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Press Release: Crop Insurance to be More Cost-effective for Diversified and Specialty Crop Producers

FOR IMMEDIATE RELEASEOctober 22, 2014

Contact:
Scott Marlow, Senior Policy Specialist
[email protected], (919) 542-1396 x210

Crop Insurance to be More Cost-Effective for Diversified & Specialty Crop Producers

In the coming weeks, USDA is expected to release the details of a new whole-farm revenue policy, known as Whole-farm Revenue Protection (WFRP), which was required by the 2014 Farm Bill. USDA has also made significant changes to the Noninsured Crop Disaster Assistance Program (NAP).

Bringing Whole-farm Subsidy in Line with Other Policies

USDA has announced some of the major changes coming to whole-farm crop insurance. Perhaps the most significant change comes in the form of an increased subsidy. WFRP will be subsidized at 80 percent for coverage levels between 50 and 75 percent, bringing WFRP in line with Revenue Protection insurance plans.

“Increasing the subsidy to 80 percent is a game changer that will dramatically reduce policy premiums for producers,” said James Robinson, Research and Policy Associate at the Rural Advancement Foundation International-USA.

A few of the key changes announced earlier this year by the USDA include:

  • Coverage levels up to 85 percent with an $8.5 million liability limit
  • Premium discounts for additional diversification,
  • Geographic expansion of whole-farm insurance availability, and
  • A “market readiness” provision that enables producers to include post-production expenses associated with bringing a crop to market.

“RAFI worked with Congress and USDA’s Risk Management Agency (RMA) to make farmer-driven changes to existing whole-farm policies. The changes are designed to both reduce the premium costs and overall policy complexity. While we can’t know how well these new policies perform until producers use them, we believe the changes are a step in the right direction and applaud RMA’s responsiveness to producers,” says Robinson.

 NAP Buy-up Option

USDA is also expected to release details on new NAP buy-up options in November. Previous iterations of NAP only offered a coverage level of 50 percent with a payment factor of 55 percent, allowing farmers an actual coverage level of 27.5 percent.

The new NAP buy-up option is different in 3 keys ways:

  • Expands coverage to up to 65 percent, with no payment factor, in 5 percent increments.
  • Farmers will pay a $250 administrative fee per crop as well asa premium of 5.25 percent of total liability.
  • Addition of annual indemnity payment limit of $125,000 per farmer.

All North Carolina growers should have the opportunity to sign-up for buy-up coverage some time after November 1st, though the final date in still pending.


Rural Advancement Foundation International-USA (RAFI) is a non-profit organization that traces its heritage to the National Sharecroppers’ Fund, which was founded in the 1930s by a bi-racial group of tenant farmers organizing for fair treatment. RAFI cultivates markets, policies and communities that support thriving, socially just and environmentally sound family farms. 

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