First Tribune Insurance 2015 Crop Insurance Spring Farm Meeting.

First Tribune Insurance 2015 Crop Insurance Spring Farm Meeting

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Non‐Discrimination Statement

Non-Discrimination Statement

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and

activities on the basis of race, color, national origin, age, disability, and where applicable,

sex, marital status, parental status, religion, sexual orientation, genetic information,

political beliefs, reprisal, or because all or part of an individual’s income is derived from any

public assistance program. (Not all prohibited bases apply to all programs). Persons with

disabilities who require alternative means for communication of program information

(Braille, large print, audiotape, etc.) should contact USDA’s TARGET Center at (202) 720‐

2600 (Voice and TDD). To file a complaint of discrimination, write to USDA, Director, Office

of Civil Rights, 1400 Independence Avenue, S.W. Washington, DC 20250‐9410, or call (800)

795‐3272 (voice) or (202) 720‐6382 (TDD). USDA is an equal opportunity provider and

employer.

The information contained in this printed material might not account for recent changes mandated by the Risk Management Agency with respect to the deliverance of the Federal Crop Insurance Program.

Please call FTIA if you have any questions.

620-376-4239

[email protected]

WWW.FirstTribuneInsurance.com

WWW.Facebook.com/FirstTribuneInsurance

Disclaimer

The information contained in this book and the information we will be presenting does not account for all recent changes mandated by the Risk Management Agency (RMA) with respect to the delivery of the Federal Crop Insurance Program. We have made every effort to ensure the information included is current and accurate; however:We encourage you to come in and go over your policy with First Tribune Insurance Agency agents to insure you are getting the best policy for your needs.

Present to March 16th , 2015

You can only make changes to a policy until March 16th for Spring crops and until September 30th for wheat.

This includes adding the new Yield Exclusion Endorsement and the Supplemental Coverage Option

You can now insure your Irrigated and Non-Irrigated crops at different levels.

Do you qualify as a Beginning Farmer?

Tell us about any new breaking ground. Written agreements are due by March 16th .

Present to March 31st , 2015

Producers make a one-time election of either ARC or PLC for the 2014-2018 crop years at the FSA office.

June 1st , 2015

Check with FSA and make sure you have a AD-1026 certification of compliance on file by June 1, 2015. To be eligible for premium subsidy a completed and signed form AD-1026 must be on file with FSA by June 1, 2015 for the 2016 reinsurance year (July 1, 2015 – June 30, 2016), and you, and any affiliated person, must be in compliance with the HELC and WC provisions.

Don’t be confused

Keep it Simple…

2014 Farm Bill Commodity Program Highlights

• No more direct, countercyclical or ACRE program payments• Must choose (1 time for life of Farm Bill) between

› Price Loss Coverage (PLC, payments when prices fall below a trigger)› Agriculture Risk Coverage (ARC, payments when per-acre revenues fall

below a trigger)› If producers don’t agree on the same program, NO payments for 2014 crop

and enrolled in PLC for 2015

• A new crop insurance option (SCO) for PLC participants› Approved Insurance Providers sell and administer SCO

Click icon to add picture

Price Loss Coverage (PLC)

• Makes payments when Marketing Year Average (MYA) price falls below the Reference Price

• Makes up that difference on 85% of the producers base acres

• Payments tied to base acreage and program yields• These generally do NOT depend on current production

choices› Except for those with cotton base or with fruits and

vegetables, planting more or less of a given crop will have NO effect on payments

• New “reference prices” are far higher than old target prices› See next slide

• Administered by FSA but available with SCO

Reference and Target prices

2008 Farm Bill Target prices

2014 Farm Bill Reference prices

Wheat/bu. $4.17 $5.50

Corn/bu $2.63 $3.70

Soybeans/bu. $6.00 $8.40

Sorghum/bu. $2.63 $3.95

Upland cotton/lb. 71.25 cents None*

Long-grain rice/cwt $10.50 $14.00

Peanuts/ton $495 $535

*Upland cotton is not eligible for PLC (or ARC) benefits under the 2014 farm bill as it has STAX.Under PLC, payments are made in October of the year after the crop is harvested (e.g., payments for the 2014 crop would be made in October 2015)

Agriculture Risk Coverage (ARC)

• Makes payments when per-acre revenues fall below a trigger

• Trigger depends on moving averages of market prices and yields

• Paid on base acreage, not planted• Tied to county or farm yields, not state• Covers losses of 14-24% (ACRE was 10-35%)• Administered by FSA

ARC Details

Payments if per-acre revenues fall below 86% of benchmark:• County : 5-yr. Olympic avg. national price * 5-yr. Olympic

avg. county yield• Farm: 5-yr Olympic average of the weighted per-acre

revenues• Prices used to compute averages are higher of farm price

or reference priceMaximum payment: 10% of benchmark (covers 76-86%)Paid on 85% (county yield option) or 65% (farm yield option) of base acres (not planted)As with PLC, 2014 crop year payments to be made in October 2015

FSA Farm Bill Activity Timelines

• Present to March 31, 2015- Producers make a one-time election of either ARC or PLC for the 2014-2018 crop years

• Mid-April 2015 through Summer 2015- Producers sign contracts for 2014 and 2015 crop years

• October 2015- Payments for 2014 crop year, if needed

• Payment limitation rules› $125,000 payment limitation on ARC/PLC + marketing loan benefits

› Could affect many producers

› Not eligible for any PLC or ARC payment if Adjusted Gross Income exceeds $900,000 from all sources

Make Better Decisions

• Three universities also have decision making tools available to producers/agentsTexas A&M

› www.AFPC.TAMU.EDU

University of Illinois› http://farmdocdaily.illinois.edu

Kansas State University› http://www.agmanager.info/fb.htmRMA › http://prodwebnlb.rma.usda.gov/apps/CIDT/

Is your head swimming yet?

http://www.afpc.tamu.edu/

http://farmdocdaily.illinois.edu/



What is SCO?

