Crop Insurance for Pennsylvania Fruit Crops

Multi-peril crop insurance is a valuable risk management tool that allows you to insure against losses on your farm due to adverse weather conditions and unavoidable pests and diseases. It shifts unavoidable production risks to an insurance company for the payment of a fixed amount of premium per acre. In recent years, around $500 million in crop insurance protection has been purchased by agricultural producers annually in Pennsylvania. Nearly $400 million has been paid to farmers for losses in the past ten years. Hail is the largest cause of loss in fruit crops (27%), followed by freeze (25%) and excess moisture (18%) (Table 1).

The crop insurance program is the centerpiece of the Federal government's effort to provide a safety net for farmers. Crop insurance is available nationwide and gives you the freedom to choose the level of coverage you need based on your own risk experiences and preferences. A wide range of insurance plans are available for over 100 commodities (a listing of various types of coverage can be found on the USDA-Risk Management Agency's website. A minimum level of crop insurance, called Catastrophic Risk Protection or CAT insurance, is available to all farmers regardless of size. There is no premium cost (all premiums are paid by the federal government) for CAT coverage; there is however an administrative fee of $655 for each crop insured in a county. Higher levels of crop insurance (buy-up protection) are also federally subsidized, with farmers nationwide paying only 33 to 62 percent of the actual cost of the insurance (depending on the level of coverage selected). Under the 2018 Farm Bill, to be eligible for future disaster assistance programs you must obtain a policy or plan of insurance for all crops (with limited exceptions) through either crop insurance or the noninsured assistance program (NAP, available through USDA-Farm Service Agency). To be eligible for crop insurance subsidies, you must also be in conservation compliance, demonstrating that your operation conforms to highly erodible land and wetland conservation provisions.

Crop insurance policies are available for at least one commodity in every county in Pennsylvania, with a total of 36 policies available to provide protection for a wide variety of agricultural businesses. Fruit crops covered include apples, nectarines, peaches, grapes, and pears. Although fruit crops only account for a small proportion of all the acres covered by crop insurance in Pennsylvania, they represent a high value of insurance coverage sold on a per acre basis.

Before selecting a given crop insurance policy or level of protection, you should first consider how much financial risk you are willing and able to bear and what you need to protect. Some common risk-management objectives are:

• introducing the types of crop insurance products available.
• explaining how an actual production history (APH) is calculated.
• discussing what is meant by insurance units.
• illustrating how insurance premiums and loss payments are calculated.
• comparing the cost of crop insurance and the levels of cash-flow protection available.
• listing important crop insurance deadlines in Pennsylvania.

Types of Crop Insurance Plans

Fruit growers can purchase yield protection crop insurance and whole-farm revenue protection. Yield protection coverage at various levels of protection is available for four fruit crops in certain Pennsylvania counties. Revenue-based insurance protection is also available on a whole-farm basis (Whole-Farm Revenue Protection, WFRP) in every county in Pennsylvania. A complete listing of crop insurance availability by county is included at the end of this publication.

If crop insurance is not available for your fruit crop in your county, coverage may still be available via a written agreement. If you are in a county where premium rates are not on file for a crop which is insured elsewhere in the U.S., you may be able to get protection via a written agreement, providing that you have sufficient production records. For example, some blueberry, plum, and apricot growers have purchased crop insurance although they are not crops typically insured in Pennsylvania. Contact a crop insurance agent for more information on using written agreements.

Before considering a given crop insurance policy or level of protection, you should first think carefully how much financial risk you are willing and able to bear and what you need to protect. The following are some common objectives:

1. reducing year-to-year income variability.
2. providing a minimum cash flow to cover input costs.
3. securing adequate credit.

Yield protection (APH) insurance protects you against losses due to natural causes such as drought, excessive moisture, hail, wind, frost, and unavoidable insects and diseases. For apples, peaches/nectarines, and pears you select from 50 to 75 percent (in 5 percent increments) of the amount of your average yield to insure. For grapes you select from 50 to 85 percent (in 5 percent increments) of the amount of your average yield to insure. You can also select between 55 and 100 percent of the crop price determined annually by the USDA's Risk Management Agency (referred to as the "projected price"). If your production is less than the yield insured, you are paid for the loss based on the difference multiplied by the price you selected when the crop insurance was purchased.

