Crop Coverage Plus

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Purpose

Crop Coverage Plus (CCP) is a coverage option that provides producers more coverage and more compensation in disaster years.
Small production losses in some crops may be offset by above average yields in other crops, resulting in reduced or zero compensation in normal years.

Eligibility

CCP is available to insured producers (including landlords on a crop share basis) who insure all eligible crops at the per cent coverage level.
All insurable crops under AgriInsurance must be included in the CCP option except for:
- table and processing potatoes
- broccoli
- cabbage
- cauliflower
- carrots
- parsnips
- rutabagas
- sweet corn
- winter squash
- pumpkins
- peppers
- leeks
- cooking onions
- other onions
- Select Hay
- Basic Hay
- greenfeed
- silage corn
- pasture
- organic crops
To qualify for CCP, producers must grow more than one eligible crop.
March 31 is the last day to select CCP, make changes to (add or delete crops and change coverage levels), or to cancel AgriInsurance.
June 30 is the last day to file Seeded Acreage Reports, and November 30 is the last day to file Harvested Production Reports.

Coverage

All eligible crops are combined into a single Production Value Guarantee.
The Production Value Guarantee is the sum of the dollar coverage for all crops, where dollar coverage for each crop equals Probable Yield, multiplied by the Dollar Value, multiplied by the acres, multiplied by the coverage level.
The coverage level for all CCP crops will be greater than per cent, up to a maximum of per cent.
If the calculated coverage level does not exceed per cent, CCP is not in effect and all crops will be insured individually at the per cent coverage level.

Coverage (cont'd)

The coverage level is not determined until all acres of all eligible CCP crops are sown and reported on a producer’s Seeded Acreage Report.
The coverage level calculation accounts for the historical accumulated risks associated with growing a specific acreage of a combination of crops.

Cost

Premiums are the same as the premium for the per cent coverage level, because over time a producer receives similar benefits.
Although producers with CCP will not have as many claims as they would have with individually selected crops, the payout will be greater when a significant yield loss occurs.
A premium discount will be applied if the combination of crops grown results in a coverage level over the per cent maximum.

Claims

Offsetting production between crops does occur. A good yield from one crop may reduce any potential payment on another crop. CCP offers higher coverage for the farm but will usually only trigger when there is a significant yield or quality loss.
Losses are determined as follows:
1. Calculate the value of each crop by multiplying the production of each crop by its Dollar Value.
2. Add the value of production from all CCP crops together, which results in a production value.
3. Subtract the production value from the Production Value Guarantee.
MASC Dollar Values are used to determine the guarantee, not the current market values. CCP insures for production losses, it is not a price guarantee.
Any acreage of a crop that is destroyed and reseeded is not used to calculate the CCP coverage level. However, the reseed benefit will be calculated using the higher CCP coverage level.
With the exception of reseed claims, no payments will be made for CCP until all eligible crops have been harvested. This is due to the fact that one crop may offset a loss to another crop (i.e. there are no payments for Stage 1 or Stage 2 losses on individual crops).
Reseed claims will be paid on a per crop basis (usually by the end of July) once MASC has confirmed that reseeding has been completed.

Crop Coverage Plus / AgriInsurance Claim Scenarios

Crop Coverage Plus coverage levels are calculated based on the specific crops seeded and their ability to offset each other over time. A coverage level will be calculated for each farm, which can range anywhere from per cent coverage to per cent coverage, depending on Risk Area and acres of each crop seeded.

The following scenarios compare Crop Coverage Plus to traditional AgriInsurance in various claim situations. Note that the premium cost for traditional AgriInsurance coverage at per cent is the same as the premium cost for Crop Coverage Plus coverage at per cent.

In all scenarios, the producer has the same Probable Yield, Dollar Value, seeded acres, etc. as listed below, and the Crop Coverage Plus coverage level is calculated at per cent. Only the harvested yield (bu/ac) and calculations change in each example.

Table 1

Crop	Dollar Value ($/bu)	Producer Premium	AgriInsurance Coverage @ per cent (A)	Crop Coverage Plus Coverage @ per cent (B)
Wheat	$	$6,824.00	$	$
Barley	$	$4,520.00	$	$
Canola	$	$3,651.00	$	$
Flax	$	$1,607.00	$	$
Totals		$16,602.00	$	$

To calculate the AgriInsurance Indemnity for each crop in each scenario:

Subtract the Harvested Production Value from the AgriInsurance Coverage @ per cent (in Table 1):

AgriInsurance Indemnity = Column A (Table 1) - Column C (each scenario)

To calculate the Crop Coverage Plus Indemnity in each scenario:

Subtract the total Harvested Production Value from the total CCP Coverage @ per cent (in Table 1):

Crop Coverage Plus Indemnity = Column B Total (Table 1) - Column C Total (each scenario)

Scenario 1: All Crop Yields are Well Below Average

Crop	Harvested Production Value (C)	AgriInsurance Indemnities @ per cent (A - C per crop)	Crop Coverage Plus Indemnity (B - C, totals only)
Wheat	$	$
Barley	$	$
Canola	$	$
Flax	$	$
Totals	$	$	$

Net Result of Scenario 1:
Producer will receive $ ($ - $) more in indemnity under Crop Coverage Plus for the same total premium cost as traditional AgriInsurance.

Scenario 2: All Crop Yields are Slightly Below Average

Crop	Harvested Production Value (C)	AgriInsurance Indemnities @ per cent (A - C per crop)	Crop Coverage Plus Indemnity (B - C, totals only)
Wheat	$	$
Barley	$	$
Canola	$	$
Flax	$	$
Totals	$	$	$

Net Result of Scenario 2:
Producer will receive $ total indemnity under Crop Coverage Plus and zero indemnity under traditional AgriInsurance.

Scenario 3: Two Crops Below Average, Two Crops Near Average

Crop	Harvested Production Value (C)	AgriInsurance Indemnities @ per cent (A - C per crop)	Crop Coverage Plus Indemnity (B - C, totals only)
Wheat	$	$
Barley	$	$
Canola	$	$
Flax	$	$
Totals	$	$	$

Net Result of Scenario 3:
Producer will receive a similar indemnity from Crop Coverage Plus or traditional AgriInsurance.

Scenario 4: Two Crops Below Average, Two Crops Above Average

Crop	Harvested Production Value (C)	AgriInsurance Indemnities @ per cent (A - C per crop)	Crop Coverage Plus Indemnity (B - C, totals only)
Wheat	$	$
Barley	$	$
Canola	$	$
Flax	$	$
Totals	$	$	$

Net Result of Scenario 4:
Producer will receive $ total indemnity from traditional AgriInsurance but no indemnity under Crop Coverage Plus.

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