• SCO provides area-based coverage for a portion of your insurance deductible

• SCO is an endorsement to Yield Protection (YP), Revenue Protection (RP),Revenue Protection with the Harvest Price Exclusion (RP-HPE)

• The endorsement will be available in select counties for corn, soybeans, wheat, sorghum, cotton, and rice starting with the 2015 crop year

• Must be purchased with an underlying individual crop policy• Liability (max payout) based on expected crop value for the individual

grower› But the amount paid out is based on how well the county does› Payment generally occurs later than for individual policy

› Based on when county data becomes available

› Similar to Area Risk Protection Insurance (ARPI)

• 65% premium subsidy

› Regardless of coverage level of the underlying policy

Overview of SCO

• SCO coverage type follows underlying plan of insurance› If underlying policy is yield-based (YP or APH), SCO also provides yield

coverage› If underlying policy is revenue-based (RP or RP-HPE), SCO provides revenue

coverage

• Separate Premium and Administrative Fees for SCO by crop/county› In addition to fees for underlying individual policy› Follows underlying policy

• The amount of SCO coverage depends on the liability, coverage level, and approved yield of your underlying policy› If there are multiple types or practices for the insured crop in the county, the

supplemental protection will be determined separately for each coverage level, type, and practice

• Indemnity payments for SCO are based on whether the yield or revenue for an area (generally county) falls below its expected level

100%95%90%86%80%75%70%65%60%55%50%45%40%35%30%25%20%15%10%5%0%

SCO CoveragePercent of Expected Grower Revenue

Individual Revenue Policy (75% coverage)

SCO Revenue(86% to 75%)

Area-Based LossIndividual Loss

Example:

Grower purchases an individual revenue policy, 75% coverage



In this example, the grower selects 75% revenue coverage. This means that 75% of the grower’s expected revenue is coverage by the individual (or ‘underlying’) policy, and SCO covers an additional 11% of crop value (the difference between 86% and 75%). Any SCO indemnity payment will be based on whether or not the Final Area Revenue falls below the Expected Area Revenue

Other Farm Bill Changes

• Beginning Farmer and Rancher (BFR)› If qualified, receive 10% points higher subsidy and 80% of T-yield for YA› Separate application required and proof of qualification must be provided

with the application

• To be a Beginning Farmer/ Rancher, an individual:› Must not have actively operated and managed a farm or ranch in any

county/state, for more than 5 years, with an insurable interest in a crop or livestock as an› Owner-operator,

› Landlord,

› Tenant, or

› Sharecropper

• Insurable interest may exclude any crop year:› Under the age of 18› In post-secondary studies or› On active duty in the U.S. military


Requesting BFR

• An individual must complete a BFR application by the applicable Sales Closing Date to be eligible

• If insured has an EIN, all individuals with a SBI in the insured must be qualified as a BFR

• Documentation for BFR eligibility and excluded years of insurable interest must be provided by the producer at the time of BFR application

• Approved Insurance Providers verify BFR status by the acreage reporting date and notify the producer of failure to qualify, if applicable

• An amended BFR application is required to update the status when there is a change in exclusions of insurable interest› For example, an Individual in the Army Reserve goes on active duty

Other Farm Bill Changes

• Conservation Compliance (Applicable to Highly Erodible Land (HEL) and Wetlands)› Violations include converting a wetland, planting on converted wetland, and

planting on HEL without a conservation plan› If in violation or without an AD-1026 on file w/ FSA by 6/1/15, insured will

have no premium subsidy on all policies but can still have crop insurance› Ineligibility applies to reinsurance year(s) after final determination, including

all appeals of violation/non-compliance› First year of ineligibility will be 2016 reinsurance year

› FSA will send RMA a list of violators this winter› Q. Do I need to have a completed certification of compliance, form

AD-1026, filed with the Farm Service Agency (FSA) to be eligible for premium subsidy on my crop insurance policies?A: Yes, to be eligible for premium subsidy a completed and signed form AD-1026 must be on file with FSA by June 1, 2015 for the 2016 reinsurance year (July 1, 2015 – June 30, 2016), and you, and any affiliated person, must be in compliance with the HELC and WC provisions.


New Producer

A New Producer (NP) is a person who has not been actively engaged in farming for a share of the production of the insured crop in the county for more than 2 APH crop years• The insured must not have produced the insured crop in the county

for more than 2 APH crop years, ever (not limited to just the last 10 years)

• Producing the insured crop means actively engaged in farming for a share of the insured crop’s production in the county or being a SBI holder to a person who has been actively engaged in farming for a share of the insured crop’s production in the county› If a crop is planted and insurable it is considered producing the crop for NP

purposes (i.e. wheat for grain that gets short-rated or corn for grain that gets harvested as silage)

› Producing the crop does not include when the crop is planted in such a way that it would not be insurable (i.e. wheat planted with intent to graze/hay or silage-only type of corn planted for silage in grain only county)

New Producer

• Benefit is 100% of T-yield without having records, plus ability to qualify for Optional units› If qualifying for NP with 1 or 2 years of actual records, those records must

be provided

• Must request, document, and verify NP status by (PRD) production reporting date.› The company must obtain NP Certification form initial year NP status is

requested› Includes New and Transfer in policies

• Determine New Producer status early and make sure you truly qualify to avoid problems down the road

