Crop insurance: Follow the rules to ensure the best outcome

2012 may be the year of crop insurance so make sure you are following the rules. Farms covered by crop insurance should take notice of the rules before removing or destroying drought damaged crops.

When it comes to what to do with damaged crops covered by crop insurance, if in doubt, please ask! Calls and questions are frequently coming in to Michigan State University Extension educators and we want people to make well informed decisions that do not cause negative outcomes for this year’s crop insurance claims. For any crop or acreage that is covered under one of the several crop insurance programs it is vital that the farm producer check with their crop insurance agent before taking any actions on those acres. Reading and understanding all the fine print in your crop insurance policy may require their professional interpretation.

For example, chopping off nearly dead corn fields for silage/stover just to make a little feed for cattle will be considered as harvesting a crop. The value of that silage/stover will then be deducted from the potential payout from any crop insurance on that farm’s field. Even if you give the salvage crop away and receive no payment or benefit, its value will be deducted from crop insurance settlement payments for this year’s crop.

To be safe, a farm should:

  1. Contact their crop insurance agent and declare that they have a crop loss.
  2. If the farm wants to destroy (work down) or chop off the dead or dying remaining crop, first have that crop appraised by your crop insurance company representative, or follow other instructions your crop insurance agent gives you. With the size of this year’s crop disaster across most of the country, it is very possible that it will take an extended period of time to get a response or someone to your farm to do a loss appraisal, but you do need to wait.
  3. If any crop is harvested and placed in a bunk or silo with any remaining 2011 crops, a farm will need to mark the storage and do a good job of documenting the amount of crop remaining. Be sure you have the information in the format they will require to verify the actual amount of crop harvested.

Resources and information about crop insurance is available on the Risk Management Agency (RMA) website and the USDA Crop Insurance website.

The policies of each crop insurance company may vary slightly as to how and what a farm needs to do to completely comply. Talk to your crop insurance agent before doing anything to remove a weather damaged crop.

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