Anticipate crop insurance changes
Several changes to the federal crop insurance program are expected in 2013. For most, it’s good news. USDA’s Risk Management Agency (RMA) plans to fully implement the rate reductions for corn and soybeans that growers began to see in 2012. "We hope to have that done and in a November filing," says William Murphy, RMA administrator.
For most corn and soybean growers, this means a rate reduction. Crop insurance participation for corn and soybeans is at more than 75% because crop insurance is a much better buy than in 1988, when there was only 25% participation. Additionally, wheat, cotton, sorghum, potato and apple growers can all expect their rates to begin falling.
Changes Welcome. Previously, a yield history dating back to 1975 was used to determine rates. Once the policy changes are in effect, a 20-year yield history will be used. The new rates are designed to reflect advancements in technology, management and seed.
RMA will also offer a pilot program that allows producers to participate based on whole farm and enterprise units. The program will give producers increased coverage at the same price. This change has not yet gone out for comment, according to Murphy, but will soon. Murphy adds that farmers can expect to see two more changes for 2013, a high-risk land exclusion option and revenue protection for pulse crops.
The high-risk land exclusion option will allow producers who farm both high-risk and non-high-risk land to either insure the high-risk land under Catastrophic Risk Protection Endorsement coverage or exclude it from coverage altogether.
The Pulse Crop Revenue Plan of Insurance will be available to growers of dry beans in select Minnesota and North Dakota counties, as well as dry peas in select areas. Producers can check to see if they qualify by visiting www.rma.usda.gov. Growers must sign up for coverage by the sales closing date, which is generally March 15.
One thing is certain, experts say: More farmers will participate in crop insurance programs next year. That always happens after a disaster year, and probably for good reason.