Changes could make it easier for direct sellers to get crop insurance – SWARK Today

It’s John Lovett

U of A System Division of Agriculture

Quick facts

  • Articles from “unrelated to third parties” not necessary for small producers
  • “Production Notes” as defined by the Federal Crop Insurance Corp.
  • A new section on Direct Marketing and Verifiable Records provides guidance

FAYETTEVILLE, Ark. – Farmers and farmers who sell their produce at roadside and farmers markets can easily get crop insurance or loan repayment and latest updates to the Federal Crop Insurance Program’s Common Crop Insurance Policy.

The Federal Crop Insurance Corporation (FCIC), which is the federal agency that oversees the program, added a new section called Direct Marketing and Verifiable Records to the process to guide those who want to sell directly any part of their crops.

According to Micah Brown, a staff attorney at the National Agricultural Law Center, increasing flexibility to obtain crop insurance and put in place a policy is the goal of the changes.

“Not all manufacturers have third-party credentials to provide to verify their products,” Brown said. “For example, some producers sell their insurance products directly to consumers through on-farm or roadside, farmers’ markets, or agritourism businesses.”

FCIC requires farmers and ranchers to submit certain documents to obtain FCIP crop insurance. The new rules allowing manufacturers to file their product certifications outside of a “disinterested person,” which is someone with no relationship or business partner, Brown said. In the past farmers were required to submit their crop records from third parties or a pre-harvest inspection by their authorized insurance company to ensure that the crop is viable.

Another change in the policy requires farmers to appeal the opposition of “good agriculture” within 30 days from the notice of disagreement. In order for manufacturers to receive insurance premiums under their policy, they must comply USDA guidelines for “good agriculture.” Brown noted that farmers often produce better crops when they follow practices known to grow their own insured crops.

“Sometimes, a producer’s insurance company will deny their claim for their loss because the insurer believes that good agricultural practices were not followed,” Brown said. “Under the new policy, manufacturers have 30 days to file complaints about an insurance company’s actions with the FCIC for consideration.”

This policy change also applies to most insurance policies with a change date on or after June 30, 2022. FCIC will continue to consider the public’s comments until Oga. 29, 2022.

Producers must still support their crop insurance with “certified records” such as certified scale weight records, pick records, harvesters and daily sales records. “Production records” in the revised schedule are defined as “written records [a producer’s] actual production described on the production report.”

FCIC uses these seed production documents to verify the producer’s insurance coverage.

Brown said the new rules expand the types of legal documents that direct marketers can provide insurance, report their annual income, and file a claim under their policy.

Direct Marketing with more Verifiable Records

The new section on Direct Marketing and Verifiable Records requires producers to notify the FCIC and complete a marketing license if they intend to sell any part of their crops or do not have valid records as required by the policy. Growers must complete these two requirements by the date of their harvest report. If a farmer changes his marketing plan, he must notify FCIC no later than 15 days before harvest.

The new section also provides flexibility in generating reports. Let’s say a grower has trouble filing the required reports made under the Federal Crop Insurance Program because of the nature of their farming operation. In such cases, the Common Crop Insurance Policy allows growers to request pre-harvest testing.

“Although the pre-harvest assessment will not be used to calculate the fine if the test is done before the loss claim is made, the report obtained from such test will support the records that the producer has to participate in the Federal Crop Insurance Program. ,” Brown explained.

If timely notification is not provided to FCIC for changes, marketing certificates, and production approval documents, they will receive a yield that is 75 percent or less of the yield that FCIC used to determine how the farmer planted the previous year.

The National Agricultural Law Center is located in Fayetteville, Arkansas, but serves many of the country’s agricultural communities and is a major partner of the United States Department of Agriculture’s National Agricultural Library.

For more information about the Division of Agriculture’s research, visit the Arkansas Agricultural Experiment Station website: Follow us on Twitter at @ArkAgResearch.

For more information about the Division of Agriculture, visit Follow us on Twitter at @AgInArk.