Apples are covered by crop insurance in 37 Pennsylvania counties. Peaches/nectarines are covered in 30 counties. Pears are only covered in Adams County. Grapes are only covered in Adams, Berks, Chester, Erie, Lancaster, and Schuylkill Counties.  Apples are not insurable until they have produced at least 150 bushels per acre. Peaches are not insurable until they have reached the fourth growing season after being set out. Pears are not insurable unless they have produced at least 5 tons per acre. Grapes for juice or wine are not insurable until they have produced an average of at least 2 tons per acre in at least one of the previous three crop years.

Organically grown crops may also be eligible for crop insurance coverage. Coverage is available for certified organic and transitional acreage. When reporting acreage, you must have written certification for your organic and transitional acreage and records from a certifying agency of the location of your organic production. Organic price elections are determined by RMA for the current crop year. Premiums may be adjusted to recognize any additional risk associated with covering organic crop acreage. Coverage for organic crops sometimes requires use of a written agreement, check with your crop insurance agent for more information.

Catastrophic Risk Protection (CAT) is an insurance-based producer safety net that provides a minimum level of protection against crop losses that reflects your actual production history. Per acre insurance premiums for CAT are totally paid by the federal government. For a flat application fee of $655/crop/county, you get a crop insurance yield guarantee of 50 percent of your operation's actual production history yield, with any losses reimbursed at 55 percent of the established crop price. Compared to higher levels of coverage, CAT provides only a low level of protection against yield losses. For some diversified growers this low level of coverage may be enough to protect them against severe cash-flow shortfalls. However, because of the high administrative fee charged for CAT coverage, many smaller growers may be able to obtain higher levels of protection at less overall cost per acre with buy-up levels of coverage available through a yield protection policy.

Supplemental Coverage Option (SCO) is a crop insurance option that is available on a limited basis for apples, peaches, and grapes that provides additional county-level coverage for a portion of your underlying crop insurance policy deductible. You buy SCO as an endorsement to your eligible Yield Protection policy. The amount of SCO coverage you can purchase is based on the level of protection in your individual crop insurance policy. SCO coverage begins to pay when the county average yield or revenue for the crop falls below 86 percent of its expected level. The maximum amount of your SCO coverage is paid out when the county average yield or revenue falls to the coverage level of your underlying crop insurance policy. The Federal Government pays 65 percent of the premium cost for SCO.

Apple Tree Insurance is now available to provide protection against tree losses. This policy provides a tree-based dollar amount of insurance protection and covers the same perils as yield insurance (with the exception of losses due to an inadequately constructed trellis system). Trees are eligible for fire blight coverage if they do not have visible signs of infection during a pre-acceptance inspection.  If fire blight subsequently infects the tree or orchard, you may be able to claim an indemnity as long as recommended fire blight prevention and control practices have been followed.

Under this policy, apple trees are insurable by varietal group, planting density (standard or high-density), as organic or non-organic, and by three stages of production (tree ages). Stage I is defined as 1 year-old trees in high-density orchards and 1-2 year-old trees in standard-density orchards. Stage II is defined as 2 to 3 year-old trees in high-density orchards and 3-6 year-old trees in standard-density orchards. Stage III is defined as 4 or more year-old trees in high-density orchards and 7 or more year-old trees in standard-density orchards. Indemnity prices vary depending on varietal group, planting density, and stage.

Hurricane Insurance Protection-Wind Index (HIP-WI) Endorsement can help cover some of the deductible in your underlying crop insurance policy when your county, or a county adjacent to it, is declared to have experienced sustained hurricane-force winds from a named hurricane.  The hurricane insurance protection-wind index (HIP-WI) endorsement can be added to your crop insurance coverage in Berks, Bucks, Chester, Delaware, Lancaster, Lehigh, Montgomery, Northampton, and Philadelphia Counties.

Settlement of any claims will be made within 30 days after the list of counties identified as meeting the county loss trigger is determined by the National Hurricane Center (NHC) at the National Oceanic and Atmospheric Administration (NOAA).

To be eligible for the HIP-WI Endorsement, you must:

• Have an underlying crop insurance policy
• Elect HIP-WI on or before the sales closing date for the underlying policy
• Elect a HIP-WI coverage percentage; and
• Comply with all terms and conditions of the HIP-WI Endorsement.

