Crop Insurance Today Second Quarter 2020 - 20

(WASDE), various issues; NASS Quick Stats; RMA
Manager's Bulletins, Price Discovery Application,
and Actuarial Information Browser.]

Program and Policy
Developments
IMPLEMENTING THE 2018 FARM BILL
After returning from a government-wide
shutdown at the beginning of the 2019 calendar
year, RMA started to aggressively implement several program changes brought about by the Agriculture Improvement Act of 2018 (Farm Bill).
Numerous crop program improvements and expansion were directed by the Farm Bill, further
entrenching the Federal crop insurance program
as the key safety net for crop losses.
As farm income dropped and commodity
prices remained depressed, the Farm Bill provided farmers new options for electing either
Agriculture Risk Coverage (ARC) or Price Loss
Coverage (PLC) for crop years 2019 and 2020.
RMA coordinated with the Farm Service Agency (FSA) and issued guidance on the interaction
of ARC and PLC with the Supplemental Coverage Option and the Stacked Income Protection
plans of insurance addressing the varying dates
and interaction between the programs for sales,
election sign up and enrollment, and acreage reporting. Later in the year, RMA provided clarifications for the 2020 crop year that producers
would be prohibited from obtaining certain benefits under both the Supplemental Coverage Option (SCO) and Stacked Income Protection Plan
(STAX) plans of insurance and ARC-PLC for the
same acreage. RMA data was also declared the
primary data source for determining expected

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SECONDQUARTER2020

and final area yields for the STAX program.
One of the bigger Farm Bill directives amended the Controlled Substances Act and Agricultural Marketing Act of 1946 to address how
industrial hemp is defined and regulated by the
Federal government. This led to hemp being designated an agricultural commodity and eligible
to be an insured crop, but one of RMA's first actions was to clarify that hemp could not be insured under the existing 2019 crop year Whole
Farm Revenue Policy (WFRP). However, in time
for fall sales (2020 CY), hemp could be insured
under the WFRP policy provided it was grown
consistent with certain requirements mandated
by the Farm Bill. And, by December, the Federal
Crop Insurance Corporation Board of Directors
(Board) approved an individual crop insurance
policy for hemp for the first time, which will be
available in 2020 for a number of states.
The Farm Bill also modified the definition of
beginning farmer and rancher for WFRP policies
by extending their benefits from five to not more
than 10 crop years. For all policies, program benefits were further provided for veteran farmers
and ranchers giving them the same benefits as
beginning farmers and ranchers, which includes
waiver of Catastrophic (CAT) and additional
coverage administrative fees, an additional 10
percentage points of premium subsidy, use of another person's actual production history, and an
increase in the transitional yield used for Yield
Adjustment when replacing a low actual yield.
Finally, applicable to all CAT risk protection plan
policies was an increase in the administrative fee
from $300 to $655 for each crop in a county.
Coordinating with FSA, the Natural Resources
Conservation Service, and key conservation and

cover crop representative groups, RMA developed and issued new guidelines that addressed
Farm Bill requirements for the treatment of
cover crops within the Federal crop insurance
program. These guidelines included added flexibility for terminating cover crops while still
maintaining eligibility for crop insurance, treating cover crop management as a good farming
practice, improving flexibility for failed crops
and termination practices on summer fallow
land, and in general serving as a national resource for cover crop termination in cover crop
management systems.
EXPANDING AND IMPROVING CROP
INSURANCE COVERAGE
Although 2019 kept bringing repeated challenges to RMA and the crop insurance industry, the ongoing commitment towards program
improvements and expansion never wavered. In
follow up to the 2018 and 2019 hurricane disasters affecting much of the South and Southeast,
RMA continued its willingness to work with
growers to address needed program improvements. Throughout 2019, RMA held listening
sessions with growers and the insurance industry to work towards development of polices
offering coverage for hurricane wind and improvements to nursery and citrus coverage.
RMA also held numerous meetings with
stakeholders looking to improve the effectiveness of the WFRP policy including changes
stemming from the 2018 Farm Bill. In addition
to adding coverage for hemp, these improvements included increasing the revenue limits
for animals and nurseries, incorporating various options to moderate coverage declines resulting from disaster years, excluding disaster
payments from allowable revenue and revenue
to count at claim time, and adding flexibility and effectiveness to make the WFRP policy
more workable and viable for farmers.
Existing crop program improvements saw
more than 14 different crops - many of them
fruit, vegetable, and specialty crops - experience multiple modifications, coverage additions, refinements, and other changes targeted
to meet grower demand and requests for better
coverage. Through ongoing Board oversight,
RMA and private developer efforts targeted various tree crops, vegetable and hybrid seed crops,
pasture, rangeland and forage, cherries, fresh
market beans, and numerous other crops. With
the elimination of the $20 million underwriting cap on livestock products, the Board also
Crop Insurance Today Second Quarter 2020

Table of Contents for the Digital Edition of Crop Insurance Today Second Quarter 2020