• NP’s also need to turn in an Intended A/R for (PP) Prevented Planting eligibility purposes the first time they farm in a new county› Intended A/R for PP eligibility not accepted if other crops previously grown

in county


New Producer – Regional Office Request

• Some situations allow a request to the regional office (RO) for a 100% T-yield when otherwise the insured may be limited to something less

• Solution to avoid 65% T-yield is to make a request to the RO to use 100% T-yield

• Formation or dissolution of an entity does not automatically qualify the new entity as a New Producer › These situations no longer allow an RO Determined Yield request due to

“New Person” procedures

• Situations that may still warrant an RO Determined Yield: › A person or SBI has NOT produced or shared in the crop for more than 2

APH crop years in the last 10 calendar years› Insured produced the crop for more than 2 crop years, stopped farming ALL

land in that farming operation, and has produced the crop on entirely different land for 2 APH crop years or less in the county

• Use RMA RO Determined Yield Request form and the request must be made by the Production Reporting Date Click icon to add picture

WFRP Basics

• A whole-farm insurance product that provides producers with risk management protection for all commodities on the farm under one insurance policy.

• Provides protection against loss of revenue that a producer expects to earn or will obtain from commodities produced or purchased for resale during the insurance period. › Whole-farm revenue consists of revenue from all insured

commodities on the farm operation, including revenue from animals and animal products.

• Insures against loss of approved revenue due to unavoidable natural causes that occur during the insurance period

• Insurance Year › A calendar year if you file your taxes on a calendar year basis, or › A fiscal year if you file your taxes on a fiscal year basis› is designated by the calendar year in which the sales closing date

occur

WFRP Basics

Coverage is based on the lesser of:• The farm operation’s whole farm historic average revenue and expenses

using five consecutive tax years information immediately before the insurance year and adjusted according to the policy › Indexing process accounts for farm growth› Expanding operations provision allows for 10% growth over historic

average, with AIP approval, and;• The commodities the producer expects to earn revenue from during the

current insurance period as reported on the Farm Operation Report

Coverage levels of 50% - 85% in 5% incrementsLosses are based on:• Whether the Allowable Revenue, (farm revenue the IRS requires to be

reported on the farm tax records) from the production of commodities produced during the insurance year, falls below the Insured Revenue (the amount of revenue the farm operation is expected to earn during the insurance year times the coverage level chosen).

WFRP Premium Subsidy

WFRP Subsidy: Percentage of Total Premium Paid by GovernmentCoverage Level 50% 55% 60% 65% 70% 75% 80% 85%Whole-Farm Subsidy-Qualifying Commodity Count: 2 or more

80% 80% 80% 80% 80% 80% 71% 56%

Basic Subsidy-Qualifying Commodity Count: 1

67% 64% 64% 59% 59% 55% 48% 38%

• Farms with 2 or more commodities receive Whole Farm premium subsidy• Farms with 1 commodity receive standard premium subsidy

YA, YE, TAYield Adjustment (YA) APH Adjustment Election Insured’s may elect to substitute their actual APH yields with 60% of the county T-yield if their individual APH yields, in comparison, are lower.

Actual Yields include:

• Assigned Yields

• Temporary Yields

Yield Exclusion (YE) The APH YE is a provision of the 2014 Farm Bill that allows for the exclusion of an actual yield for a crop year when RMA determines the county per planted acre yield for a crop year was at least 50 percent below the simple average of the per planted acre yield for the crop in the county for the previous 10 consecutive crop years. When a crop year is determined to be eligible for YE for a crop in a county, producers in contiguous counties will also be eligible to exclude their actual yield for that crop year under YE. Separate determinations will be made for irrigated and non-irrigated acreage, when data is available. The YE option will be listed in the county actuarial documents showing the crop and eligible crop year(s) for exclusion.

Trend Adjustment (TA)Trend Adjustment assesses yields by county, Makes up for lag in APH yields Recalculated every year, Continuous until canceled, Must be chosen by sales closing date, Covers corn, soybeans and wheat, (not available everywhere)

Higher rate does apply

Transition Yields (T-Yield)If at least four successive years of records are not available, a transition or T yield for each missing year must be substituted. Each county has a different T yield. It is based on the 10-year historical county average yield. Growers with no records are assigned 65 percent of the T yield as their APH yield. Growers with a record for one year receive 80 percent of the T yield for the other three years. With two records, they receive 90 percent of the T yield, and with three records, they receive 100 percent of the T yield for the one remaining year needed to calculate the APH. Once each year has been assigned a yield, the APH is just a simple average of the four yields.

If only a few years of yield records exist, the APH yield may be considerably below the actual expected yield because of the reduced T yields. In that case, buying an ARPI Product may be a good strategy, since ARPI Product guarantees are based on county yields rather than individual farm yields. This could provide a higher level of protection while the farm builds records to establish a realistic APH yield.

A new farmer or one who has never planted the crop to be insured will receive 100 percent of the T yield for the APH. If the crop continues to be planted for four years, the T yields will be replaced with the actual production each year. New producers who have previously been closely associated with farming a particular unit, such as children taking over a family farm, can use the previous operator’s records to establish an APH yield.

Once four years or more of production history are available, the APH is the simple average of all of the yearly reported yields. The four years of history will eventually build to ten years. After ten years of history are reached, the APH becomes a moving ten-year average yield. As each new year of production history is added, the oldest record is dropped out of the calculation.

Cup and FloorWhen a new yield record is added to the APH history, the APH has a cup of 10 percent, that is, the proven yield is not allowed to decline by more than 10 percent in one year.

