In planning for the 2021 crop season, there are many things to take into consideration regarding all the available options in crop insurance and your election of government program for your farm. Here is a brief overview of things to consider. For a more in-depth understanding of these topics, we encourage you to view a series of videos available from Williamson Crop Insurance.
New Option for 2021
Enhanced Coverage Option (ECO), is a new area plan of insurance option. It pays up to 95% of the county's expected yield and revenue and is selected in conjunction with a Revenue Protection (RP) or Yield Protection (YP) policy. It pays out in June following harvest and is a nice addition to minimize risk. If interested, speak with your crop insurance agent to discuss cost and coverage options.
The Farm Bill
The Farm Bill allows farmers to change their election of either the ARC-CO or PLC option annually now. Many who had prevented planting in 2019 may have previously chosen ARC-IND. That program does not have the same appeal as it did then so you'll probably want to choose something different. While neither ARC-CO or PLC is likely to pay in 2021 with current prices, you do have an option of adding Supplemental Coverage Options through crop insurance with the PLC election. Remember, the deadline to elect ARC-CO or PLC is March 15 through the Farm Service Agency.
There are many private crop insurance options to add to your RP plan to enhance your cash flow. Some of these don't require a claim under your RP plan to trigger a payment. They provide an extra "band" of coverage up to 95% of your yield or revenue, or both. Examples include: RAMP, ICE, ARMBand, or RPP. Discuss your options with your crop insurance agent to learn more.
As you begin planning for the spring planting season, please remember to provide your lender with your latest financial statement and a copy of your 2020 tax returns as soon as possible. Consider setting up an appointment to review your current financial situation and discuss any plans you may have for purchasing land or equipment. Lenders are available by phone, email, or by appointment at your local CNB office.