Federal Multi-Peril Crop Insurance Program
(MPCI) is developed, managed and reinsured by the USDA Risk Management Agency
who in turn contracts with approved private insurers to issue policies,
adjust claims and pay losses to the grower. To make it easier for you, there are
no differences in coverage or premium between carriers.
There are several fruit & nut crops which can be insured for yield losses. In
California, those include many specialty crops such as:
* Almonds * Walnuts
Actual Production History or (APH) crop policies are based on a grower’s actual
past production history. These helps growers if they suffer crop yield losses due
to damage from natural causes such as drought, untimely rains, hail, frost, insects,
or wildlife. Farmers who wish to buy a policy, must do so before the sales closing
date for each crop. The grower can select coverage levels beginning
at 50% and up to 75% of their approved historical average production.
How’s it work? Daniel & Michael farm 100 acres of almonds.
With the help of their crop insurance professional Domenic, they decide
to insure 75% percent of the orchard’s past yield history.
The average past production has been 2,500 pounds per acre.
Regrettably, the orchard suffers a crop loss due to frost at bloom time in the
Spring. Daniel notifies Domenic his agent within 72
hours of the event happening. The carrier sends their adjuster to inspect
the damage. The crop harvested only produced 1,500 pound
of nuts per acre. Since their historical production was 2,500#
per acre, at 75% coverage that’s a guarantee of 1,875 pounds per acre.
1,875 pound guarantee minus the actual production of 1,500 pounds leaves a
deficiency of 375 pounds per acre. The RMA determined value of the crop is $2.15
per pound. 375 pounds multiplied by $2.15/lb. multiplied
by 100 acres=$80,625 total payable loss.
375 pounds x $2.15 X 100 acres=$80,625 total payable loss.
This helps Daniel & Michael to cover the fixed costs invested in the crop and
keeping their family farm going. Since federal crop insurance is partially
subsidized and backed by the USDA, rates are affordable. The farmer pays a portion
of the premium, the government pays the rest.
Your most important decision is to work with a specialist in this type of insurance
coverage. Someone who not only understands the program, but also the risks
you face in bringing your crop to completion. At Golden Pacific Crop Insurance, our agents
have two decades of experience in crop insurance and still farm our own crops
as well. We fully know what you face out there with ever increasing regulations,
water and food safety issues. We know the crops because we grow them.
Give us a call and learn how we can make this very important risk management
tool something that can be easy to use and much more affordable than you may
think. Call us at (559) 825-CROP (2767) or by email
at [email protected]