The APH also has a floor equal to 70 percent of the T yield for growers with only a one-year record. Growers with two to four years of yield records have a floor equal to 75 percent of the T yield, while growers with five or more yield records have an 80 percent of T yield floor. This prevents a year in which a producer has a severe crop failure from having a disproportionately large influence on the APH yield, especially when only a few years of yield records are available.

Producers also can request that a low yield for a particular year be replaced with a yield equal to 60 percent of the county T yield. In effect, this becomes the minimum reported yield. This adjustment can be requested for any past year used to calculate the APH yield.

Although the APH yield is usually just a simple average of the production history for each insurance unit, a grower who enters farming, adds new land, plants a new crop, or has a crop failure can cause one or more of the special provisions to be implemented. Therefore, it is a good idea to establish the APH for each insurance unit with a licensed crop insurance agent long before the sign-up date. Even for the catastrophic level of coverage, an APH value for each farm unit is needed.

Trend Adjustment

• Optional – must be elected by sales closing date• Adjusts each eligible yield in database (Actual & YA only)• Available on buy up levels of RP, YP, RPHPE - not available on CAT• Cups and yield floors not applicable when TA is elected for the crop

› Even on a unit with a database that does not qualify for TA› Practices/types excluded from TA by RMA are still eligible for cups/floors

• SA (simple average) T-Yields must be recalculated in subsequent years if the insured removes the TA election› Any 2014 SA T-Yield calculated from approved APH yields that were based

on actual yields with Trend Adjustment must be replaced with Variable T-yields if TA is cancelled for 2015

› If RMA cancels TA for the crop/practice, AIP can recalculate SA T-Yield

• Approved APH yield will not be less than what it would have been w/out the TA adjustment OR greater than the highest actual yield in the database plus one year of trend adjustment

APH Database Qualifications for TA

• APH database must have at least one actual yield in one of the four most recent crop years to qualify for TA

• If the APH database contains fewer than four actual yields in the 12 most recent crop years the trend adjustment is reduced as follows:1. One actual yield = 25 percent of trend adjustment;

2. Two actual yields = 50 percent of trend adjustment;

3. Three actual yields = 75 percent of trend adjustment;

4. Four or more actual yields = 100 percent of trend adjustment › (If 2 actual in last 12 and TA is 2 bushels, adjustment would be 1 bu.)

• 2003 is last year in the database we can use to find our 4 actuals in the most recent 12 years (2015 – 12 = 2003)

• TA amounts vary from year to year› Check actuarial

High-Risk Alternate Coverage Endorsement (HR-ACE)

• The HR-ACE allows policyholders to insure high-risk acres at an additional coverage level that is lower than the coverage level on their non-high-risk acres but higher than CAT level

• HR-ACE may be elected with the following coverage plans:› Yield protection› Revenue protection› Revenue protection with harvest price exclusion


New Breaking Acreage

Two options for insuring New Breaking (NB) acreage1. Request for Written Agreement to RMA Regional Office, by Sales

Closing Date› NB Type details in Paragraph 73 of Written Agreement Handbook

2. Request to the approved insurance provider, by Acreage Reporting Date

› Statement must be present in Special Provisions for crop/county› Must meet insurability requirements in Special Provisions› Statements in same format as we had for 2014 Spring› If this option available, NB must come to the AIP first versus an RO Written

Agreement request


New Breaking Coverage via Regional Office Written Agreement

• Written Agreements (WA) due by SCD• WA will provide 65% T-yield if true native sod• If ground previously broken, WA will be 80% T-yield• NB acreage must be reported by CLU (FSA farm/tract/field) on

acreage report, production report, and APH database› If not, policy will not clear RMA edits› Policies must be Mapped in 2015

• If in a county with the New Breaking Insurability Request option, the RO will only do NB WA on policies that do not meet requirements that allow AIPs to approve› Acreage minimums exceeded› Soil Type Capability class not met› Deadline to break out NB acreage was missed

New Breaking SP STATEMENTS

11/30 CCD

IV & 11/30

III & No Date

IV & No Date

III & 2/28

Coverage on Acreage Emerging from USDA Program

• Crop Insurance Handbook now states “Acreage Emerging from a USDA Program” instead of just CRP› No procedural changes, however

• If acreage planted within first two years of emergence, insured uses history prior to CRP or gets 100% of T-yield on CRP acreage for initial year

• CRP acreage must be reported separately on acreage report, with a separate APH database, and CLU’s identified and maintained on units containing CRP› Must report by FSA farm/tract/field to clear RMA edits› Policies must be mapped in 2015

• 2nd year after planting, separate databases are combined and standard APH procedures apply


CRP ProcedureThis Chart is for Illustration Purposes Only

Is the acreage planted within 2

crop years of emergence from CRP program?

YES

1st YearPrior history applicable to CRP acreage may be (re)certified by the production reporting date.

*SA Ts, PTYs and MYs are NOT applicable to CRP acreage the first year.

NO

2nd Year1. If applicable, APH

databases within a unit must be combined.

2. Standard T-Yield / APH rules apply.

1st Year Planted1. Acreage is insurable without written agreement.2. APH(s) and acreage reports must be identified/reported

separately on the applicable CRP acreage.3. CLU’s must be identified and maintained on CRP acreage4. Standard unit division/PTV guidelines apply*

1st Year100% of county T-Yield will apply to the CRP acreage.

*SA Ts, PTYs and MYs are NOT applicable to CRP acreage the first year.

2nd Year1. If applicable, APH

databases within a unit must be combined.

