Acreage Reporting Date (ARD)
- This is the final date the insured is required to submit acreage reports, if not submitted no insurance will be in effect
- Accurate documentation must be reported by the insured:
- Amount of insurable and uninsurable acres in the county
- Date the acreage was planted
- Share in the crop
- Acreage location
- Farming practices used (irrigated or non-irrigated)
- Types or varieties planted
Actual Production History (APH)
- Provides protection against the loss of crop production due to a natural occurring event
- Guarantees the producer a yield based on their production history
- The guarantee is calculated by multiplying the producer’s average by the level of coverage
- An indemnity is due when the value of the production to count is less than the liability
Basic Units (BU)
- Crop – each insured crop is entitled to a separate basic unit
- County – each county is a separate basic unit
- CAT policies are eligible for BUs only
Buy-Up Coverage
- Crop insurance coverage that exceeds the CAT level
- Coverage is available up to 75% or 85% of your average yield, depending on the crop
Cancellation Date
- Last day to request cancellation of a policy for the next year
Catastrophic Risk Protection (CAT)
- Crop insurance coverage at the lowest, or catastrophic level
- Set at the 50/55 level, meaning that your yield must fall below 50% of your average yield before a loss is paid
- Losses are paid at a rate of 55% of the highest price election
Coverage Levels
- An insured in required to select the coverage level which a crop is to be insured at
- Some crops require all acreage of the crop to be insured at the same coverage level
- An insured can elect coverage levels by irrigated and non-irrigated practices as long as they are offered in the actuarial documents
- Both irrigated and non-irrigated practices must be insured at the buy-up level
Debt Termination Date
- Day the insurance company will terminate a policy due to nonpayment
End of Insurance Period
- Insurance coverage ends on this date
Enterprise Unit (EU)
- A single unit consisting of all of the insured’s insurable acreage for the insured crop in the county – regardless of share, location, FSA Farm Serial Number assigned or practice
- Combines all of a producer’s basic or optional units
Enterprise Units by Practice
- Separate enterprise units for irrigated and non-irrigated acreage can be established
- Each irrigated and non-irrigated acreage must separately quality for EUs
- One EU will be established for all irrigated acreage of the insured crop in the county and one for all non-irrigated acreage of the insured crop in the county
Federal Crop Insurance Corporation (FCIC)
- Established policy provisions, rules, regulations and rates
- Subsidizes premiums and provides reinsurance and administrative and operating reimbursement to AIPs
Final Planting Date (FPD)
- The date the crop must initially be planted in order to be insured for the full production guarantee or amount of insurance per acre
Guarantee
- A promise of payment
- The amount of money you will be paid in the event of a loss, according to the terms of your crop insurance contract
Harvest Price
- A price determined in accordance with the Commodity Exchange Price Provisions and is used to value production to count under revenue protection
Indemnity
- The money you receive for qualifying losses paid under an insurance policy
- Compensation for losses that exceed the deductible, up to the level of the insurance guarantee
Multi-Peril Crop Insurance (MPCI)
- Provides policies that cover multiple naturally occurring perils
- MPCI protects against crop yield losses by allowing producers to insure a certain percentage of historical crop production
- Must be purchased prior to the Sales Closing Date
Optional Units (OU)
- Crop acreage that would otherwise be one basic unit may be divided into optional units:
- By section or FSN
- By irrigated and non irrigated practices
- For acreage insured under an organic farming practice
- By Written Unit Agreements
- By Unit Division Option
Payment Due Date
- Last day to pay the premium without interest accruing
Premium
- The amount of money you pay for risk protection
- Option buyers pay a premium to option sellers for options contracts
Prevented Planting (PP)
- The failure to plant the insured crop with proper equipment by the final planting date or by the end of the late planting period
- The insured must have been prevented from planting the insured crop due to an insured cause of loss that is general in the surrounding area and that prevents other producers from planting acreage with similar characteristics
Production Reporting Date (PRD)
- PRD falls 45 calendar days after the SCD, unless otherwise noted in the Special Provisions
- PRD is the final date the prior year’s production and acreage may be reported
Revenue Protection (RP)
- A plan of insurance that provides protection against loss of revenue due to a production loss, price decline or increase, or a combination of both
- If harvest price exclusion is elected, the insurance coverage provides protection only against loss of revenue due to a production loss, price decline, or a combination of both
- Revenue production guarantee (per acre) is, for revenue protection only, the amount determined by multiplying the production guarantee (per acre) by the greater of the projected price or harvest price
- If the harvest price exclusion in elected, the production guarantee (per acre) is multiplied by the projected price
- An indemnity is due when that calculated revenue is less than the revenue protection guarantee for the crop acreage
Risk Management Agency (RMA)
- Oversees Federal Crop Program
- Sets rates and determines which crops can be insured in different states and counties
Sales Closing Date (SCD)
- Insurance applications much be signed and filed no later than the SCD specified in the crop actuarial documents
- SCD is the final date to make changes to existing crop insurance policies
Stacked Income Protection Plan (STAX)
- Coverage plan only available on Upland Cotton which provides area-based coverage for a portion of expected area revenue
- Indemnity is triggered if the actual county income falls below the area loss trigger selected by the policy holder
- Indemnity amount will be up to 20% of the expected county income
- Additional coverage will be needed in cases of deeper loss
Subsidy
- Money given by the government to help producers function
Substantial Beneficial Interest (SBI)
- Anyone who has a 10% or more interest in the insured entity/person is considered to have an SBI
- All SBIs must be reported along with their SSN or EIN
- The spouse of an individual will be considered to have an SBI in the applicant or insured unless they can prove they are legally separated under state law
Supplemental Coverage Option (SCO)
- An endorsement (to YP, RP, and RP-HPE) which provides area-based coverage for a portion of the insurance deductible
- An indemnity is due if the county yield/revenue falls below 86% of the expected yield/revenue
Transitional Yields (T-yields)
- Estimated average yields for the county depending on the type, practice and map area within the county
- The main purpose is to establish a database in which fewer than four actual or assigned yields exist and develop an approved APH yield and production guarantee
Trend Adjustment (TA)
- Adjusts eligible yields to reflect long term increases in the county’s historical yield
Whole-Farm Revenue Protection (WFRP)
- Provides a risk management safety net for all commodities on the farm under one insurance policy
- Tailored for any farm with up to $8.5 million in insured revwnue, including farms with specialty or organic commodities (both crops and livestock)
Yield Adjustment (YA)
- Allows producers to substitute 60% of the applicable T-Yield for actual yields that are less than 60% of the applicable T-Yield to mitigate the effect of catastrophic years
Yield Exclusion (YE)
- Allows for the exclusion of actual yields for any crop year where RMA determines the county per planted acre yield for that crop year was at least 50% below the simple average per planted acre yield for the crop in the county for the previous 10 consecutive crop years
- Allows producer to receive a higher approved yield on their insurance policies by removing eligible yields from their databases
Yield Floor
- A percentage of the applicable “T Yield” based on the number of years of records the insured has provided for the crop and county
Yield Protection (YP)
- A plan of insurance that only provides protection against a production loss due to unavoidable naturally occurring events
- Yield protection guarantee (per acre) is the amount determined by multiplying the production guarantee by the projected price
- An indemnity is due when the value of the production to count is less than the yield protection guarantee