Because this is an index-based insurance product, there are no separate acreage reporting requirements and you are not required to file a notice of loss. There is a separate administrative fee and premium charged for participation in this optional coverage. The premium subsidy for this program is 65%

Whole-Farm Revenue Protection (WFRP) insures the revenue of your entire farm rather than individual crops by guaranteeing a percentage of your approved farm revenue. You can buy WFRP alone or with other buy-up level crop insurance policies. For example, if you raise apples and peaches along with small fruits and vegetables, you could cover your apples and peaches under individual crop insurance policies and use WFRP as an umbrella policy over the rest of your operation. You cannot use CAT coverage with WFRP.

WFRP uses information from your Schedule F tax records (or a "Substitute Schedule F for WFRP Purposes" if you do not file a Schedule F) from the past five consecutive years of to calculate the policy's approved revenue guarantee. Operations that have expanded over time may be allowed to increase the approved revenue amount based on an indexing procedure. Depending on the number of commodities grown, you have the choice of coverage of 50-85% of your approved revenue (CAT level coverage is not available for WFRP). Coverage and premium costs depend on the level of diversification in your operation; the maximum level of insured revenue is $8.5 million (based on maximum adjusted gross revenues of $17.0 million and the 50% coverage level). WFRP also provides replant coverage if it not already covered under an underlying individual crop policy.

Claims for losses under WFRP are settled after taxes are filed for the insurance year. The sign-up deadline is March 15 for calendar year and early fiscal year tax filers and November 20 for late fiscal year tax filers.

Although WFRP may be a good option for many horticultural crop producers, it may not cover your losses if you are purchasing crops from other growers for resale. This is potential problem in direct marketing situations if you make up a shortfall in your own production by purchasing crops from other sources. Because WFRP is a revenue-based policy you would not have the basis for a claim if your revenues are still high enough (although in this situation your costs would also be higher than normal). More information on WFRP can be found at the USDA Risk Management Agency WFRP website.

Fruit Losses Not Covered by Crop Insurance

There are several types of losses that are not covered under a basic crop insurance policy. The inability to market for any other reason than actual damage from an insurable cause is not covered for all fruit crops (including the inability to market because of quarantine, boycott, or refusal to accept production). In addition, fire damage is not covered if weeds and undergrowth are not controlled or if un-mulched pruning debris is not removed from the orchard or vineyard.

For apples, losses not covered by crop insurance include market fluctuations, mechanical damage, damage caused by improper or insufficient insect or disease control measures, russeting, and failure of the fruit to size, shape, or color properly.  Optional coverages are available to cover quality related losses in apples. To establish the basis for any crop insurance claim, it is critical that your apples should be graded prior to sale or storage. Failure to do so will result in all your apples being treated as marketable production for insurance purposes.

Peaches and nectarines are not covered for split pits. Grapes are not covered for losses due to phylloxera. If market fluctuations are a potential risk you face, a WFRP policy may be a good option to consider.

Price Elections for Fruit Growers

Fruit growers also have the option of using an indemnity price that reflects their market for the crop. Apple growers have several options, including the choice of a fresh-market, processing, or varietal group price. In order to be eligible for coverage as fresh-market fruit, you must provide records showing that at least 50 percent of your apple acreage was sold as fresh fruit in one of the past four years. There is also optional coverage for fruit quality losses from hail damage to both fresh-market and processing apples. In addition, an option is available for fresh-market apples that covers losses (hail, sunburn, and failure to color properly) from fruit that fails to grade U.S. Fancy or better. For peaches, growers choose either a fresh-market or a processing price. For grapes, indemnity prices have been divided into 41 types/varietal groups that cover a wide range of native grapes, French-American hybrids, and Vinifera cultivars.

Crop Insurance Coverage for Organic Farmers

Organically grown crops may also be eligible for crop insurance coverage. Coverage is available for certified organic acreage, transitional acreage, and buffer zones. When reporting acreage, you must have written certification for your organic and transitional acreage and records from a certifying agency of the location of your organic production. Organic price elections or insurance dollar amounts are determined by RMA for the current crop year. Premiums may be adjusted to recognize any additional risk associated with covering organic crop acreage. Coverage for organic crops sometimes requires use of a written agreement; check with your crop insurance agent for more information.