2. Standard T-Yield / APH rules apply.

NB WA procedures apply

OR

33

2015 Cover Crops

• Statement and procedures remain essentially the same for 2015› Always check the Special Provisions for your crop/county and utilize the

IMAP on the NCIS webpage to help identify specific changes in your area

• Statement (shown below) dictates use of NRCS Cover Crop Termination Guidelines found on the NRCS website› The NRCS Termination Guidelines did change for 2015 crops

• Insurance shall attach to a crop following a cover crop when the cover crop meets the definition provided in the Basic Provisions, was planted within the last 12 months, and is managed and terminated according to NRCS guidelines. If growing conditions warrant a deviation from the guidelines, producers should contact either Extension or the local NRCS for management guidance. For information on cover crop management and termination guidelines, refer to the Cover Crop Termination Guidelines published at:

http://www.nrcs.usda.gov/wps/portal/nrcs/main/national/landuse/crops




2015 NRCS COVER CROP TERMINATION GUIDELINES“September 2014, Version 3” Publication

• These guidelines will be applicable to all USDA programs• These guidelines only apply to non-irrigated cropland, including

systems that contain a fallow period› The cover crops in irrigated cropping systems should be terminated based

on the crop system and the conservation purpose, but before the planted insured crop emerges

• Biggest change for 2015 is in areas of the country with a Summerfallow practice› If a cover crop is planted on summerfallow acreage in a fallow year, the

following planted crop will not meet the RMA Summerfallow practice definition until the acres lie fallow for a full year

› If a cover crop was planted during the fallow year, the acreage may be insured under a “continuous cropping” practice (if available) or by written agreement


Click icon to add pictureDECEMBER 2013 & SEPTEMBER 2014

GUIDELINES

ALL ZONE DESIGNATIONS

REMAIN UNCHANGED

PM-14-045: Levels by Irrigated /Non-I

• An insured with an agricultural commodity on IRR & NI land may elect a different coverage level for each practice› Authorized in 2014 Farm Bill Sec. 11015› Cannot have CAT as one of the levels› Available for buy-up policies when provided in actuarial documents,

beginning with 2015 spring crops and the 11/30 Contract Change Date

• For example, insured may choose:› 65% level for IRR Soybean acreage

› IRR-Conventional cannot be different from IRR-Certified Organic

› 80% level for NI Soybean acreage› NI-Conventional cannot be different from NI-Transitional Organic

Levels by IRR/NI QA

Q. Can I elect more than one coverage level if I have more than one type of irrigated practice on my actuarial documents?

A: No, all IRR practices must be insured at the same coverage level and all NI practices must be insured at the same coverage level. For example:

• SF & CC wheat must be insured at the same coverage level.

• IRR wheat may be insured at a different coverage level.

Q. If I do not plant IRR acreage or do not qualify for an IRR practice but I elected separate coverage levels, what coverage level will I have for insurance?

A: You will still have the coverage level you elected for the NI practice. For example:

› Chose 65% for all IRR & 80% for all NI Corn

› If no IRR Corn, the 80% level will apply to all acres qualifying for NI

Q. What if I elected enterprise units by irrigated and non-irrigated practices for my crop and I no longer qualify for the separate EU?

A: Qualification for EU does not impact coverage level elections. The separate coverage levels elected will apply to the unit structure for which you are eligible.

PM-14-046: Enterprise Units by IRR/NI Practice

• 2014 Farm Bill Section authorizes separate enterprise units for IRR & NI acreage

• Available for any crop with EU allowed by:› Actuarial documents;› Crop Provisions; or› Special Provisions

• Enterprise unit structure codes:› “EU”: Single EU by crop/county› NEW “EP” : Separate EU by IRR & NI

› When allowed in actuarials, & insured elects & qualifies for separate EU

• Effective beginning with 2015 spring crops starting with 11/30 CCD


EU by IRR/NI Deadlines and Qualifications

• Producers must elect separate IRR/NI EU by the Sales Closing Date› Use EP (Enterprise by Practice) code and elect on Application or Policy

Change form

• We still determine if insured qualifies for EU by IRR/NI when insured provides acreage report

• EU must contain all insurable acreage:› (a): of the crop in the county [1 EU]; or› (b): [NEW] if allowed & elected, 2 separate EUs by IRR/NI practice:

› One EU for all insurable IRR acreage of the crop; &

› One EU for all insurable NI acreage

• Each IRR/NI EU must meet existing EU requirementsClick icon to add picture

IRR/NI EU Miscellaneous

• An insured cannot elect to have EU on IRR acreage and BU/OU on NI acreage, or vice versa

• If the insured does not qualify for separate EUs on IRR and NI acreage, one EU is still possible if he/she can still meet the qualifications for an EU containing all insurable acreage of the crop

• Existing EU subsidy rates apply• EU discounts are likely to be smaller, as separate EUs will likely

result in smaller tracts of acreage› The reduction will vary depending upon the amount of acreage in each

practice


IRR/NI EU Requirements

• Must plant crop with a clear & discernible break in the planting pattern at IRR/NI boundaries to qualify for separate EUs› Similar to qualifying for OU by IRR/NI, now this language in EU section 733› Not required for single EU by crop/county

› Though separate APH databases still required by P/T

• Applicable “clear & discernible break” language: › Original planting, including reseeding & replanting› Cultivating, disking, mowing, etc., after planting or harvesting does not

qualify› Exception for NI corners of center pivot irrigation system allows for:

› Planting end rows before or after planting; or

› Cultivating, disking, mowing, etc., after planting

› Breaks must be completed by ARD & be clearly discernible if inspection required

• Precision farming & GPS yield monitors meet discernible break requirement


Coverage Levels and EUs by IRR/NI Practice

• IRR EU at 70% level; NI EU at 80%• Does not qualify for separate IRR & NI EU but does qualify for single

EUQ: Which coverage level applies to the single EU? A: One EU but still IRR acreage at 70% & NI acreage at 80%

› IRR/NI levels & EU are separate elections› The only requirements for IRR/NI levels:

› Allowed in actuarials for crop/county;

› Insured has buy-up policy & elects level for each practice by SCD


What is APH Yield Exclusion (YE)?• APH YE is a provision of the 2014 Farm Bill that allows for the

exclusion of an actual yield for any crop year where RMA determines the county per planted acre yield for that crop year was at least 50 percent below the simple average per planted acre yield for the crop in the county for the previous 10 consecutive crop years.

