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Vol. 17, No. 2
Article 8 of 10
February 20, 2007
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2007 Crop Insurance By Ray Massey Every year there is something new in crop insurance for Missouri crop producers. Sometimes it is a new type of insurance policy or a new crop eligible for insurance coverage. This year the big change is likely to be the cost of the premiums-and subsequent payouts should you have a claim. The reason farmers will see higher premiums in 2007 is because of higher crop prices. Should a producer have a claim, the insurance company will be paying greater indemnities due to the higher prices for corn and soybeans. It appears that the cost of enjoying higher commodity prices is paying higher premiums. The price elections for yield-based insurance (actual production history (APH)) in the table below show the difference in prices from 2006 to 2007. The price elections for revenue-based insurance (crop revenue coverage (CRC), revenue assurance (RA) and group risk income plan (GRIP)) will be announced on March 1, when the average February futures price quotes can be computed.
Another change in 2007 is the claim reporting deadline. Insured producers are responsible to notify their insurance company within 72 hours of an initial discovery of damage. This discovery cannot be later than 15 days after the end of the insurance period. The end of the insurance period typically is the harvest of the crop, but can occur sooner if there is total destruction or abandonment of an insured crop. To guarantee adequate consideration of a claim, do not wait to report damage. Because crop insurance is subsidized by the federal government, it has historically paid more out in indemnities to farmers than has been paid in premiums by farmers. For a historical perspective of crop insurance in Missouri, go to www.agebb.missouri.edu and look under the Farm Management link for "Crop Insurance in Missouri."
Ray Massey |
