1. Crop Insurance in 2011 AgriGold Seeds Meeting Ames, Iowa July 22, 2011
Chad Hart
Assistant Professor/Grain Markets Specialist 1 1

2. OLD NEW Actual Production History (APH) Yield Protection (YP)
Crop Revenue Coverage (CRC)
Revenue Assurance with
harvest price option (RA-HPO)
Revenue Protection (RP)
Revenue Protection with
harvest price exclusion
(RP-HPE)
Revenue Assurance (RA)
Income Protection (IP)

3. Acres Insured in 2010 Corn and Soybeans--Iowa

4. Acres Insured in 2011 Corn and Soybeans--Iowa

5. Yield Protection (YP) Same as old APH (or MPCI) policy
No change to APH yield determination
Projected price is the average closing futures price during February
(same as for revenue insurance)
Corn: December contract
Soybeans: November contract

6. Revenue Protection (RP)
Same as old CRC and RA-HPO
No change to APH yield determination
Projected price is the average closing futures price during February
Corn: December contract
Soybeans: November contract

7. Revenue Protection (RP)
No price election - must take 100%
Coverage levels (revenue guarantees) are between 65-85%
Harvest price is average of October futures price
Old RA corn coverage used November

8. Corn Insurance Prices
Harvest prices have been higher 3 out of last 11 years

9. Soy Insurance Prices
Harvest prices have been higher 6 out of last 11 years

10. Premiums Only one rating system for revenue policies
Similar to RA system
RP > RP-HPE > YP
May be higher or lower than before

11. What Units to Choose? Optional Units: Each farm is separate
Basic Units: Combine owned and cash rented acres in same county
Enterprise Units: Combine all acres of the same crop in same county
Whole Farm: Combine all crops in county

12. Current Subsidy Rates 60% 64% 80% 65% 59% 70% 75% 55% 77% 48% 68% 71%
Coverage level
Basic Units
Optional Units
Enterprise Units
Whole Farm Units
60%
64%
80%
not avail.
65%
59%
70%
75%
55%
77%
48%
68%
71%
85%
38%
53%
56%

13. Coverage Level Choice

14. Enterprise Units Available for YP, RP and RP-HPE
Must include at least 2 sections
CRC used acres instead of sections
At least 2 sections must have acres equal to or greater than the lesser of 20 acres or 20% of the total

15. Enterprise Units
Generally, the more acres you combine into one unit, the lower the cost per acre
Probability of collecting a payment is lower, too
But grain and dollars are commingled

16. Prevented Planting/Replant Payments
Based on Feb. futures price, not October
Replant payments are no longer based on actual costs
Replant Payments:
Corn: 8 bu. x Feb. price, per acre
Soybeans: 3 bu. x Feb. price, per acre

17. Causes of Loss for Iowa Corn, 1948-2010

18. Causes of Loss for Iowa Soy, 1955-2010

19. Premium Differences 2011 Story County, Iowa Corn 180 bushel APH
2 100-acre optional units
Revenue Protection

20. Thank you for your time. Any questions. My web site: http://www. econ
Thank you for your time! Any questions? My web site: Iowa Farm Outlook: Ag Decision Maker: