Coverages | MPCI | Prevented Planting

MPCI for Prevented Planting Coverage (PPC)

Prevented Planting coverage provides a payment to growers when they are unable to plant their crops due to an insurable cause. Perils covered are weather related and include drought. Prevented planting coverage for the same insured cause of loss event can continue up to two years.

What Are Its Benefits?

1. Confidence for very early (pre-plant) pre-harvest crop sales.
2. Improved risk and financial management.
3. Cash flow safety-net.
4. No additional premium is required for basic prevented planting coverage.

Dollar Guarantee

The guarantee is the protection per acre for timely planted acreage (historical yield [MPCI APH] multiplied by the level of coverage and the MPCI price election [or the higher of the early or near harvest Board of Trade futures price for the harvest contract for CRC]) multiplied by the applicable prevented planting coverage percentage. Additional prevented planting coverage levels of plus 5% and plus 10% are available for a surcharge unless these options are not provided for in the county actuarial table (not available for CAT coverage level).

Production to Count

Acreage prevented from being planted must remain idle or be planted to a cover crop to be eligible for a prevented planting payment. Production from planted acres in the unit does not count against the prevented planting guarantee (indemnity).

Maximum Eligible Prevented Planting Acres by Crop and County

Maximum eligible prevented planting crop acreage is limited to the maximum number of acres certified for APH purposes or reported for insurance for the crop in any one of the four most recent calendar years (or the number of acres specified in a processor contract). If an insured has not produced any crop for which insurance was available in any of the four most recent calendar years, eligible acres will be the number of acres specified on an intended acreage report (not to exceed the number of acres of cropland in the farming operation). Eligible acres may be increased if land is added to the farming operation, i.e., purchase or lease of additional land or acreage released from CRP.

Payment Limitations

To be eligible, first the acreage that is prevented from planting must be insurable and available for planting; and proof must be provided that inputs to produce the crop are available and that the crop was previously planted or prevented from planting. Second, the prevented planting acreage must be at least the lesser of 20 acres or 20% of the insurable crop acreage in the unit. If different crops are planted within the same field, or prevented planting is claimed on a different crop in the same field, the producer must have records to support that similar plantings occurred in the four most recent crop years.

How It Works (corn illustration)

MPCI protection for timely planted acreage		150 A. × 100 Bu./A. × 75% × $2.10 = $23,625 (Average $158/A.)
Prevented planting guarantee (+10)		$24,750 × 70%= $ 17,325
Prevented planting acreage		20 acres (lesser of 20 A. or 20% of 150 A.)
Prevented planting loss payment		20 A. × $165 × 70%= $ 2,310

Reporting Changes or Crop Damage

Producers should notify their crop insurance agent or company immediately to get specific instructions if any of the following occurs:

1. If the producer wants to make a change in the level of coverage (by sales closing date),
2. If there is a change in the farm operation, especially if additional land is added, or
3. If the crop is not timely planted.

Availability

Prevented planting coverage is available for all crops, unless otherwise specified in the specific crop provisions.

03/12/03

Note: This summary is for general illustration only. See policy for program details.