March 15 is the deadline to purchase crop insurance for the 2010 crop year. Producers need to analyze how crop insurance fits into their risk-management and grain-marketing strategies for the coming year. Farm operators are encouraged to discuss 2010 crop insurance needs and options with their crop insurance agent before the March 15 deadline.

Bottom Line On Crop Insurance Decisions:

  • View crop insurance decisions from a risk-management perspective. How much financial risk can you handle if there are greatly reduced crop yields due to weather problems and/or lower-than-expected crop prices?
  • Take the time to verify yields and keep good yield records from year to year. You can greatly enhance your insurance protection with APH or CRC and RA-HP options at little or no extra cost by doing a good job of maintaining the maximum APH on farm units.
  • There are a wide variety of crop insurance policies and coverage levels available. Make sure you are comparing apples to apples when comparing crop insurance premium costs for various options or types of crop insurance policies, and recognize the limitations of the various crop insurance products.
  • Take a good look at the 80% and 85% coverage levels, especially if you are using enterprise units or GRIP insurance policies. You will be surprised how much additional protection can be added at these higher coverage levels for a modest increase in premium costs. Many producers will be able to guarantee over $550/acre for corn and over $350/acre for soybeans.
  • Give consideration to enterprise units,GRIP or GRIP-HP policies for 2010. Enterprise units and GRIP policies become quite attractive due to significantly lower premium costs compared to optional units for CRC or RA-HP policies. However, consideration must be given to the fact that enterprise units and GRIP policies are based on larger coverage areas, and do not necessarily cover losses from isolated storms or crop damage that affect individual farm units.
  • Investigate the potential of the Biotech Yield Endorsement (BYE) on eligible corn acres. There will likely be significant premium savings with the BYE on corn acres in 2010; however, producers should find out all details of BYE prior to sign-up, and remember to follow the compliance regulations for BYE.
  • The ACRE and SURE farm programs do not replace good crop insurance coverage. Make crop insurance decisions based on the risk-management needs of the farm business, and recognize that the ACRE and SURE programs do not offer the same level of risk management and should be treated independently of crop insurance decisions.
  • Where to get more information on 2010 crop insurance alternatives? A reputable crop insurance agent is the best source of information to find out more details of the various coverage plans, to get premium quotes and to help finalize 2010 crop insurance decisions.
  • Here are some very good web sites with crop insurance information:

Editor’s note: Kent Thiesse is a former University of Minnesota Extension educator and now is Vice President of MinnStar Bank, Lake Crystal, MN. You can contact him at 507-726-2137 or via e-mail at kent.thiesse@minnstarbank.com.