This report offers a quick overview of the common terms and procedures associated with multi-peril crop insurance (MPCI). Your experienced Crop Growers insurance agent will work closely with you to answer your questions, choose a level of coverage and complete the application with you. Our goal is to offer you excellent service and the best risk management plan possible for your business.

Covered Perils

A multi-peril crop insurance (MCPI) policy covers production loss due to adverse weather conditions, insects and diseases. Some policies and options also cover quality. However, no policy covers production loss from poor farming practices, such as failure to spray crops.

Actual Production History (APH)

MPCI policies guarantee an amount of production based on the policyholder’s historical yields. That is, the average of the farmer’s last 4 to 10 years of actual production records. If you had years with low yields, you can elect a yield adjustment option, which is 60 percent of your county average yield. If you choose this option, you will be charged an additional 5 percent on your policy premium.

Unit Structure

To apply for MPCI, first divide your farm into units. This exercise is an important risk management tool since your production guarantee is based on units, not acreage or total farm. The types of units that you can identify are:

• noncontiguous land (someone else owns land in between your acreage)
• irrigated vs. nonirrigated land
• land with different farm serial numbers (check with USDA for your serial numbers)
• varietal groupings Note: Farms insured under the CAT level of coverage are allowed only one unit. Please refer to the crop provisions section of your policy to confirm that unit structure options apply to your industry.

Coverage Levels

You can select a level of coverage ranging from a minimum of 50 percent up to a maximum of 75 percent, increasing in 5 percent increments.

• Catastrophic (CAT) insurance guarantees 50 percent of your average yield and pays 55 percent of the government set market price. It offers no options and no units. The cost is just a $100 administrative fee, with no additional premium.
• All other coverage levels pay 100 percent of the established or projected market price, and allow farm units and options.

Premium Costs

The following chart shows that government subsidies make crop insurance very affordable. For example, if you select 50 percent coverage, the subsidy covers 67 percent of the premium, leaving you with just 33 percent of the premium to pay.

Guarantee

To determine your guaranteed production per unit, follow these steps:

1. Determine your number of units and types of units
2. Multiply your APH by the coverage level you select
3. Multiply the result of step 2 by the number of acres in each unit for the upcoming production year

Reporting Losses

• Call Crop Growers Insurance at 800.234.7012 within 72 hours of discovering the damage
• Continue to care for the crop until an adjuster talks to you and consents to alternatives
• Look over your guarantees and policy with your agent to ensure accuracy and to avoid discrepancies

Important Dates

Important dates for sales closings, acreage and production reporting may vary by state and by commodity. For a list of all the important dates by commodity, click here.

Multi-Peril Crop Insurance Facts

Click here for more information.

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