Dec 1, 2022

USDA specialty crop, organic insurance expands

Through upgrades and expansions of current U.S. Department of Agriculture crop insurance policies, including policies for specialty crop and organic crops, there have never been better or more reasonable opportunities for growers to manage their risk.

The new programs include Micro Farm Crop Insurance, Whole Farm Revenue Protection (WFRP) and Transitional and Organic Grower Assistance (TOGA). 

Micro-Farm Crop Insurance

This new policy available for growers, including Specialty and Organic/Transitional, is a simplified version of Whole Farm Revenue Protection. The USDA’s Risk Management Agency created Micro-Farm Crop Insurance for producers with an approved average revenue of less than $350,000 annually. Micro-Farm is a heavily subsidized policy, which results in relatively low premium for producers compared to individual crop policies. This is a simple form of the Whole Farm Revenue Protection policy that provides a revenue safety net for all commodities combined on your farm. 

Micro-Farm provides protection against the loss of insured revenue due to unavoidable natural causes of loss during the insurance period. Under this policy, insured revenue can also include added-value products, such as lotions and wine. Growers who take Micro-Farm are ineligible to utilize any other underlying policy, except for Noninsured Crop Disaster Assistance Program (NAP) coverages.

Coverage levels range from 50-85%, with an 80% premium subsidy through 75%, and lower for coverage levels of 80-85%. Sales close for late fiscal tax filers is Nov. 20 and March 15 for calendar-year filers. Note that producers can participate in Micro-Farm or WFRP as well as the USDA-Farm Service Agency’s NAP coverage. While indemnities can be collected from both programs for the same crop/crop year, NAP payments will be limited to the deductible amount of the Micro-Farm/WFPR policy. 

Highlights of Micro-Farm and WFRP for 2023 include:

• Micro-Farm is limited to growers with less than $350,000 in approved annual revenue per entity, and its big brother WFRP has a liability limit of $17 million per entity.
• Grower Premiums

1.  Premiums are subsidized by 80% for coverage levels of 50-75% for Micro-Farm and WFRP;
2.  There is an additional 10% subsidy for Beginning or Veteran Farmer Ranchers (with less than 10 years of farming history) for Micro-Farm and WFRP programs; and
3.  There is an additional 10% subsidy through the 2023 TOGA program for entities producing any certified organic or transitional crops for Micro-Farm and WFRP.

Add the above three subsidies together, and some growers may qualify for a zero premium revenue policy!

Highlights of the TOGA premium benefits include: 

• Ten percentage points of premium subsidy for all crops in transition, (for individual crop policies, if available);
• Five-dollar per acre premium benefit for certified organic grain and feed crops; and
• For individual crop policies, if available, 10 percentage points of premium subsidy for all WFRP policies covering any number of crops in transition to organic or crops with the certified organic practice. Producers who have additional individual crop insurance policies will also receive the applicable premium assistance on those policies.

We encourage all organic and specialty producers to reach out to discuss crop insurance options, especially growers that fit under the $350,000 cap for Micro-Farm and those larger diverse growers that want to explore insuring up to $17 million in crop revenue. Though for most producers the sales close is not until March 15, 2023, it is important to make the decision prior to Nov. 20 if any underlying or NAP coverages need to be modified or canceled. 

Please reach out to discuss what these new options mean for you, and how they can help you manage your risk effectively.

— Cory Blumerick, specialty crop insurance manager for GreenStone Farm Credit Services