Puckett's Corner

Home

About Us 

Ag Library

Bulletins

Crop Insurance Home

Crop Year 2008

Crop Year 2007

Feedback

FSA (loans, ldp, etc)

John Deere Risk Protection (cash markets)

National Crop Insurance Services

What's New (RMA)

Weather (moisture index)

Weather (palmer drought index)

The per acre yield produced by a unit. Actual yield is a combination of appraised unharvested production and bushels or pounds actually produced by unit at harvest time. Warehouse receipts, bin measurements, and appraisal worksheets can be used for documentation which needs to be kept at least three years in most cases.

APH yield is a yield based on crop units by practice and type and is used to establish insurance guarantees.  It is determined by averaging at least four consecutive yields for a unit. If four consecutive yields are not available, transition yields are used in the calculation of APH yield. Up to ten years of yields are used in determining APH yield.

The material for a specific crop year, which is available in your insurance agent’s office, and which shows the amount of insurance or production guarantees, coverage levels, premium rates, practices, insurable acreage, and other related information regarding crop insurance in the county.

Added Land 

Land on which the insured has not actively engaged in farming for a share of the crop's production on the unit for more than two APH crop years.

The 2007 Crop Insurance Handbook defines it as a level of coverage above Catastrophic Risk Protection.

Adjusted Gross Revenue (AGR)

A Policy that insures revenue of the entire farm rather than an individual crop by guaranteeing a percentage of average gross farm revenue, including a small amount of livestock revenue. The plan uses information from a producer's Schedule F tax forms, and current year expected farm revenue, to calculate policy revenue guarantee.

An amount you must pay for catastrophic risk protection, limited, and additional coverage for each crop year

An arrangement whereby you assign your right to an indemnity payment to any party of your choice for the crop year.

Base Price

The base price is used to calculate minimum revenue guarantees for revenue insurance products. Base prices are established by averaging settlement prices of different commodity  futures contracts in a set month on a set exchange.  The commodity exchange used depends on the crop, county, and state.  The time this price is set is during the month of February for most spring crops, or the period including part of August and the first part of September for winter wheat in this area of the country.

All acreage of the insured crop in the county on the date coverage begins for the crop year: 1) In which the insured has 100 percent crop share; or 2) Which is owned by one person and operated by another person on a share basis. (Example: If, in addition to the land you own, you rent land from five landlords, three on a crop share basis and two on a cash basis, you would be entitled to four units—one for each crop share lease and one that combines the two cash leases and the land you own.) Land which would otherwise be one unit may, in certain instances, be divided.

Buffer Zone

A parcel of land, as designated in your organic plan, that separates agricultural commodities grown under organic practices from agricultural commodities grown under non-organic practices, and used to minimize the possibility of unintended contact by prohibited substances or organisms.

The date specified in the Crop Provisions on which coverage for the crop will automatically renew unless canceled.  This is the date that you have to cancel by if you do not want coverage in the coming crop year.

Catastrophic Coverage (CAT) - pays 55 percent of the established price of the commodity on crop losses in excess of 50 percent. The premium on CAT coverage is paid by the Federal Government; however, producers must pay a $100 administrative fee for each crop insured in each county. Limited-resource farmers may have this fee waived. CAT coverage is not available on all types of policies.  The minimum level of coverage offered by FCIC that is required to qualify for certain other USDA program benefits unless you waive eligibility for emergency crop loss assistance in connection with the crop.

A claim you make for damage or loss to an insured crop.

Coverage level

Coverage levels are percentage choices made by farmers to establish a percentage of  APH yield that you want to have protection on.  These levels usually range from 50% to 85%.

The part of the policy that contains the specific provisions of insurance for each insured crop.

Crop Revenue Coverage (CRC)

An insurance program that guarantees a stated amount of revenue. CRC covers revenue losses due to a low price, low yield, or any combination of the two.  This policy type provides revenue protection based on price and yield expectations by paying for losses below the guarantee at the higher of an early-season price or the harvest price.

