Supplemental Coverage Option

Product Booklet

The Supplemental Coverage Option (SCO) is a county-level revenue-based or yield-based optional endorsement that covers a portion of losses not covered by the same crop’s underlying crop insurance policy.

SCO can be elected only when a producer has purchased one of the following underlying plans of insurance:

  • Yield Protection
  • Revenue Protection
  • Revenue Protection with Harvest Price Exclusion


SCO is available in select counties for spring barley, corn, soybeans, wheat, sorghum, cotton, rice, blueberries, and apples.

PURCHASING SCO


First, you must choose an underlying policy:

  • Yield Protection
  • Revenue Protection
  • Revenue Protection with the Harvest Price Exclusion

Next, you choose SCO as an endorsement to the underlying policy. You must make this choice by the sales closing date for your underlying policy, and with the same insurance company.

Any crop on a farm that you elect to participate in the Agriculture Risk Coverage (ARC) program is not eligible for SCO coverage.

 

 

The Federal Government pays 65 percent of the premium. The exact premium cost depends on the crop, county, coverage level you choose, and the type of coverage you choose, such as Yield Protection or Revenue Protection.
 
SCO is a continuous option – it must be cancelled by the cancellation date. All applicable CCIP, Crop, and SP provision/dates from the underlying policy will apply to SCO.
 
SCO does not provide coverage for Prevented Planting or Replanting.
 
There is an additional administrative fee per crop/county for adding SCO.

 

Looking for individual protection with your SCO coverage?

Talk to your FMH agent about adding the SCO+™ endorsement for individual protection above your county-based plan.
For more details, check out the product brochure.

BROCHURE

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Sample Calculations

SCO-Calculation
  • The SCO Endorsement begins to pay when county average revenue falls below 86 percent of its expected level (the percent is the same for all SCO policies).
      
  • The full amount of the SCO coverage is paid out when the county average revenue falls to the coverage level of the underlying MPCI policy.

    Example: MPCI Coverage Level - 75%
      
  • The dollar amount of SCO coverage is based on the percent of crop value covered by calculating the difference between 86 percent and the MPCI coverage level.

    Example 86% - 75% = 11% covered by SCO
      
  • Determine the full amount of SCO coverage by multiplying the percent covered by SCO by the Expected Crop Value.

    Example: 11% x $763.80/ac = $84.02/ac max SCO average
      
  • For the example, the SCO policy can cover up to $84.02 of the amount not covered by the underlying MPCI policy.

Additional Information

Availability
SCO must be elected by crop. It is available in select counties for the following crops:
  • Spring Barley
  • Corn
  • Soybeans
  • Wheat
  • Sorghum
  • Cotton
  • Rice


Coverage Levels and Premium Subsidies
  • Premium rates are generally released in November of each year for spring crops
  • Includes separate administrative fee
  • Billing dates match underlying policy billing dates
  • Federal subsidy amount: 65%
Loss Requirements and Triggers
SCO differs from the underlying policy in how a loss payment is triggered.
  • The underlying policy pays a loss on an individual unit basis and an indemnity is triggered when you have an individual loss in yield or revenue.
  • SCO pays a loss on an area basis, and an indemnity is triggered when there is a county level loss in yield or revenue.


Payments

SCO payments are determined only by county average revenue or yield, and are not affected by whether you receive a payment from your underlying policy. It is possible to experience an individual loss but to not receive an SCO payment, or vice-versa.