Determining Your Actual Production History

The first step in developing a crop insurance program is to establish your actual production history (APH). Assessing the need for crop insurance protection must be based on your operation's production potential and risk exposure. It is a good idea to establish the APH for each insurance unit with a crop insurance agent long before the sign-up date. An APH yield is needed even if you are only interested in the catastrophic (CAT) level of coverage.

Establishing an APH yield requires a minimum of four years of records for each crop and land unit to be insured. Examples of information used to prove crop yields include field records, sale receipts, and farm or commercial storage records. The records must be for continuous years, starting with the most recent year and continuing back in time. Once a missing year is reached, no yield data before that year may be used. Dropping out a yield from one year because of poor production is not allowed.

If at least four successive years of records are not available, a transitional or T-yield is substituted for each missing year. Each insured crop within a county has an assigned T-yield. It is usually based on the latest available 10-year county average yield. Established growers with no records at all are assigned 65 percent of the T-yield as their APH yield. Growers with one year of records receive 80 percent of the T-yield for the other three years to calculate their APH yield. Growers with two years of records receive 90 percent of the T-yield for the other two years. Growers with three years of records receive 100 percent of the T-yield for the one remaining year. Once each year has been assigned a yield, the APH is an average of the four yields. If only a couple years of yield records exist, the APH yield may be considerably below the actual expected yield, because of the reduced T-yields.

New growers or those who have never planted the crop to be in the county to be insured receive 100 percent of the T-yield for determining their APH yield. If they continue to plant the crop for four years, the T-yields will be replaced with the actual production each year. New growers who have been closely associated with a particular farming operation, such as a child or someone else who has been actively involved in the management of the farm in prior years, may be able to use the previous operator's records to establish their APH yield.

When at least four years of production history is available, the APH is the average of all yearly reported yields. Additional years of data will be averaged into the APH yield until a maximum of 5 years for apples and nectarines/peaches or 10 years for pears and grapes are included. Once the maximum number of years of yields are available, the APH becomes a moving average. When a new year of production history is added, the oldest record is dropped from the APH calculation.

Generally, when a new yield record is added to your APH history, the APH cannot decrease by more than 10 percent in any one year. The APH cannot fall to less than 70 percent of the T-yield for growers with only one year of yield records, 75 percent for growers with two to four years of yield records, or 80 percent for growers with five or more years of yield records. This "floor" prevents one year with a severe crop failure from having a disproportionately large influence on your APH yield, especially when only a few years of yield records are available. There is also an option to substitute 60 percent of the T-yield for actual yields that are less than 60 percent of the T-yield.  There is a slightly higher premium when this option is selected.

Selecting an Insurance Unit for Crop Insurance

As a fruit grower you have two options on how you divide your land to determine APH yields, loss payments, and premiums under crop insurance. Each parcel of land for which claims are calculated is called an "insurance unit." Unit types include basic and optional units. One farming operation may have several insurance units. In this situation, it is possible to have a crop loss on one unit and receive a loss payment, while the other units on the same farm produce a record crop. As a result, many growers prefer to divide their land into as many units as possible. You should check with a crop insurance agent to find out how many and what type of insurance units your crops qualify for, and how this could affect your premiums.

Basic units. You receive one basic unit for the land you own and cash rent within a county. You also receive one basic unit for each landlord with whom you crop share rent. Each crop share landowner can also insure his own interest in the crop as a separate unit. Each different crop also creates a separate unit, and tracts of land in different counties must be insured as separate policies with separate units. Each crop/county can have a different type of policy and level of coverage and could receive a loss payment separate from the other units. Separate production records must be kept for each basic unit. Insuring all your acreage as basic units will lower your premiums by approximately 10 percent. CAT policies are only eligible for basic units.

Optional units.  Basic units may be divided into optional units when a crop is being grown under distinctly different production practices. For example, you may use optional units to divide land by varietal groups. Special farming types or practices may also qualify acres to be insured as optional units. For example, a grower with both irrigated and non-irrigated acres of the same crop may qualify for optional units. Optional units may also be established by FSA farm serial number. Apple and peach growers have the choice to divide their production by type, so that they can have an optional unit for fresh-market fruit and an optional unit for processing fruit. This also allows you to select different coverage levels for your fresh-market and processing apple acreage. You may also be able to divide non-contiguous blocks into separate units. Separate APH records must be reported for each optional unit, and you would not receive the 10 percent premium discount allowed for basic units.

