Multi Peril Crop Insurance
Individual Crop Policy
Revenue Protection (RP)
Revenue Protection (RP) provides protection against a loss of revenue caused by price increase or decrease, low yields or a combination of both. This coverage guarantees an amount based on the individual producer’s APH and the greater of the projected price or harvest price. Both the projected price and harvest price are established according to the crop’s applicable commodity board of trade/exchange as defined in the Commodity Exchange Price Provisions (CEPP.) While the revenue protection guarantee may increase, the premium will not. The projected price is used to calculate the premium and replant payment or prevented planting payment. An indemnity is due when the calculated revenue (production to count x harvest price) is less than the revenue protection guarantee for the crop acreage.
How does it work?
- Establishes a minimum guarantee of revenue per acre
- May select coverage with or without Harvest Price Exclusion
- To determine the Revenue Guarantee, RP will use the greater of the Projected Price or Harvest Price. RPHPE will use only the Projected Price
- For both plans, the indemnity payment is determined using the Harvest Price if revenue to count is less than final Revenue Guarantee, an indemnity is paid
Why should I get Revenue Protection?
- Protects against revenue loss caused by low yields and/or low prices, as well as higher fall prices
- Flexible and efficient management tool to crop producers
- Subsidized by the Federal Crop Insurance Corporation (FCIC)
- The Harvest Price increase is limited to 200% of the Projected Price
- There is no downward limit
- Coverage on basic, optional, enterprise, and whole-farm units where available
- Discounts for producers that insure multiple crops on whole-farm units
- Premium amount is determined using the Projected Price
- The premium will not increase even if the Harvest Price is higher than the Projected Price
Additional Coverages
- Late Planting Coverage: May provide additional time to plant crops when conditions prevent timely planting.
- Prevented Planting: May allow for payments when insurable causes of loss prevent you from planting your crops.
- Replant Provisions: May provide an additional payment for the extra expenses involved when it is practical to replant and the acreage qualifies.
What does it cost?
Per-acre premiums will depend on the county of the insured crop, unit structure, the crop’s APH yield, and price elections. Higher coverage levels and higher elected prices result in higher premiums.
Revenue Protection with Harvest Price Exclusion (RP-HPE)
Revenue Protection with Harvested Price Exclusion (RP-HPE) is similar to RP, however RP-HPE coverage provides protection against loss of revenue caused by price decrease, low yields or a combination of both. Unlike RP, the revenue protection guarantee for RP HPE is based on the projected price only and it does not increase based on the harvest price. If the harvested production plus any appraised production multiplied by Harvest Price is less than the amount of insurance protection, the insured is paid an indemnity based on the difference.
Yield Protection (YP)
Yield Protection (YP) provides protection against a loss in yield due to unavoidable, naturally occurring events. For most crops, that includes adverse weather, fire, insects and plant disease. YP guarantees a production yield based on the individual producer’s APH. A price for YP is established according to the crop’s applicable commodity board of trade/exchange as defined in the Commodity Exchange Price Provisions (CEPP.) The projected price is used to determine the yield and to value the production to count less than the yield protection guarantee.
How does it work?
- Establishes a guarantee of bushels per acre
- YP Projected Price is determined by futures contracts, and APH price is established by the Federal Crop Insurance Corporation (FCIC)
- Pays an indemnity if the production to count falls below the yield guarantee
Why should I get Yield Protection?
- Offers a competitive premium
- Subsidized by the Federal Crop Insurance Corporation (FCIC)
- Protection against production loss
- Based on a producer’s own production history
- Provides coverage levels ranging from 50% to 85% of the APH in 5% increments
- Provides coverage on basic and optional units
- Enterprise and whole-farm unit coverage is available in some areas
- 60-100% coverage of the projected or RMA price
Additional Coverages
- Late Planting Coverage: May provide additional time to plant crops when conditions prevent timely planting.
- Prevented Planting: May allow for payments when insurable causes of loss prevent you from planting your crops.
- Replant Provisions: May provide an additional payment for the extra expenses involved when it is practical to replant and the acreage qualifies.
What does it cost?
Per-acre premiums will depend on the county of the insured crop, unit structure, the crop’s APH yield, and price elections. Higher coverage levels and higher elected prices result in higher premiums.
Area Crop Policy
Area Revenue Protection (ARP)
ARP is a subsidized county-based revenue protection policy and protects against loss of revenue due to a decline in commodity prices, a county-level yield loss, or a combination of the two. Policy formerly known as “GRIP”. This policy is not based upon an individuals APH or the production of the individual producer. ARP utilizes the greater of the Projected or Harvest Price. Coverage levels are available to protect up to 90% of the County’s Expected Yield and 120% of the Projected (Spring) Price. Indemnity payments are triggered if the Final County Revenue is less than Final Revenue Guarantee for the County, which is found by taking the greater of the Projected or Harvest Price.
Area Revenue Protection – Harvest Price Exclusion (ARP-HPE)
ARP-HPE excludes the Harvest Price option, which means only the Projected (Spring) Price is used for revenue guarantees on a county-level basis.
Area Yield Protection (AYP)
AYP is a county-based policy that only protects against loss of yield based on the Expected County Yield. This policy only indemnifies a producer on a county-level loss, not an individual production. This policy also does not provide any price protection.
Margin Protection (MP)
MP provides coverage against increased input costs and/or reduced commodity prices or county yields that would ultimately put a negative impact on a producers operating margin. County-based policy that can provide a band of coverage above and in combination with a Revenue Protection (RP) policy up to 95%. This policy has a Price Discovery period from August 15 – September 14th and a Sales Closing Date of September 30th. A producer needs to remember that Margin Production is not an individual policy or based on individual yields, however is based on the Final County Yield. An indemnity payment is made when a large enough decrease in county revenue and/or an increase in input costs causes the deductible for the policy to be met.
Non-Discrimination Statement
The U.S. Department of Agriculture (USDA) prohibits discrimination against its customers, employees, and applicants for employment on the bases of race, color, national origin, age, disability, sex, gender identity, religion, reprisal, and where applicable, political beliefs, marital status, familial or parental status, sexual orientation, or all or part of an individual’s income is derived from any public assistance program, or protected genetic information in employment or in any program or activity conducted or funded by the Department. (Not all prohibited bases will apply to all programs and/or employment activities.)
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