There's several new crop insurance rules and a new private insurance program to get a handle on before you buy crop insurance in 2012.
Federal crops changes
One rule changes what land is eligible for prevented planting coverage. It used to be you had to plant a crop on the land once in the past three years. In 2012, it will be once in every four years. This rule applies to the Prairie Pothole Region which encompasses South Dakota and North Dakota.
Another rule pertains to breaking new land. For land where a cropping history cannot be substantiated, such as native sod, coverage is limited to a maximum of 65% of the applicable T-yield.
Insurance companies will be allowed to approve insurability of newly broken land directly in 2012 rather than going through the Risk Management Agency's formal written agreement process if certain requirements are met, such as:
newly broken land has a substantiated history of crop production,
soils on the land are suitable for crop production (75% of more NRCS Capability Class I through IV soils) and,
the land was broken timely.
The federal crop insurance deadline for spring planted crops is March 15.
New private insurance
There's new insurance program to consider, too. It's called Total Weather Insurance, offered by Climate Corporation.
TWI covers weather events such as too much rain at planting, too little rain, too much heat or too little heat at specific times that cause yield losses.
For instance, you can insure against too much rain during your ideal planting window for corn, a lack of rain in August on your soybeans during pod fill, or too much heat during corn pollination.
This is a private insurance. There's no federal premium subsidy. It's designed to be a supplemental insurance. Federal crop covers you if you have a disaster. TWI covers you if have a weather event that cuts the top bushels out.
Interestingly, you don't actually have to suffer a yield loss to collect. If an insured event occurs you get a check within about 10 days of the event whether or not the event ends up reducing yields or not.
The earlier you order, the less expensive the premium. You can lock in the premium price anytime and cancel with no penalty up to March 15.
Learn more about TWI coverage and find an agent that sells the product at www.climate.com.
Contributing editor: Tom Bechman, Indiana Prairie Farmer