October 6, 2021

Business Tips and Tools

Risk Management Agency Develops New Policy for Apple Producers

By: Jeremy Forrett

By Jeremy Forrett and John Fitzpatrick of Farm Credit East, with contributions from Northwest Farm Credit Services and Greenstone Farm Credit Services

The Risk Management Agency’s (RMA) Apple Crop Insurance Policy has become a mainstay of risk management in the United States apple industry. There are currently over 220,000 acres insured, providing almost $1.5 billion in protection to producers. Hail, freeze, wind and drought are just a few of the natural weather perils that can impact a quality apple crop.

Apple producers have worked closely with RMA over the past 20 years to improve the Apple Crop Insurance Policy to ensure the program met the needs of the dynamic apple industry. Improvements include the addition of Varietal Group coverage, which provides more accurate pricing reflected in growers’ markets. Also added was the ability to establish unit structure by Varietal Group, which allows producers to segment their policy to provide better tailored coverage for their own farm. The working relationship between apple producers and RMA has resulted in a program that met most of the needs of the industry.

Apple Crop Insurance Program Current Participation


Policies Earning Premium

Acres Insured

Amount of Protection




$1.1 billion

New York



$133 million




$91 million




$42 million




$13 million

Source: RMA Summary of Business 2021 Crop Year as of 7/20/2021 

Since 2012, weather-related events throughout the United States have resulted in widespread crop losses that have impacted the apple industry. These weather-related events have resulted in over $800 million of indemnity payments to apple producers. During this same period, apple producers paid over $356 million in premiums for this protection. These indemnity payments provide a significant benefit to apple producers to offset the financial impact to their businesses.

The Federal Crop Insurance Program is the central component of the federal farm safety net. By law, USDA is required to operate the program in ways that “improve the actuarial soundness of the federal multiperil crop insurance coverage.” Statute requires USDA to operate the program “to achieve an overall projected loss ratio of not greater than 1.0.”

Apple Crop Insurance Program Claim History (Crop Years 2012 – 2016)


Total Premium*

Indemnities Paid

Loss Ratio





New York
















All States




Source: RMA Summary of Business as of 7/20/2021 – information available when the RMA Apple Policy evaluation began.  * Total Premium includes apple producer share of premium as well as federal premium support.

To ensure the success and sustainability of the Apple Crop Insurance Policy, RMA initiated an evaluation of the policy, including input from apple producers and industry representatives. The Apple Policy evaluation process began in late 2017 through apple producer and industry listening sessions with feedback on the current policy and recommendations on how to improve the policy. The Risk Management Agency thoroughly reviewed the information provided and recommended program modifications.

As part of the evaluation process, RMA has since reengaged the apple industry, including U.S. Apple, Approved Insurance Providers and Crop Insurance Agents to review the proposed changes and obtain additional feedback. The apple crop insurance policy will experience significant changes as a result of the evaluation process. RMA is expected to issue a draft Apple Policy for the industry to comment on later in 2021. We encourage you to participate in the public comment process as this will decide the final apple crop insurance policy. RMA plans to have the new revamped Apple Crop Insurance Policy take effect in 2023.

Tags: crop insurance, fruit

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