University of Maryland Extension

Crop insurance

Author: 
Nicole Cook, B.S., J.D., LL.M., Environmental and Agricultural, Faculty Legal Specialist, Agriculture Law Education Initiative (ALEI), University of Maryland Eastern Shore

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Crop insurance protects against either the loss of crops due to natural disasters or the loss of revenue due to declines in the prices of agricultural commodities. It is federally supported and is sold and serviced by certain approved private-sector crop insurance companies and agents.

Whole-farm revenue protection (WFRP)

Provides a risk management safety net for farms of all sizes that produce two or more commodities. Coverage is provided under one insurance policy, and is available in all counties nationwide. This insurance plan is tailored for any farm with up to $8.5 million in insured revenue, including farms with specialty or organic commodities (both crops and livestock), or those like urban farms that are marketing to local, regional, farm-identity preserved, specialty, or direct markets.

For more information, visit https://www.rma.usda.gov/Policy-and-Procedure/Insurance-Plans/Whole-Farm...

The Noninsured Crop Disaster Assistance Program (NAP)

Covers commercial crops. There is no minimum size of an operation (meaning that small urban farmers can take advantage of risk protection for their commercial operations that traditionally would not have crop insurance available to them) in order to be eligible for NAP.

The 2018 Farm Bill re-authorized incentives for NAP coverage for socially disadvantaged, limited resource, or beginning farmers. Although NAP does not cover home gardens (because they are not ordinarily viewed as commercial enterprises), NAP does provide risk coverage for producers who may commercially produce small crop acreage in an area for local or direct markets.

Contact your local Farm Service Agency Service Center to learn about more about NAP coverage for your farm. You can locate your local FSA office and get more information about NAP at https://www.fsa.usda.gov/state-offices/index

Other types of crop insurance

Crop-Hail Insurance is a type of insurance that insures against crop damage caused by rain and hail, but it can also cover damage due to fire, wind, lighting, and vandalism. It typically protects crops that are still in the field and have yet to be harvested. Hail damage is not covered under the federal crop insurance program. Farms with large field crops in areas with high risk of hail damage typically purchase hail insurance.

Information about Crop Insurance is available at http://www.ag-risk.org/AboutCropInsurance/default.htm

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