Margin Protection

  PRODUCT BROCHURE

Margin Protection is a crop insurance coverage option that

provides producers with coverage against an unexpected

decrease in their operating margin caused by:

 

  • Reduced county yields
  • Reduced commodity prices
  • Increased price of selected inputs
  • Any combination of the above

Margin Protection is area based, using county-level estimates of average revenue and input costs to establish the amount of coverage and indemnity payments.

How Does It Work?

  • MP provides coverage that is based on an expected margin per acre for each applicable crop, type, and practice.
  • MP is area-based coverage and may not necessarily reflect a producer’s individual experience.
  • The Harvest Price Option allows you to choose to include replacement cost coverage to the Margin Protection policy. Similar to many popular revenue-based policies, if the harvest price is greater than the projected price, the expected margin and the trigger margin are recalculated based on the higher harvest price.

 

Determining the Margin

When determining the margin, two types of inputs are considered: those subject to price changes as listed below, and those not subject to price change (i.e. fixed from planting to harvest). Inputs not subject to price change are not specifically identified, but include: seed, machinery, operating costs (other than fuel), and similar expenses. Inputs subject to price change are identified in the Margin Provisions and include the following:

 

Allowed Inputs Subject to Price Change

Corn Diesel, Urea, Diammonium Phosphate (DAP), Potash, Interest
Soybeans Diesel, DAP, Potash, Interest
Rice Diesel, Urea, DAP, Potash, Interest
Wheat Diesel, Urea, Monoammoniu Phosphate (MAP), Potash, Interest

Coverage Levels and Premium Subsidies

Margin Protection provides coverage that is based on an expected margin for each applicable crop, type, and practice.

 

Expected Margin = Expected Revenue – Expected Costs

 

Expected revenue (per acre) is the expected county yield multiplied by a projected commodity price.

 

Expected cost (per acre) is the dollar amount determined by multiplying the quantity of each allowed input by the input’s projected price.

 

Choose an MP coverage level from 70 percent to 95 percent. This is considered relative to the expected revenue in the county.

 

ELIGIBLE INSURANCE PLANS

BENEFITS

PAYMENTS

INSURANCE TYPES AND PRACTICES

AVAILABILITY

Margin Protection is available in select counties for corn, rice, soybeans, and wheat in the states shown:

 

States Available (in select counties)

Margin Protection can be purchased by itself, or in conjunction with a Yield Protection (YP) or Revenue Protection (RP) policy purchased from the same Approved Insurance Provider that issued the Margin Protection policy. If you buy a

YP or RP policy, you will receive a Margin Protection premium credit to reflect that indemnity payments from one policy can offset payments from the other.

 

Sales Closing Dates (SCD)

September 30, 2017
Corn, Soybeans and Spring Wheat

January 31, 2018 or February 28, 2018
Rice

  • Select only the amount of protection your operation needs
  • Utilize a price discovery period that differs from other MPCI products
  • Choose the Margin Protection Harvest Price Option
  • (MP-HPO) to include replacement cost coverage
  • Gain area-based coverage at a high level while maintaining individual-based coverage by adding MP to a RP or YP base policy

Any indemnities owed will be paid when final county yields are available, in the spring of the following year.

All types and practices that are insurable for corn, rice, soybeans, and spring wheat in the respective county is listed in the Margin Protection actuarial documents.

Corn IL, IN, IA, KS, MI, MN, MO, NE , ND, OH, SD, WI
Soybeans IL, IN, IA, KS, MI, MN, MO, NE , ND, OH, SD, WI
Rice AR, CA, LA, MS, MO, TX
Wheat MN, MT, ND, SD

Insurance

Reinsurance

Location

© Copyright 2015 Farmers Mutual Hail Insurance. All Rights Reserved

Insurance

Reinsurance

Connect With Us

Connect With Us

Contact

Contact

Toll free: 800-247-5248

Toll free: 800-247-5248

Help Desk

Phone: 800-532-1581

Help Desk

Phone: 800-532-1581

Location

Reinsurance

Reinsurance