Crop Insurance Considerations

Jason Alexander

DTN Ag Summit

Farm Credit Mid-America

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Thank You

Securing the Future of Rural Communities and Agriculture

Take the time to answer questions and tell your story; especially to the next generation

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About Farm Credit Mid-America

Member-owned cooperative

Part of the nation wide Farm Credit System

Financial strength in numbers

$22 billion in assets

Four-state territory (IN, OH, KY, TN)

Nearly 100,000 members

More than 1,100 staff in 91 offices

Loans, Leases and Crop Insurance

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Our Crop Insurance Team

Crop Insurance at Farm Credit Mid-America

52 crop insurance team members

2.5 million acres insured

Non-commissioned agents

Team approach

We seek to understand your operation, provide solutions to problems, and provide value to you based on your needs

We work together to assist you in making educated decisions on all the options available

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Todays Topics

What are some things you can look for on your crop insurance policy to make sure you are getting added value at little to no additional cost?

Are you missing bushels/$$ on any of these?

Yield Exclusion and Trend Adjustment

Whats on your Schedule of Insurance

Added Land

Adding Irrigation

No Longer Farming

Private Products

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Trend Adjustment

Trend Adjustment addresses yields that do not accurately reflect current yield potential due to improved genetics and practices

A trend adjustment factor is used for each crop and county

Will affect guarantees and premium

TA is applied to, and could improve, each of your APH databases

Example to come

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Yield Exclusion

What is it and how does it help It allows you to exclude an actual yield from a crop year from

your APH

It can increase your approved APH

It has to be a year when the county average was less than 50% of the 10yr. county average

You can opt in or out by farm/unit

If one farm had a good yield in a year when others were very bad. You need to be aware and review this.

It must be elected on your application/renewal

From a farmer perspective, I dont see any reason why this yield exclusion wouldnt be used. This is the biggest improvement to Crop Insurance since we added the harvest price.

Art Barnaby, Kansas State

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2015 Non-Irrigated Corn Yield Exclusion (YE)

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Trend Adjustment and Yield Exclusion

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Yield Exclusion quote

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80% Coverage without TA & YE

75% Coverage with TA

70% Coverage with TA & YE

Yield Exclusion

You dont want to just pay attention to coverage levels and the associated premium anymore - its the dollar guarantee that matters

You must pay attention to the years that are eligible and how that change affects each of your units

You can opt in and out by year by unit. This takes good communication with your Crop Insurance Specialist

Every bushel and every dollar guaranteed matters.

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Schedule of Insurance Optional Units Summary

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Schedule of Insurance Enterprise Unit Summary

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Added Land with T-yield for Corn

This unit was set up as added land for corn

This producers SA yield is 163bu/acre

You should get the higher of the SA or T-yield

The fix added 15 bushels and $57.90 guarantee an acre to this farm

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Added land with T-yield for Soybeans

This unit was set up as added land for soybeans

This producers SA yield is 50 bu/acre

You should get the higher of the SA or T-yield

The fix added 10 bushels and $44.25 guarantee an acre to this farm

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No Longer Farming a Farm/Unit

The APH database still exist unless you designate as No Longer Farming

What does this affect? Your simple average. Remember we just discussed getting the

higher of the two when you have added land

By removing the NLF database, you could increase your simple average in turn finding bushels/$$

It could also be helping you in which case you would not want to designate as NLF

The farm in the previous example had two NLF databases removed at the same time which increased the corn SA from 159bu to 163bu

This simple fix added $15.44 to this new farms APH for 2016

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Adding Irrigation in a County

Have you recently or will you be adding irrigation in a county for the first time?

Did you know your agent must complete a special request from RMA for this farm/unit to pick up the previous yield history on this farm

If not, this farm will receive the T-Yield

These special requests take time to complete and must meet very specific deadlines

If this particular farm had a non-irrigated APH of 170 and the irrigated T-yield for that county is 150, you would have missed 20 bushels and $77.20 an acre

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Private Products

There is an array of private products available.

Additional price discovery periods

Margin protection

Unit structure options

Hail products and price can vary. Cash discounts are available on some

Be diligent and seek to understand what is available, and how it fits your operation

Work with someone who can bring a team of experts to the table to analyze your situation and provide solutions based on your needs and plans

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Todays Topics

Understanding your MPCI options and knowing what to look for

High level overview of things that may add up to bring added value for little to no additional cost

Crop insurance is your only subsidized input cost. Take full advantage of it

Challenge Let Farm Credit help you review your policy documents

Seek to understand what you have

Let us know how we can help

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Thank You

Jason Alexander

Vice President Crop Insurance

Farm Credit Mid-America

Jason.Alexander@e-farmcredit.com