Crop Insurance 101— Back to the Basics

Make Sure the Farm is Up-to-Date on All Crop Insurance Dates and Coverage

Blueberry crop insurance has been available in Florida for over 15 years.  It started as a pilot program in Alachua and Highlands counties and is now available in 14 counties.  There have been improvements in the traditional crop insurance as well as the introduction of the newer Whole-Farm Revenue Protection (WFRP).  There are many Florida blueberry growers protecting their investments with crop insurance.  There are still many new farmers who are unfamiliar with it.  From time to time, it is always a good idea to review the basics.  Crop insurance is no exception.

FIRST, we should review some important dates.  There is the premium billing date, August 15.  November 20 is the sign-up deadline, also referred to as the sales closing date (SCD).  January 15 is the acreage and production reporting date.  February 28 is the sign-up deadline, or SCD for Whole-Farm Revenue Protection (WFRP).

August 15the premium billing date.  Crop insurance premiums are paid in arrears.  This year’s premium payment is for the crop insurance signed up for last year.  With this in mind, there are some important timing issues concerning the payment itself.  If the insurance company does not receive payment by October 1, interest will begin to accrue.  If the payment is still not received before November 20, the insurance cannot be renewed for the upcoming season.  In addition to denied coverage, the insured will be ineligible for any disaster relief payments or disaster assistance programs until the premium is paid.  If the premium is paid after November 20, the insured will have to wait one year to sign-up again for coverage.

November 20— sign-up deadline/sales closing date (SCD).  If you plan to obtain crop insurance for blueberries for the first time, then an application will need to be signed and dated by November 20.  If insurance is already in place, this is the time to make any coverage changes.  If no changes are needed, the policy will automatically renew with the previous year’s coverage levels and options.

January 15— the acreage and production reporting date.  This is the time to report the total planted acres.  This includes the number of blueberry bushes, the plant spacing, and the plant dates.  In addition, it is the time to report the total pounds of marketed production for the past season.  If it is the first year of coverage, at least four years of production needs to be reported.  If there are less than four years of production, a percentage of the county average will be used to replace up to three years of missing production.  Keep in mind, new farms need to have at least 1,000 lbs. per acre of production to qualify for the insurance.

February 28— signup deadline/SCD for WFRP.  Since WFRP is a revenue based plan, there is a substantial amount of information needed by February 28 to apply for the coverage.  If WFRP is being considered for the 2018 season, five years of Schedule F tax forms from 2012-2016 will need to be submitted.  If a schedule F was not filed, a substitute Schedule F can be prepared for the missing year(s).  If an accountant prepares the tax returns, they can be very helpful in getting this information prepared for the application process.

SECOND, let’s take a look at the insurance plans and coverages.  The traditional crop insurance is based on a farm’s individual production history.  Whole-Farm Revenue Protection (WFRP) is a newer revenue type plan.  It is based on a farm’s overall gross revenue.  Both plans cover weather-related damage.  They also cover insect and disease damage.  One major difference in the two plans is that the WFRP covers decline in price.  This feature has made WFRP an attractive alternative to the traditional plan.

There are some requirements concerning the traditional plan and the WFRP.  The traditional plan requires a farm to have produced at least 1,000 lbs per acre to be eligible for insurance. The traditional plan is only available in select counties.  If the farm is located in a county where there is no blueberry insurance, the grower can apply for insurance through the written agreement process.  A written agreement requires, in addition to the 1,000 pounds per acre qualification, that the blueberry crop has been marketed and sold for the past three consecutive years.  WFRP is available in all counties in Florida.  Because five years of tax history is required, the farming entity or individual will need to be active in the farming business for six years.  However, there is an exception for those farmers who meet the beginning farmer and rancher requirements.  They only need to be in business for four years.  There are other requirements and limitations that can be reviewed with your crop insurance agent.

Crop insurance is a vital tool in the management of the farming operation.  It has helped a vast array of farmers survive and stay in business.  November 20 is just around the corner.  Take the time to contact your local crop insurance agent and start the planning process today.  If you don’t have an agent, contact the Florida Blueberry Growers Association.  They can help.


by FRED SIMONS, III, CLU, ChFC, Carden & Associates, Inc., [email protected]

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