The period within which the insured crop is normally grown and designated by the calendar year the insured crop is normally harvested.

Date To File Notice of Crop Damage

After damage; the date the producer decides to discontinue caring for the crop; prior to the beginning of harvest; immediately, if farmer determines that the crop is damaged after harvest begins; or the end of the insurance period, whichever is earlier.

Debt Termination Date

This is the date insurance that the company will terminate a policy for nonpayment.  

Dollar Plan

The dollar plan provides protection against declining value due to damage that causes a yield shortfall. Amount of insurance is based on the cost of growing a crop in a specific area. A loss occurs when the annual crop value is less than the amount of insurance. The maximum dollar amount of insurance is stated on the actuarial document. The insured may select a percent of the maximum dollar amount equal to CAT (catastrophic level of coverage), or additional coverage levels.

Double Crop

Producing two or more crops for harvest on the same acreage in the same crop year.

The date upon which your crop insurance coverage ceases for the crop year.

Enterprise Unit

The date in the Special Provisions by which the crop must initially be planted in order to be insured for the full production guarantee or amount of insurance per acre.

The cultural practices generally in use in the county for the crop.  Practices required for the crop to produce at least the yield used to determine the production guarantee or amount of insurance. These practices are recognized by the Cooperative State Research, Education, and Extension Service as compatible with agronomic and weather conditions in the county.

Group Risk Plan (GRP) 

GRP coverage is based on an expected county yield for insured crops. These policies use a county index as the basis for determining a loss. When the county yield for the insured crop, as determined by National Agricultural Statistics Service (NASS), falls below the trigger level chosen by the farmer, an indemnity is paid. Payments are not based on the individual farmer's loss records. Yield levels are available for up to 90 percent of the expected county yield. GRP protection involves less paperwork and costs less than the farm-level coverage described above. However, individual crop losses may not be covered if the county yield does not suffer a similar level of loss. This insurance is most often selected by farmers whose crop losses typically follow the county pattern.

Group Risk Income Protection (GRIP)

This policy type makes indemnity payments only when the average county revenue for the insured crop falls below the revenue chosen by the farmer.  GRIP coverage is similar to GRP in that it's based on county-wide losses.  The difference is that GRIP protects you from a potential loss in revenue resulting from a significant reduction in yields or prices of a specific crop in your county.  Instead of trigger yields they are based on an established trigger revenue also calculated from county-wide statistics.  

Harvest price

Harvest price is not a farmer received price for grain.  It is a price established by a commodity exchange futures contract.  Different commodity exchanges are used dependent on crop and crop location.  The month the price is set is in the summer of the crop year but varies by month dependent on crop type and state location.

High Risk Land (HRL)

Land designated on a map in the actuarial documents with a high risk rate classification, requiring a higher premium rate due to higher risk.

HRL Exclusion Option

An agreement to exclude from crop insurance coverage ALL high risk land by crop and county, as signed on our form by the sales 
closing date. Catastrophic coverage is still available when this option is in effect. 

Income Protection (IP)

This policy type protects producers against reductions in gross income when either a crop's price or yield declines from early-season expectations. To determine coverage, see the policy provisions.

Payment made for a loss owed you from your insurance product. These payments could be for loss due to yield, quality loss, replant claims, prevented planting, or for dollar amounts below a revenue guarantee.  For APH or MPCI coverage which is insurance based on yield, indemnity payments occur when yield is below an APH guarantee. For revenue insurance, indemnity payments occur when revenue is below a revenue guarantee.

Ineligible Tracking System

The Ineligible Tracking System (ITS) is a database that contains records of producers who are not eligible to participate in any crop insurance programs insured or reinsured by the Federal Crop Insurance Corporation (FCIC). When a producer applies for crop insurance, the insurance company automatically checks the ITS for the producer's eligibility. If it is determined that the producer is ineligible, the producer will be notified and crop insurance coverage will not attach.