• RMA determines the eligible years and lists them in the actuarial documents for the crop/county

Eligible Crop Year • A crop year determined eligible for exclusion for a crop in a

county, will also be eligible for exclusion in contiguous counties, as identified in the actuarial documents.

• The actuarial documents will identify if the crop year eligible for exclusion is from the producer’s county (primary county, designated with a “P”) or from a contiguous county (designated with a “C”).

• For the current crop year:• The insured must elect YE by the sales closing date by crop/county.• Election must be made on an application or policy change form by indicating

the “YE” option code.

• Policyholders who elect YE must understand that ALL actual yields in an eligible crop year are automatically excluded

• UNLESS the insured opts out of excluding an actual yield by identifying the yield not to be excluded in the APH database.

• YE is a continuous election until cancelled.

Eligibility for YE - Election

• A producer may elect and apply both YA and YE options on a policy and within an APH database.

• Only one option, either YE or YA, can be applied to an actual yield for an eligible crop year within an APH database.

• If both YE and YA are elected and applies to all eligible crop years and a crop year qualifies for both elections, YE will apply to an actual yield in an eligible crop year unless the insured chooses to not exclude that yield in the APH database.

Yield Adjustment Interaction

Adjusted Yield

• When YE is applicable to an APH database, AIPs must calculate an adjusted yield.

• The adjusted yield is the average of the annual yields in the APH database:

• Without yield limitations (cups and yield floors);• Without any yield exclusions; and• With yield substitutions, if YA is elected by the insured. If YA is not

elected by the insured, yield substitutions are not included and the adjusted yield is the average of the annual yields in the APH database.

• If the approved APH yield calculation chosen by the insured excludes at least one actual yield in an eligible crop year, the average yield is used as the rate yield and the effective coverage level (based on the adjusted yield) is used for determining premium rate.

• Effective coverage level same concept as TA, example:• 121 Standard Approved APH• 135 YE APH• 135/121 = 1.12 factor x 75% coverage level = 84% Effective Coverage Level,

used to determine premium rate on the YE unit

Determining Premium Rates on YE Database

Section 15 – Calculating the Yields for APH Databases When YE is Elected (D)

Scenario with YE Option with YA and TA

Year Eligible For Exclusion T-Yield 60% of Applicable T-Yield

APH APH with YA

APH with All Eligible Yields Excluded, YA, and TA

2005 No 206 124 628 628 678

2006 No 227 136 746 746 791

2007 Yes – by Contiguous County 268 161 231 231

2008 No 301 181 563 563 598

2009 No 301 181 430 430 460

2010 No 301 181 111 181 206

2011 No 301 181 531 531 551

2012 Yes – by Primary County 301 181 0 181

2013 Yes – by Primary County 361 217 35 217

2014 No 361 217 95 217 222

Approved APH Yield 337 393 501

Notice of Loss Deadlines

• Provisions require notice of loss w/in 72 hours after discovery of damage, but not later than 15 days after end of insurance period› End of insurance period is not always the calendar date!

• PP Notice of Loss must be w/in 72 hours after:› Final plant date if no intention to plant during the LP

period, or if LP period not applicable› Insured determines he/she will be unable to plant w/in

any applicable LP period• Revenue losses must be submitted no later than 45 days

after release of Harvest price


End of Insurance Period

• Insurance ends on each unit, or part of unit (even though the insurance period may not have ended for other acreage within the unit) at the earliest of:› Total destruction of crop› Harvest› Final adjustment of loss› Applicable calendar date in the Crop or Special Provisions› Abandonment› As otherwise specified in the Crop Provisions Note: the policy does not cover the insured crop after it has left

the field (exception for tobacco and potatoes) It is considered a Delayed Notice if reported after 72 hours of

discovery of damage but no later than 15 days after the end of the insurance period


Claim Reminders

• In a loss situation› Production from different optional units must be separate scale tickets in

addition to marketing records (No commingling)› Or conveyance records in the field (combine hopper, grain cart, etc.)

• If you intend to commingle old crop & new crop, requires measurement by The company

• Appraisal must be completed prior to destroying any crop or putting that crop to a different use


Things to Remember

• Entity Changes – FSA, MPCI, Grain Sales

• Marriages / Divorces / Death

• New Breaking / CRP

• Tax ID Changes

• Authorization to sign (Spouses)Click icon to add picture

Projected price- The pre-harvest year’s average daily settlement price for the projected price discovery period for the harvest year’s futures contract, as shown below, rounded to the nearest whole cent. The projected price will be released no later than three business days following the end of the projected price discovery period. Harvest price- The harvest year’s average daily settlement price for the harvest price discovery period for the harvest year’s futures contract, as shown below, rounded to the nearest whole cent. The harvest price will be released no later than three business days following the end of the harvest price discovery period.

