Protect Your Livelihood with Crop Insurance – Vegetable Crops Hotline

Protect Your Livelihood with Crop Insurance

This article was originally published in the August 2022 Center for Crop Diversification Newsletter. Dakota Moore is the Grower Outreach Coordinator of Kentucky Horticulture Council. You can reach Dakota at dakota@kyhortcouncil.org

“That’ll never happen to us.” “It’s always been this hot and dry.” “This storm won’t be that bad.” If the last year has taught Kentuckians anything, it’s that statements like these can easily be proven false.

To make an assumption when it comes to safety, health, and livelihood is to make a mistake. So, we build storm shelters. We use medicine and diet to keep us healthy. We even take out insurance policies on our homes and businesses. Yet very few Kentuckian specialty crop producers take the necessary steps to insure their crops, their livelihoods. The December 2021 tornado outbreak hurt some specialty crop operations, but not in the middle of production or harvest. However, the recent flooding in Eastern Kentucky has put a spotlight on just how devastating a midseason disaster can be. If your farm is your sole source of income, it needs to be protected.

Crop insurance is the best way to prevent a loss in revenue due to natural disasters like tornados, floods, and droughts. The crop insurance process can be tedious, and it’s not as easy for specialty crops as it is for row crops, but there are several options for vegetable growers, and this year things got a little easier for some.

Whole Farm Revenue Protection combines all farming operations under one policy. That means it combines vegetables, fruit, and livestock under one policy. This also includes value-added products and some post-production activities like washing and packaging. With WFRP you are insuring the revenue, not yield. If revenue dropped below the insured point, you could receive an indemnity, or payment. WFRP pulls the insured revenue from your Schedule F tax documents and requires a separate revenue for each commodity and overall expenses. That can be frustrating for larger growers. But this year, the USDA Risk Management Agency, the organization that creates crop insurance policies, launched a new Micro Farm Policy to help cut down on the amount of records required.

The new Micro Farm Policy is a type of Whole Farm Revenue Protection made specifically for direct marketing farms with revenue under $350,000 starting in 2023 season. The maximum revenue was $100,000 for the 2022 growing season. This policy combines all commodities into a single commodity code and removes the need for individual crop records and expense records. Micro Farm is meant to serve as a steppingstone for growers into the world of crop insurance.

For those wishing to insure one commodity or just insure a few of their crops, the Noninsured Crop Disaster Assistance Program, or NAP, may work better. NAP is a Farm Service Agency program covering a single commodity that can help protect against financial loss from disaster and return between 27.5% and 65% of your crop value to you. NAP also lets you use organic or direct market prices. NAP, like WFRP and Micro Farm, has some benefits for beginning, limited resource, socially disadvantaged, and veteran farmers. NAP offers a waiver of the service fee and a 50% premium reduction. WFRP and Micro Farm may have administration fees waived and some may even see premium reductions in some cases.

If you want to learn more about your crop insurance options and the next steps, check out our webpage containing videos and resources or contact dakota@kyhortcouncil.org.

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