JDRP Ethanol Policy:
JDRP offers industry first Ethanol Policy. Contact Svennes Crop Insurance to learn more.
JDRProtector Crop-Hail Insurance:
This policy provides insurance for loss or damage to growing crops caused by hail or other perils. JDRProtector is a concept of combining hail coverage and MPCI coverage, with the convenience of a single statement and processing system offered through John Deere Risk Protection (JDRP).
Benefits
- Fire and Lightning Damage
Coverage for damage before and during harvest and while your crop is in the harvester. This also includes crops in small grain stubble.
- Vandalism and Malicious Mischief
Coverage for damage before and during harvest and while your crop is in the harvester.
- Fire Department Service Charge
Payment up to $500 when the fire department is called to save or protect your insured crop.
- Unlimited Transit
Unlimited mileage coverage for damage to your crop from transit accidents.
- County Blanket
We insure all acres of your crop in a county.
- Coverage for Substitute Crops
Prior to receipt of the insured’s coverage amendments for the subsequent crop year, we will automatically insure his/her MPCI insurable crop not grown the previous crop year.
- Replant payment alternative
If an insured hail event occurs, requiring the grower to replant the crop, the grower has the option of choosing between indemnification for:
1. The actual cost to replant, up to 20% of the limit of insurance – and no reduction of limit for the subsequently replanted crop.
2. Replanting at their own expense, and collecting indemnity based on actual lost crop.
- Premium Waiver for Accidental Death*
For loss of life by accidental means while carrying out your farming operation.
- Stored Crop Coverage
Covers injury, deterioration or diminution of harvested grain while in storage and caused by events such as fire, hail, windstorm or flooding.
Crop-Hail Insurance Example
Situation: Loss of production due to hail
Hail plan: DXS5 (5% deductible plan, disappearing at 25%)
Acres: 100
Insurance per acre: $350
Limit of insurance: $35,000
Gross loss percentage: 20%
Net loss percentage: 18.75%
Gross % Net %
10% = 6.25%
20% = 18.75%
25% = 25%
72% = 73%
Indemnity Payment:
Limit of insurance ($35,000) x Net loss percentage (18.75%) = $6,563
*Not Available in Kansas.
Note: Policy provisions supersede information noted
Revenue Assurance:
Similar to CRC, a Revenue Assurance (RA) 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 with more unit structure alternatives available. Your agent can help you evaluate the best policy for your operation.
Overview
- Guarantees revenue per acre, with comprehensive protection against weather-related losses and certain other unavoidable perils, including low crop prices.
- Protects against low prices, low yields, poor quality, late planting,1 replanting costs2 or when planting is prevented.
- Available for basic, optional, enterprise or whole farm units.
- Harvest Price Option, if selected, allows for the revenue guarantee to be based on the higher of harvest prices or pre-planting estimated prices, offering added protection if prices go up at harvest.
Benefits
- Bottom-line revenue guarantees for more security in marketing.
- Harvest Price Option can be used to offset effects of high harvest prices on insurance guarantee and marketing.
- Provides income guarantee for bank loans.
- Prices are set using regional commodity exchanges to more closely reflect price differences.
Loss Triggers
The basic RA policy pays when actual revenue is less than revenue guarantees; high harvest prices may result in lower indemnity payments. With the addition of the Harvest Price Option, the greater of the harvest price or the projected price is used to calculate your guarantee.
RA Example
Situation: Harvest price is above projected price.3
Revenue Guarantee:
(APH (180 bu.) x Level (.65) x Projected Price ($2.23) = $260.91/Acre
Final Revenue Guarantee:
(APH (180 bu.) x Level (.65) x Harvest Price ($2.80) = $327.60/Acre
Harvest Price: $2.80
Yield: 90 bu./Acre
RA with Harvest Price Option (HPO)
Your Indemnity Payment:
Final Revenue Guarantee ($327.60) – Harvest Revenue ($252.00) = $75.60/Acre
RA without Harvest Price Option (HPO)
Your Indemnity Payment: Revenue Guarantee ($260.91/Acre) – Harvest Revenue ($252.00/Acre) = $8.91/Acre
1Subject to crop policy provisions.
2Not available on all crop policies.
3All examples assume the policyholder has 100% share of the insured crop.
GRIP:
Group Risk Income Protection (GRIP) coverage is similar to GRP in that it’s based on countywide 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 the “trigger yield” used for GRP policies, GRIP policies are based on an established “trigger revenue,” also calculated from countywide statistics. If you purchase a GRIP policy and the average revenue for your county fall below your “trigger revenue,” you may be eligible for a loss payment. Purchasing the GRIP Harvest Revenue Option allows the ability to increase the revenue guarantee in the event prices increase in the fall.
CRC:
A revenue policy such as Crop Revenue Coverage (CRC) provides protection against lost revenues caused by low yields, low prices, or both. As an integral part of your marketing program, a CRC policy insures your profitability, not just your expenses. You can market your crop during the growing season, when prices are usually higher, knowing that you have the revenue guarantee to cover bushels committed in forward pricing or other market options. You have an established revenue guarantee per acre, and, unlike a pure yield-based crop insurance policy, you may net a higher indemnity payment.
