Farmers like crop insurance change: Federal agency clarifies 'normal weather' provision
GRAND FORKS - Life has become a little simpler for farmers and crop insurers in the Upper Midwest.
The Risk Management Agency has clarified a controversial "normal weather" provision in the federal crop insurance program. Producers and crop insurers said the provision, as written, was unrealistic and confusing.
"We needed the clarification. It (the provision) was creating an enormous headache," said Mike Kozojed, an Ihry Insurance agent in Hillsboro, N.D.
Kozojed was among 40 farmers, farm group leaders and crop insurers who attended a meeting Tuesday in Grand Forks. The meeting -- led by Sen. John Hoeven, R-N.D., Sen. Heidi Heitkamp, D-N.D., and Brandon Willis, Risk Management Agency administrator -- examined changes to the federal crop insurance program announced Monday.
The federal crop insurance program, administered by the U.S. Department of Agriculture's RMA, seeks to protect crop producers from "unavoidable risk" associated with bad weather, crop disease and insects. Crop insurance policies are sold and serviced through private companies; the federal government subsidizes the program to keep it affordable.
Federal crop insurance includes prevented planting, which provides coverage when farmers are unable to plant a field. To qualify, however, farmers must have planted and harvested a crop on the field in at least one of the past four years.
Previously, the RMA, under its normal weather provision, classified 2012 as an "abnormally dry" year, preventing 2102 from counting toward the one-in-four-year requirement.
Farmers, crop insurers and others, including Hoeven and Heitkamp, insisted the provision didn't make sense and had pressed the RMA to change it.
"Who better than us to tell him (Willis) there's no such thing as normal weather" in North Dakota, Hoeven said at the Tuesday meeting.
Under the changes announced Monday, beginning in 2014, a farmer who plants and harvests a crop in one of four years, regardless of the weather situation, is eligible for prevented-planting coverage.
"I like the change. It's clear, it's understandable," said Randy Melvin, a Buffalo farmer and director of the North Dakota Corn Growers Association who attended the meeting.
Farmers and farm groups also applauded another change to prevented planting made by the RMA.
The agency is dropping a provision that disqualified farmland from prevented planting insurance if so-called "marsh vegetation," even a single cattail, is found on it.
The provision was unpopular with farmers and farm groups.
2 years in a row
A third change to prevented planting coverage has been made, as well. It applies to farmers unable to plant and harvest a field in one of the past four crop years.
In such cases, the producer will need to demonstrate the land is farmable by planting and harvesting (or incurring an insurable loss other than for excess moisture) two years in a row, according to information presented at the Tuesday meeting.
Farmers, farm group leaders and crop insurers are evaluating the new provision.
But Woody Barth, president of the North Dakota Farmers Union, said he's optimistic.
"I think this is something that can be worked through," he said.
Heitkamp and Hoeven commended Willis and the RMA for listening to farmers and crop insurance officials.