Coverage Available: VP - a yield only type of coverage - RP - revenue based products. CAT is the lowest level of VP (a 50/55 level where the 50 is the percent of your average production guaranteed, and the 55 is the percent of the set price your loss would be paid at costs you $655 per crop per county (no matter how many acres of the crop) - CAT wasn't used much back when it was introduced at $50 per crop per county and now is used only in special cases - mainly a lot of acres in one county- it's something cheap. Buy-up is available with yield and/or revenue plans from 50°/4 through 85%, with premiums rising accordingly- something over 90% of our coverage is written as Revenue Protection.
Eligibility- Crop insurance is still available to basically everyone, but ....... The subsidy amounts which make it affordable, are not available unless you are in "Conservation Compliance" and have a current FSA form 1026 on file.
Perils - Crop insurance covers losses due to any act of God, and with revenue coverage, can help protect against crop price swings. Corn harvested as silage or high moisture, it must be appraised before harvest- whether you have a claim or not.
Counties: You "usually" have a separate policy for each county where you grow crops - this is governed by where the land is physically located, not which FSA office you report to ... With the advent of Enterprise units and the ability to lump multi-county coverage together ((MCEU) You still must insure all acres of a covered crop that are within the unit structure of your policy).
Unit Structure: BU (Basic Unit) all of the crop within the county is lumped together, -with CAT, BU is the only choice. OU (Optional Unit) means that you could insure farms or sections separately these must be set up before planting, and the premiums are significantly higher than BU - on smaller operations, the physical location or FSA farm numbering may limit your choices. EU (Enterprise Units) has become the selection of choice in recent years - largely due to the way they now price the premiums. EU lumps all of the crop into one unit - subjects to some minimum qualifying requirements. There are qualifying requirements for both OU and EU. We always try to quote all three choices. EU gets you the most bang for your premium dollars, even though you are not as likely to qualify for isolated farm by farm claims! With wide-spread conditions like this year's drought in central Ohio, it works great -you can ultimately have more coverage at the cheaper premium with EU coverage.
Timely Planting Dates: In Ohio 5 June for corn and 20 June for beans - oats are 1O May. Pa. uses 1O June for both corn and beans. You still have coverage for any of those crops planted after those dates, but ...your guarantees are reduced by 1o/o per day on those crops.
Replant Payments: All levels above CAT - pays 8 times corn price or 3 times bean price per acre -20/20 rule applies- must be 20% of the unit or 20 acres whichever is less for a payment. Supplemental replant coverage dollars can be added if it is a concern.
Prevented Planting (PP): If you are unable to plant, and it's a "general condition to the area", you can declare a prevented planting loss once we pass the timely planting dates. PP is included with all levels of coverage, and basically pays you around 60% of what your normal coverage would have paid on those acres. Same 20/20 rule applies, and even though "they" have continued to tweak the liability amounts, in many of our insured areas, it is a very valuable part of the coverage.
Billing: Premiums are quoted in terms of your actual cost on the actual number of acres you report as planted or PP - the Federal subsidy pays approx. 60% of the total premiums. No money is due up front, with premiums due 1 October for corn/ bean coverage - (recent economic and health issues have resulted in extension of the normal dates when interest would attach).
Most important insured responsibility: Acreage reporting must accurately reflect FSA acres" - not planter acres (work with FSA office if your acres don't agree!!) - it's great if the acres all match!