WheatState Commodity Exchange Contract Month Projected Price Harvest Price CO KCBT September Aug 15 to Sept 14 July 1 to July 31KS KCBT July Aug 15 to Sept 14 June 1 to June 30Corn & Grain SorghumCO CBOT December Feb 1 to Feb 28 Oct 1 to Oct 31KS CBOT December Feb 1 to Feb 28 Oct 1 to Oct 31SoybeansCO CBOT November Feb 1 to Feb 28 Oct 1 to Oct 31KS CBOT November Feb 1 to Feb 28 Oct 1 to Oct 31SunflowersCO CBOT December Feb 1 to Feb 28 Oct 1 to Oct 31KS CBOT December Feb 1 to Feb 28 Oct 1 to Oct 31

Discovery Dates

Silage/High Moisture/Appraisal Requirements

• MUST be appraised before cutting/chopping in order to collect a loss.• Please call First Tribune Insurance 620-376-4239 before you harvest!!• Get production in from those units for loss determination.

GRAIN FIRE ENDORSEMENT

Grain fire for wheat

A flat rate of $0.25 per $100 of insurance shall apply to all cropclasses and locations.

Kansas T-Yields

2014 T-Yields - Kansas Greeley Co Wallace Co Wichita Co Hamilton Co Kearny Co Sherman CoCrop T-Yield T-Yield T-Yield T-Yield T-Yield T-Yield Irr Non-Irr Irr Non-Irr Irr Non-Irr Irr Non-Irr Irr Non-Irr Irr Non-Irr Corn 169 34 171 42 177 52 148 32 179 51 178 34Grain Sorghum 84 43 93 36 104 66 84 44 84 52 98 42Silage Sorghum 16.1 5.9 16.1 5.2 18.1 6.4 15.6 5.4 16.4 5.7 15.8 6.1Sunflower-Oil 1550 877 1563 991 1518 1182 1499 855 1579 855 1708 879Sunflower-Conf. 1550 877 1563 991 1519 1182 1501 855 1579 855 1527 739Soybeans 49 16 52 14 43 None 49 None 46 None 51 14Oats 30 30 30 30 30 30 None None None None 30 30Onions: Red None None None None None None 160 None None None None None White None None None None None None 250 None None None None None Yellow None None None None None None 265 None None None None NoneDry Beans: Great Northern 1618 None 1442 None 1618 None None None 1618 None 1688 None Light Red Kidney 1618 None 1442 None 1618 None None None 1618 None 1688 None

Pea (Navy, Med. White) 1618 None 1442 None 1618 None None None 1618 None 1688 None Pink 1618 None 1442 None 1618 None None None 1618 None 1688 None Pinto 1618 None 1442 None 1618 None None None 1618 None 1688 None Small White 1618 None 1442 None 1618 None None None 1618 None 1688 None Barley Winter 43 29 43 29 43 29 43 29 43 29 43 29Barley Spring 43 29 43 29 43 29 43 29 43 29 43 29Millet-MPCI 40 25 40 25 40 25 40 25 40 25 40 25Wheat 45 28(cc18) 45 31(cc19) 47 36(cc25) 44 28 45 32 52 33(cc21)

ALL quotes are always free of charge!

Colorado T-Yields2014 T-Yields - Colorado

Kiowa Co Prowers Co Cheyenne CoCrop T-Yield T-Yield T-Yield Irr Non-Irr Irr Non-Irr Irr Non-Irr A, B, C, D, 4, 5 1, 2, 3 A, 2, 3, 4 1, 2, 3 A, B, 3 Corn 128 16,19,20,26,26,26 110,116,151 20,24,24,37 161 7,21,25Corn Silage Colo Ton Grain Sorghum 52 16,19,23,25,35,35 29,36,55 15,21,23,26 62 16,19,24Silage Sorghum 8.6,10.8,16.3 2.0,2.5,3.1,3.6 Sunflower-Oil 1,425 246,642,749,910,910,1070 855,1040,1425 516,609,718,845 1328,1328,1562 523,617,726Sunflower-Conf. 1,354 181,473,552,671,671,789 814,990,1356 465,549,648,762 1268,1268,1492 464,547,644Soybeans None None 17,26,34 None Oats None None None None Onions: Red None None 160 None White None None 270 None Yellow None None 300 None Dry Beans: Great Northern None None None None 1727 None Light Red Kidney None None None None 1727 None Pea (Navy, Med. White) None None None None 1537 None Pink None None None None 1537 None Pinto None None None None 1727 None Small White None None None None 1727 None Barley Winter 58 9,12,15,20,20,23 37,42,59 11,15,18,21 54 12,14,21Barley Spring 58 9,12,15,20,20,23 37,42,59 11,15,18,21 54 12,14,21Millet-MPCI 40 8,10,13,18,18,20 None None 40 12,14,21Wheat 23 8,10,18,24,21,24 28,38,42 14,18,22,32 43 17,19,23

ALL quotes are always free of charge!

2014

E = Earliest Plant Date L = Last Plant DateLAST PLANT DATES

KANSAS

Wheat Barley Corn Dry Beans Grain Sorghum Millet Oats Soybeans Sunflowers

Greeley 20-Oct 10/20 - 4/30 E4/10 - L5/25 E4/26 - L6/25 E4/26 - L6/25 25-Jun 31-Mar E4/26 - L6/20 E4/25 - L6/25

Hamilton 20-Oct 10/20 - 4/30 E4/5 - L5/25 N/A E4/26 - L6/25 25-Jun N/A E4/26 - L6/25 E4/25 - L6/25

Harper 5-Nov 11/05 - 4/30 E4/1 - L5/25 N/A E4/26 - L6/25 N/A 31-Mar E4/15 - L6/25 E4/20 - L6/25

Kearny 20-Oct 10/20 - 4/30 E4/5 - L5/25 E4/26 - L6/25 E4/26 - L6/25 25-Jun N/A E4/26 - L6/25 E4/25 - L6/25