Overview
- Guarantees revenue per acre with comprehensive protection against weather-related losses and certain other unavoidable perils, including crop price reductions.
- Protects against low prices, low yields, poor quality, late planting,1 replanting costs2 or when planting is prevented.
- Final guarantee set at the higher of the minimum guarantee set at planting, or the harvest guarantee.
Benefits
- CRC adds more security to your marketing plans by guaranteeing both upside and downside revenues, with a minimum revenue guarantee.
- Calculates losses based on the harvest market price, to help protect your revenue and satisfy your contracts despite low yields.
- Provides a bottom-line revenue guarantee for operating loans.
- Prices set using regional commodity exchanges to more closely reflect area price differences.
- Available for corn, grain sorghum, cotton, rice, soybeans and wheat.
Loss Triggers
Pays when harvest revenue is less than final revenue guarantee.
CRC Example
Situation: Loss of production, higher prices at harvest.3
Projected Crop Price: $2.23
Final Revenue Guarantee:
(APH (180 bu.) x Level (.65) x Harvest Price ($2.80) = $327.60/Acre
Harvest Price: $2.80
Yield: 90 bu./acre
Value of Production: Yield (90 bu.) x Harvest Price ($2.80) = $252.00/Acre
Indemnity Payment: Final Guarantee ($327.60) – Production Value ($252.00) = $75.60/Acre
1Subject to crop policy provisions.
2Not available on all crop policies.
3All examples assume the policyholder has 100% share of the insured crop.
MPCI:
With Multiple-Peril Crop Insurance (MPCI), you can purchase coverage to guarantee yields based on your actual production history (APH). MPCI provides protection against losses for most crops from nearly all natural disasters. Less expensive than revenue-based policies, an MPCI policy protects against yield and/or quality losses from many different perils, including drought, excess moisture, cold and frost, wildlife, disease and insects. Various levels of coverage are available.
Overview
- Comprehensive protection against weather-related causes of loss and certain other unavoidable perils.
- Protects against low yields, poor quality, late planting, replanting costs or when planting is prevented.
- Guarantee is based on producer’s own yield records.
Benefits
- Provides a source of income when low crop yields are caused by covered perils.
- Adds security to farm loans and low-level security for marketing plans.
- Minimum Catastrophic coverage is available, and provisions are available for limited-resource farmers.
- Available on a wide variety of crops.
Loss Triggers
Pays when the actual yield falls below the approved guarantee. Losses paid at Federal Crop Insurance Corporation (FCIC) determined price on policy.
MPCI Example
Situation: Loss of production due to drought.*
Actual Production History: 180 bu.
Coverage Level: 65%
Actual Yield: 90 bu.
Market Price: $2.05
Guarantee: APH (180 bu.) x Level (.65) = 117 bu.
MPCI Payment: Guaranteed (117) – Actual Yield (90) = 27 bu. deficit x MP ($2.05 )= $55.35/Acre
GRP:
When farmers throughout your county face yield losses, chances are you face losses too. So, unlike crop insurance policies written based on your actual yields, Group Risk Plan (GRP) coverage is based on an expected county yield for insured crops. The expected county yield is calculated annually, using years of data from the National Agricultural Statistics Service (NASS). You select a coverage level and a dollar amount of insurance per acre. You don’t need to supply information about your own average yields, just the number of acres you’re planting, your share in the crop, and which crops are being planted. A “trigger yield” is calculated for your policy by multiplying the average county yield by the coverage level you select (from 70% to 90% of expected county yield). Should the average county yield fall below this trigger yield, you may be eligible for a loss payment. Indemnity payments are made after the announcement of the NASS county yield, which is generally several months after the harvest of the crop.
Overview
- Protection against widespread loss of production of the insured crop in a county.
- Developed on the basis that when an entire county’s crop yield is low, most farmers in that county will also have low crop yields.
- You could suffer a loss and not collect an indemnity if the county average yield is above the trigger level. At the same time, you will receive an indemnity if the county yield triggers a loss even if you may not suffer an individual loss.
Benefits
- Generally less costly than MPCI coverage based on your actual production history.
- Less paperwork: Simplifies risk management because you only need to provide the number of acres planted by the acreage reporting date.
- Production history or evidence of loss is not required because loss payments are based on the county-average yield.
Loss Triggers
Pays when the NASS-calculated county yield falls below the “trigger yield. ” Indemnity payments are calculated several months after harvest, when the NASS data is released.
Remember, you could suffer an individual loss and not receive an indemnity if the county average yield does not trigger a payment.
GRP Example
Situation: County yields fall below “trigger yield.”
Trigger Yield: Expected County Yield x Coverage Level (%) = Trigger Yield
150 bu./Acre x 90% = 135 bu./Acre
Policy Protection: Purchased Coverage x # of acres farmed = Policy Protection
$120/Acre x 200 Acres = $24,000
Triggering the Claim:
Trigger Yield – Final County Yield = Production
135 bu./Acre – 125 bu./Acre = 10 bu./Acre
Payout: Production ÷ Trigger Yield x Policy Protection = Payout 10 bu./Acre ÷ 135 bu./Acre x $24,000 = $1,777
|
