Mississippi Crop Insurance Dates and Information

With the significant amount of flooding in the Mississippi Delta region, many producers are faced with either having to replant their crop, or they may have been prevented from planting their crop in the first place. As such, it is essential for producers to know what their crop insurance options are, and the dates that will impact these options. Table 1 contains the important crop insurance dates for corn, cotton, rice, and soybeans. The following explains what each of these dates mean.

Sales closing date is the last date to apply for crop insurance coverage. This date varies by crop and state.

Cancellation date is the last date that the producer can request cancellation of the policy for the next year.

Production reporting date is the date that producers need to report production for Actual Production History (APH), Actual Revenue History (ARH), Revenue Protection (RP), and Revenue Protection with Harvest Price Exclusion (RP-HPE) options.

Earliest planting date is the earliest that a crop can be planted and still be eligible for replanting payments. This varies by crop and state. Cotton does not have an earliest planting date because it is not covered by replant payments.

Final planting date is the last date to receive the full yield or revenue guarantee. This is different across crops and states.

End of late planting period date is the last day of the late planting period. Crops planted during the late planting period receive a reduced guarantee, typically the guarantee is reduced one percent per day for each day from the final planting date to the end of late planting period date. The length of the late planting period is different for each crop. After this date coverage is reduced to the prevented planting coverage level.

Acreage reporting date is the date that producers must report the number of acres of each insured crop that they have planted.

Premium billing date is the date that the producer will be billed for the premium and any administrative fees. However, premiums can be paid before this date. If payment is not made by the date specified in the policy then the insurance provider may assess interest on the premium balance.

End of insurance date is the last date that the producer has a guarantee on the crop. It is the earliest of the date the crop is harvested, abandoned, destroyed, the date of the final adjustment on losses is made, or the set date shown in Table 1.

Contract change date is the date that changes to the insurance policy made by Risk Management Agency (RMA) will be posted by. The producer will be able to review these changes and adjust their policy if they wish. Any change to their policy must be made by the cancellation date the following spring.

Termination date is the last date that the previous year’s premiums can be paid otherwise insurance coverage for the following year will be cancelled.

For those producers impacted by the flooding, their options are dependent on whether they had a crop planted or if they were prevented from planting at all. Producers who had a crop planted that was damaged should look into getting a replanting payment. A prevented planting payment would be for those producers who were unable to plant a crop at all. Given the time of year, it is likely that most of the impacted acres would fall under the replanting payment.

Replanting Payment

A replanting payment is a payment to help with the expenses related to replanting a crop damaged by an insurable cause of loss. In order to be eligible for a replanting payment the acres must meet the following conditions:

1. Insured crop must be damaged by an insurable cause
2. Insurance provider determines that it is practical to replant
3. Acres being replanted were planted on or after the Earliest Planting Date
4. Per acre appraisal (or appraisal plus any appraisals for uninsured causes of loss) is less than 90 percent of the per acre production guarantee for acreage intended to be replanted
5. Replanted acreage is the lesser of 20 acres or 20 percent of the insured planted acreage (only includes acreage planted before the end of the late planting period)
6. Insurance provider has agreed to replant
7. No prior replanting payment was made on the acreage during the current crop year
8. The replanted crop must be the same crop as what was initially damaged

Whether or not a replant is practical is determined by the insurance provider. Practical means that it is in the best interest of the producer and insurance provider to replant the crop. It is typically considered practical to replant until the end of the late planting period date. However, given the conditions, the insurance provider could determine it is practical to replant even after this date. Producers should discuss their options with their crop insurance agent.

If the insurance provider determines that it is not practical to replant but the producer wants to plant a second crop, the producer has two options:

1. Producer receives 100 percent indemnity on the first insured crop. A second crop is planted but the second crop is not insured
2. Producer receives 35 percent of the indemnity on the first insured crop. A second crop is planted and insured. If the second crop does not have a loss, the producer can receive the remaining 65 percent indemnity on the first crop.

In the end, it is the producer’s choice whether or not they plant a second crop. But whether or not that second crop is covered by insurance is ultimately up to the insurance provider. One other important consideration is which crop is being replanted. In order to get a replant payment the replanted crop has to be the same as what was initially damaged. However, a producer can still plant a different crop and have it eligible for a full insurance guarantee, as long as that crop is planted before the end of late planting period date. But again, if they plant a different crop they will not be eligible for the replant payment.

Unless stated otherwise, the replanting payment rate is calculated as the lesser of:

• 20 percent of the production guarantee times the projected price times the producer’s share
• Maximum bushels or pounds allowed in the policy times the projected price times the producers’ share
  • Corn maximum bushels allowed = 8 bu
  • Rice maximum pounds allowed = 400 lbs
  • Soybean maximum bushels allowed = 3 bu

The projected prices are set each spring. The 2021 projected price for corn is $4.48/bu, rice is $0.166/lb, and soybeans is $11.60/bu. These prices are also available in Table 2. All payment calculations should be shown in the production worksheet or on a special report.

Prevented Planting

A prevented planting payment is for when an insured crop was unable to be planted by the final planting date. The cause must be due to an insured cause of loss that has impacted the surrounding area and also prevents other producers from planting. In the case of being prevented from planting by the final planting date producers have several options. Producers can plant the crop during the late planting period. Crops planted during the late time period have a reduced guarantee for each day planting is delayed after the final planting date. After the end of the late planting period date the guarantee is reduced to that of the prevented planting coverage level. The producer can also decide to not plant a crop and receive the full prevented planting payment. If delayed from planting until after the end of the late planting period, the producer can plant another crop and receive a reduced prevented planting payment of 35 percent of the prevented planting guarantee. Lastly, the producer could plant a cover crop, with the restriction that it is not hayed, grazed, or harvested in any way before November 1. In this case the producer would get the entire prevented planting payment.

When a prevented planting situation occurs, the producer must provide notify their insurance agent with 72 hours after the final planting date, if not intending to plant during the late planting period, or if it is determined that planting during the late planting period is not possible. Eligibility is decided on a case-by-case basis. However, at least 20 acres or 20 percent of the crop acreage must be affected.

Prevented planting was designed to cover the pre-planting costs. The prevented planting payment is calculated as a percentage of the producer’s insurance guarantee on the impacted acres. This percentage varies from crop to crop because pre-planting costs are different between crops. For the four major commodities in Mississippi, this percentage of the guarantee is 55% for corn and rice, 50% for cotton, and 60% for soybeans. A producer can have additional coverage by paying an additional premium to increase the prevented planting percentage. This must be done by the sales closing date. For crops that have revenue or yield protection, prevented planting payments are based on the projected price, shown in Table 2. Prevented planting coverage is not available for area-based insurance.

Additional Information

Further information on all crop insurance policies for all crops, including those not discussed in this write-up, can be found on the RMA website at:

https://webapp.rma.usda.gov/apps/ActuarialInformationBrowser2021/CropCriteria.aspx

or,

https://www.rma.usda.gov/Policy-and-Procedure/Crop-Policies

This is only a brief overview of crop insurance policies. Producers should reach out to their local insurance agent to discuss their options. Any other questions can be directed to:

Brian Mills                                          Will Maples

b.mills@msstate.edu                          will.maples@msstate.edu

(662) 686-3238                                   (662) 325-2883