The period that begins the day after the final planting date for the insured crop and ends 25 days later, unless otherwise specified in the Crop Provisions or Special Provisions.

Coverage that is 50 percent or more, but less than 65 percent, of the approved yield indemnified at 100 percent of the expected market price (or a comparable coverage as established by FCIC).

(1) Direct or indirect gross farm sales not more than $100,000.00 in each of the previous two years (to be increased starting in fiscal year 2004 to adjust for inflation using Prices Paid by Farmer Index as compiled by National Agricultural Statistical Service (NASS)); and (2) A total household income at or below the national poverty level for a family of four, or less than 50 percent of county median household income in each of the previous two years (to be determined annually using Commerce Department Data). 

See http://www.nrcs.usda.gov/programs/smlfarmer_v2/help.htm for the actual dollar amount adjusted for inflation. The Limited Resource Self Determination Tool may be used to determine if an insured qualifies as a limited resource farmer. 

However, a person will be considered as a limited resource farmer if insured prior to the 2005 crop year, or for the 2005 crop year on a crop with a contract change date prior to August 31, 2004, and administrative fees were waived for one or more of those crop years because the insured qualified as a limited resource farmer under the limited resource farmer definition in effect at the time, and the insured remains qualified as a limited resource farmer under the following definition: a producer or operator of a farm with an annual gross income of $20,000 or less derived from all sources of revenue, including income from a spouse or other members of the household, for each of the prior two years. Notwithstanding the previous sentence, a producer on a farm or farms of less than 25 acres (aggregated for all crops), where a majority of the producer's gross income is derived from such farm or farms but the producer's gross income from farming operations does not exceed $20,000, will be 
considered a limited resource farmer. (For example, a producer farming 20 acres with a total gross income of $39,000, of which $20,000 is farm income and $19,000 is off-farm income, is a limited resource farmer.) 

Loss, notice of

The notice you must give the insurance company not later than 72 hours after certain losses or 15 days after the end of the insurance period, whichever is earlier.

Maximum protection level

A value set for each crop in each county where Group Risk Plan (GRP) insurance is available. This value is the maximum protection level available under GRP and Group Risk Income Plan (GRIP) insurance.

Any two or more tracts of land whose boundaries do not touch at any point. (Exception: Land separated only by a public or private right-of-way, waterway, or irrigation canal is considered contiguous.)

Optional unit

Optional units are divisions of a basic unit. When a basic unit is comprised of different sections, the basic unit can be divided into optional units, with all farmland in each section constituting a separate optional unit if the seeding pattern doesn't cross section lines. Optional units also may be designated for crops grown under irrigated and non-irrigated farming practices and located in the same section.

The agreement between you and the insurer, consisting of the accepted application, the Basic Provisions, the Crop Provisions, the Special Provisions, other applicable endorsements or options, the actuarial documents for the insured crop, the Catastrophic Risk Protection Endorsement (if applicable), and the applicable regulations published in the federal register.

Practical to Replant is based on all factors, including, but not limited to, moisture availability, condition of the field, time to crop maturity, and marketing window, that replanting the insured crop will allow the crop to attain maturity prior to the calendar date for the end of the insurance period. It will be considered to be practical to replant regardless of availability of seed or plants, or the input costs necessary to produce the insured crop such as those that would be incurred for seed or plants, irrigation water, etc. 

The earliest date upon which you will be billed for insurance coverage based on your acreage report. The premium billing date is in the Special Provisions.

Failure to plant the insured crop by the final planting date designated in the Special Provisions for the insured crop in the county. You may also be eligible for a prevented planting payment if you were unable to plant because of an insured cause of loss that is general in the surrounding area.

The prices contained in the Special Provisions or an addendum. They are used to compute the value per pound, bushel, ton, carton, or other unit of measure so that premium and indemnity can be determined.

The number of pounds, bushels, tons, cartons, or other unit of measure determined by multiplying the approved yield per acre by the coverage level percentage you elect.

