not receive an indemnity under ARP. 

A few benefits: 

• If you have land scattered throughout the county, ARP may be beneficial as it covers a reduction in the average county yield or commodity price. 
• Offers upside price protection by valuing lost bushels at the harvest price.

Area Yield Protection (AYP) provides protection against loss of yield due to a county-level production loss. A loss payment triggers when the county average yield in a given year falls below the trend adjusted average yield by a greater percentage than the insured’s selected deductible. AYP does not provide coverage for prevented planting or replanting.   

AYP could be beneficial if you have land scattered throughout the county because it covers a reduction in the average county yield. 

The Stacked Income Protection Plan (STAX) is a crop insurance product for upland cotton that provides coverage for a portion of the expected revenue for your area. Most often your area will be your county; however, your area may include other counties or even practices as necessary to obtain a credible amount of data to establish an expected yield and premium rate. STAX may be purchased on its own, or in conjunction with another policy referred to as a “companion policy.” Companion policies may include YP, RP, RPHPE or any other ARP policies. 

Crop-Hail (CH) coverage provides protection against physical damage from hail and/or fire. Other coverages provided include fire department service charges, transit coverage to the first place of storage, catastrophe loss award and replanting coverage. Options exist in some areas for other perils, such as wind and theft. CH can be used along with MPCI or other comprehensive coverages to offset the MPCI deductible and provide protection up to the actual cash value of the crop. Coverage is provided on an acre-by-acre basis, so damage that occurs on only part of a farm may be eligible for payment when the rest of the unit remains unaffected. 

Green Snap is available for field corn, seed corn, and sweet corn, providing coverage for severing or breaking of the stalk at a node above the brace roots and below the year as a result of natural wind.

Wind coverage is available for stalks severed below the ear or flattened/bent and unable to be harvested (Wind includes Green Snap). 

Coverage for extra expense when harvesting stalks that have been blown over (must be damaged according to policy language and limits).  Extra harvest expenses are paid on harvested acres only and can be added to a Wind policy, Green Snap policy or stand-alone hail policy with added rate. 

Revenue Price Option (RPO) with Market Coverage Option (MCO) is a coverage option exclusively available through Rain and Hail that allows you to insure your corn and soybeans at a higher price than what is available under your RP policy.  

More about RPO with MCO: 

• The policy must be purchased by the sales closing date of the underlying RP policy.

Field Grain Fire insures the standing grain crop against direct loss by fire, lightning and removal from premises endangered by these perils.  

Coverage Situations: 

• Field growing crops 
• Harvested crops to first place of storage 
• Optional: Harvested crop in storage and transit coverage from original storage site to normal selling point

The Hay Fire program protects your hay stored in the open or in buildings or structures against direct loss by fire, lightning and removal from premises endangered by these perils.  

Coverage Situations: 

• Stacks, chopped hay, baled hay, and cubed hay 
• Hay located in open areas, buildings or structures 
• Excludes growing hay
• Dollars per ton (actual value) 
• Maximum $100,000 per stack
• Loss of hay due to windstorm, collision, overturn and collapse of bridges, docks or culverts while the hay is being transported 
• Loss of fencing surrounding the hay 
• Fire department service charges 
• Theft and vandalism

The Pasturage Fire program provides coverage to pasturage against direct loss by fire, lightning and by removal from premises endangered by these perils. All insurable pasturage at any one location must be insured. A location is defined as the section identified in the Schedule of Insurance. The insured acreage must be located in an area which has some type of fire protection service provided by local, county, state, federal or private agencies. Land not serviced by some type of organized fire protection will be uninsurable. 

Add dollars to a qualified replant above what the underlying RP or YP policy pays. Replant Extra provides coverage for damage to the insured crop(s) caused by an insured peril to the extent that replanting is necessary as outlined in the underlying policy. 

Note: There are state-specific guidelines, check with your agent for how Replant Extra works in your area.

Revenue Plus (RVP) is a private endorsement product that provides additional revenue coverage for the same crop(s) and county(s) insured under the RP plan of insurance. RVP guarantee (per acre) is the amount determined by multiplying the revenue protection guarantee (per acre) by your RVP coverage percentage. 

A few benefits: 

• Pays for a yield or revenue loss. 
• Triggers a loss payment whenever there is a revenue loss payable on the underlying RP policy.