Crop insurance coverage claims: What you may need to understand

Jason Alexander, Vice President-Crop InsuranceBecause the USDA projects record corn and soybean yields for 2016, our regional crop yields look superior but variable across Indiana, Ohio, Kentucky and Tennessee. Though not widespread, we’ve seen pockets of drought and flooding that lowered yields and grain good quality. Some hard-hit farms are posting corn yields at just 75 to one hundred bushels per acre or less. They will not be the only ones submitting crop loss insurance coverage claims this year. For some farmers, low grain prices is going to be the greatest challenge that triggers a claim.

Nationwide, corn crop prices are seeking like they may be well below the spring guarantee corn value of $3.86. If corn is inside the $3.00 to $3.35 range, that can probably trigger many revenue-based crop insurance claims. In these market conditions, it is a fantastic notion to stay in get in touch with with your insurance coverage specialist to evaluate possible claims and their impact in your farm’s bottom line.

Claim Instance

This year, most of our claims will nearly certainly be a result of a low corn cost. But based on exactly where you're, yield loss from weather could possibly be a factor too. Take into account the following scenarios.

To begin, let’s say you've got an authorized production history (APH) of 180 bushels per acre at 80 percent income coverage, which guarantees you 144 bushels per acre. The 2016 spring price assure was $3.86. 144 bushels X $3.86 = a spring assure of $555 an acre.

Now, let’s look at how $3.00 corn this fall can put you beneath your guarantee even if you are right at your APH.

Say your average harvest this year is 180 bushels an acre, that is the same as your APH, plus the fall cost sits at $3.00. 180 bushels X $3.00 cost = $540 an acre, or $15 beneath your spring guarantee, that will trigger a income claim.

What for those who face a combination of low cost and below-average yield? Let’s say your harvest is 160 bushels per acre plus the corn price is at $3.33. 160 bushels X $3.33 value = $532 an acre, or $23 beneath your spring guarantee, also triggering a claim.

There are plenty of crop insurance questions to answer. For instance, what if your yield is at or somewhat above your guarantee however the corn value is low? What exactly is your coverage level? Is your policy on enterprise units or optional units? Did you choose 80 % or 85 percent coverage? These particulars and other people can make a massive distinction in determining should you ought to be obtaining an insurance payment and, if that's the case, just how much. Functioning closely together with your crop insurance coverage provider can assist shed light in your one of a kind situation this season.