A written record showing your annual production. The insurance company uses it to determine your yield for insurance purposes. The report contains yield information for previous years, including planted acreage and harvested production. This report must be supported by written, verifiable records from a warehouseman or buyer of the insured crop, by measurement of farm-stored production, or by other records of production approved by the insurance company.

Revenue Assurance (RA)

This policy type provides dollar-denominated coverage by the producer selecting a dollar amount of target revenue from a range defined by 65-75 percent of expected revenue. Similar to CRC this policy allows you to receive an indemnity payment when your gross revenue is below your revenue guarantee.  The Revenue Assurance policy allows you to select a harvest price option.

Replanting

Replacing the seed or plants of the same crop in the insured acreage with the expectation of producing at least the yield used to determine the production guarantee.

Portion of the insured crop that must remain in the field for examination by the insurance company’s loss adjuster when making a crop appraisal. In certain instances you may harvest the crop and leave only samples of the crop residue in the field.

Revenue Assurance (RA)

Protects a producer’s crop revenue whenever low prices or low yields, or combination of both, causes the crop revenue to fall below the guaranteed revenue level.

A date in the Special Provisions by which an application must be filed. The last date you may change your crop insurance coverage for a crop year.

Second Crop

With respect to a single crop year, the next occurrence of planting any Second Crop agricultural commodity for harvest following a first insured crop on the same acreage. The second crop may be the same or a different agricultural commodity as the first insured crop, except the term does not include a replanted crop. A cover crop, planted after a first insured crop and planted for the purpose of haying, grazing or otherwise harvesting in any manner or that is hayed or grazed during the crop year, or that is otherwise harvested is considered to be a second crop. A cover crop that is covered by FSA’s noninsured crop disaster assistance program (NAP) or receives other USDA benefits associated with forage crops will be considered as planted for the purpose of haying, grazing or otherwise harvesting. A crop meeting the conditions stated herein will be considered to be a second crop regardless of whether or not it is insured. Notwithstanding the references to haying and grazing as harvesting in the Basic Provisions, for the purpose of determining the end of the insurance period, harvest of the crop will be as defined in the applicable Crop Provisions. 

Your percentage of interest in the insured crop as an owner, operator or tenant. Your insurable interest attaches at the time of seeding.  However, only for the purpose of determining the amount of indemnity, your share will not be more than it was at the earlier of the time of loss or the beginning of harvest.  Your protection can not increase after the acreage reporting date.

The part of the policy that contains specific provisions of insurance for each insured crop that may vary by geographic area.

An interest of at least 10 percent in the insured crop.

The insurance company’s statement to you, based upon your acreage report. It specifies the insured crop and the guarantee or amount of insurance coverage provided by unit.

A person who rents land from another person for a share of the crop or a share of the proceeds of the crop.

The date in the Crop Provisions upon which your insurance ceases to be in effect because of nonpayment of any amount due the insurance company.

Transitional Yield (T-yield) 

An estimated yield provided in the county Actuarial Table which issued in calculating average/approved APH yields when less than 4 years of actual, temporary, and/or assigned yields are available on a crop by county basis.

Waiver of Administrative Fees

The administrative fee for CAT and Additional coverage may be waived for insureds who qualify as a limited resource farmer (3)(a) New insureds who wish to be exempt from paying administrative fees must request a waiver at the time of application (on or before the SCD). For carryover insureds, waiver requests must be made annually by the crop's final acreage reporting date.  The insured must provide proof of qualifying income OR CERTIFY on the request for waiver that he or she qualifies as a limited resource farmer. 

Whole farm unit

A whole farm unit consists of all insured farmland in one county (all crops are included in one unit). At least two of the insured crops must each constitute at least 10 percent of the total liability of all insured crops in the whole farm unit, and all crops in the unit must be insured under the same plan of insurance and with the same AIP. The election for whole farm unit needs to be in writing and take place prior to the sales closing date for the crops.

A document that alters designated terms of a policy as authorized under the Basic Provisions, the Crop Provisions, or the Special Provisions for the insured crop.