Crop Insurance for Organic Farms: Time for Another Look?

Volume 13, Issue 11
November 2019

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Crop Insurance for Organic Farms: Time for Another Look?

Organic farming is one of the fastest growing segments in Northeast agriculture, with organic sales tripling from 2012 to 2017, increasing from $322 million to $1.1 billion. The Risk Management Agency (RMA) recognizes this rapidly growing segment of agriculture and has dedicated extensive resources to expand the available crop insurance coverage for organic producers. Crop insurance allows producers of a wide range of agricultural products to protect against weather and market-related losses.

Crop insurance participation by organic growers has typically been quite low in the Northeast, but several improvements in the coverage available have occurred in recent years. If your farm is organic or transitional, now might be time for a second look at the programs available to manage your weather or market risk.

Organic producers that have an organic certification by a certifying agent are eligible to insure their crops as certified organic or transitional. Certified organic producers can insure their crops at an organic price election that is more reflective of organic product values. Currently, RMA provides coverage for 80 organic crops. Certified and transitional organic producers that establish a written contract with a buyer by the acreage reporting date can utilize the Contact Price Addendum (CPA) that allows the contract price, if higher, to be used. Whole Farm Revenue Protection (WFRP) is another viable crop insurance option for organic producers that receive a higher price for their crop and maintain records to support the sold production and prices received.

Multi-Peril Crop Insurance (MPCI) provides coverage for both yield and/or revenue. Utilizing a MPCI policy requires the producer to establish a minimum of four years of production history. Production history can be established utilizing the producer’s actual records or a percentage of the county Transitional Yield.

Fruit and vegetable producers

Fruit and vegetable producers that are certified organic have several options to insure their crops at a price that is reflective of the value they receive. Producers can elect to insure between 50-85% of their yield and/or revenue at 5% increments by participating in a MPCI policy utilizing the Organic Certified price election (if applicable), the Contract Price Addendum if the crop is contracted, or they can participate in the WFRP program.

Grain producers

Grain producers that are certified organic have several options to insure their crops at a price that is more reflective of the value they receive. Producers can elect to insure between 50-85% of their yield and/or revenue at 5% increments by participating in a MPCI policy utilizing the Organic Certified price election, the Contract Price Addendum if the crop is contracted, or they can participate in the WFRP program.

For more information, visit rma.usda.gov/

Editor: Chris Laughton 
Contributors: Chris Laughton, Jeremy Forrett and Tom Cosgrove

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