Lane 20-Oct 10/20 - 4/30 E4/05 - L5/25 N/A E4/26 - L6/25 N/A N/A E4/26 - L6/20 E4/25 - L6/25

Pratt 05-Nov 11/5 - 4/30 E4/1 - L5/25 N/A E4/26 - L6/25 N/A 31-Mar E4/26 - L6/25 E4/20 - L6/25

Sherman 15-Oct 10/15 - 4/30 E4/10 - L5/25 E4/26 - L6/25 E4/26 - L6/25 25-Jun 31-Mar E4/26 - L6/15 E4/25 - L6/25

Wallace 15-Oct 10/15 - 4/30 E4/10 - L5/25 E4/26 - L6/25 E4/26 - L6/25 25-Jun 31-Mar E4/26 - L6/20 E4/25 - L6/25

Wichita 20-Oct 10/20 - 4/30 E4/10 - L5/25 E4/26 - L6/25 E4/26 - L6/25 25-Jun 31-Mar E4/26 - L6/20 E4/25 - L6/25

COLORADO

Wheat Barley Corn Dry Beans Grain Sorghum Millet Oats Soybeans Sunflowers

Arapahoe 15-Oct NA - 4/30 E4/15 - L5/25 N/A N/A 25-Jun N/A N/A E5/15 - L6/15

Baca 15-Oct 10/15 - 4/30 E4/15 - L5/25 N/A E4/16 - L6/20 N/A N/A E5/5 - L6/25 E5/15 - L6/25

Cheyenne 15-Oct 10/15 - 4/30 E4/15 - L5/25 E5/15 - L6/20 E5/1 - L6/15 25-Jun N/A N/A E5/15 - L6/20

Kiowa 15-Oct 10/15 - 4/30 E4/15 - L5/25 N/A E5/1 - L6/20 25-Jun N/A N/A E5/15 - L6/20

Lincoln 15-Oct NA - NA E4/15 - L5/25 E5/15 - L6/20 E5/1 - L6/15 25-Jun N/A N/A E5/15 - L6/20

Prowers 15-Oct 10/15 - 4/30 E4/15 - L5/25 N/A E4/16 - L6/20 N/A N/A E5/5 - L6/25 E5/15 - L6/25

E = Earliest Plant Date

L = Last Plant Date

Plant Dates

Coverage Level 50 55 60 65 70 75 80 85

Subsidy Factors

Enterprise Unit 80% 80% 80% 80% 80% 77% 68% 53%

Basic Unit 67% 64% 64% 59% 59% 55% 48% 38%

Optional Unit 67% 64% 64% 59% 59% 55% 48% 38%

Whole Farm Unit 80% 80% 80% 80% 80% 80% 71% 56%

Coverage Levels & Premium Subsidies

“Top 5” problems we see at FTIA.

1. Share on the settlement sheets is different than it is insured. 2. Delay in production. (Farmers telling us they don’t have a loss, when they do,

resulting in them not getting paid because they didn’t turn production in timely.) 3.Farmers changing shares, acres, or names at the FSA office and not at First

Tribune Insurance.4.Incomplete acreage reports. (Forgetting to report all acres that are planted,

whether insurable &/or non-insurable.)5.Farmers forgetting to report seed wheat in their production.

Crop Insurance Companies

http://www.admcrs.com/

• September 30, 2014:

• Wheat Sales Closing Deadline - Deadline to apply, reinstate, cancel or make changes to your 2015 Wheat Crop Insurance contract. We will have you check all of your information and sign your application by this date.

Earliest Planting Dates: Corn 04/10/2015 Kansas (04/15/2015 Colorado)

• Grain Sorghum 04/26/2015 Kansas (Colorado 5/1/2015, except Prowers 4/16/2015) Soybeans 04/26/2015

• Sunflowers 04/25/2015 Kansas (05/15/2015 Colorado)

• Final Planting Dates: Wheat 10/20/2014 (Greeley, Hamilton, Kearny, Lane, Wichita)

• Wheat 10/15/2014 (Sherman, Wallace) (Colorado)

• Corn 05/25/2015 Grain Sorghum 06/25/2015 Kansas Grain Sorghum 6/15/2015 (Cheyenne & Lincoln CO) 6/20/2015 (Kiowa & Prowers CO)

• Soybeans 06/20/2015 Sunflowers 06/25/2015 Kansas Sunflowers 6/20/2015 (Cheyenne, Kiowa & Lincoln CO) 6/25/2015 (Powers CO)

• Acreage Reporting Dates: Wheat 12/15/2014 Kansas (11/17/2014 Colorado) Corn 07/15/2015 Grain Sorghum 07/15/2015 Soybeans 07/15/2015 Sunflowers 07/15/2015

• March 16, 2015: Spring Sales Closing

• Deadline to apply, reinstate, cancel or make changes, including adding any new endorsements (SCO or YE), to your 2015 Spring Crop Insurance contract. We will have you check all of your information and sign your application by this date.

• July 15, 2015: Spring Acreage Reporting Deadline

• Report all spring planted acres and planting dates. Report any Prevented Planting Acres

• *Please have your FSA-578 Form and Maps at this time. The acres we report MUST match your FSA-578 Certified Acres.

• August 15, 2015: Spring (corn, grain sorghum) Premiums are due

• October 1, 2015: Deadline to pay 2015 spring premiums without interest being charged.

• July 1, 2015: Wheat Premiums are due

• July 31, 2015: Deadline to pay wheat premiums without interest being charged.

• Remember, unpaid premiums go on uninsurable list.

First Tribune Insurance 2015 Crop Insurance Spring Farm Meeting.

Documents

Transcript of First Tribune Insurance 2015 Crop Insurance Spring Farm Meeting.