How Crop Insurance Premiums are Calculated

Crop insurance premiums depend on your actual production history (APH yield), the coverage level you prefer, the price election you select, your chosen unit structure, and the county premium rate where you farm. Based on the level of coverage and the crop being insured, you pay between 33 and 62 percent of the calculated premium, with the federal government paying the balance. If you use basic units rather than optional units, you are eligible for an additional premium discount.

You can select a coverage level of 50, 55, 60, 65, 70, or 75 percent of your APH yield. By multiplying your APH yield by the coverage level you select, you calculate your yield guarantee, which is the trigger level for receiving a payment for yield losses from the insurance company. In a sense, selecting a coverage level establishes your "deductible," similar to the deductible on your automobile or homeowner's insurance. For example, if a coverage level of 75 percent is selected, then you "self-insure" for the first 25 percent of the loss. If the loss is more than 25 percent, crop insurance would cover the difference. Like other insurance, high levels of deductible have lower premiums, but also leave you with more risk. You also have some choice of the price election (percent of the established crop price), depending on the yield guarantee selected. Selecting a lower level of price election would lower your premiums. In practice, however, most growers select the 100 percent price election.

An important thing to remember about crop insurance premiums is that premium rates are directly tied to your APH yield, the projected price or price elections, and any optional coverage you choose for the crop that you are insuring. Whenever projected prices and optional coverage change, your amount of crop insurance protection and premiums will also change.

Some important crop insurance equations

Yield protection policy guarantees and premiums:

• Yield guarantee = APH yield x coverage level
• Total premium/acre = Yield guarantee x price election x county premium rate
• Subsidy amount = Total premium/acre x subsidy factor
• Producer premium/acre = Total premium/acre – subsidy amount

 Yield protection policy loss payments:

If actual yield is less than the yield guarantee:

• Loss payment = (yield guarantee – actual production) x price election

If actual yield is equal to or greater than the yield guarantee:

• Loss payment = 0

Comparing Crop Insurance Alternatives for Fruit Crops

To demonstrate the different levels of crop insurance protection available to a fruit producer, a fruit grower with a 900-bushel APH yield for apples and a 300-bushel APH yield for peaches in Adams County will be used as examples. The grower wants to compare the cost and protection afforded by various levels of yield protection insurance versus having no crop insurance. The examples presented here assume hypothetical indemnity prices of $12.50 per bushel for fresh-market apples (without the fresh fruit quality option) and $22.75 per bushel for fresh-market peaches. The premiums reflect the cost if the grower selected optional units.

In Table 2 you can see how yield protection insurance protects cash flow for the apple crop. In this example, CAT would pay the farmer $2,406/A for a total crop loss. Higher levels of coverage provide even more cash-flow protection for this grower. A minimum cash flow of $4,233 to $6,050/A is guaranteed in exchange for a producer-paid premium of $183 to $660/A. As the level of crop insurance protection goes up, the grower is guaranteed a less-variable cash flow. For an additional $$43-$46 per acre in premiums, this grower could also purchase additional county-based SCO protection of from $963-$3,150 per acre.

In Table 3 you can see how yield protection insurance protects cash flow for the peach crop. In this example, CAT would pay the farmer $1,877/A for a total crop loss. Higher levels of coverage provide even more cash-flow protection for this grower. A minimum cash flow of $3,323 to $4,843/A is guaranteed in exchange for a producer-paid premium of $90 to $276/A. As the level of crop insurance protection goes up, the grower is guaranteed a less-variable cash flow. For an additional $58-$94 per acre in premiums, this grower could also purchase additional county-based SCO protection of from $751-$2,457 per acre.

The only advantage of having no crop insurance is saving the premium cost (but this is lessened because crop insurance is a deductible business expense). Elimination of this cost would have a minor positive impact on your cash flow during good years and a potentially disastrous impact on your cash flow in a poor year. Choosing a crop insurance plan and level of coverage is a personal business decision. Not everyone feels the same about production risk and everyone has different financial resources. One way to choose would be to determine how much cash-flow protection you need and pick a coverage level, price election, and insurance unit combination that accomplishes your goal.

Crop Insurance Benefits for Beginning Farmers

If you are starting your own farming business, you may be eligible for additional crop insurance benefits. These include:

1. eligibility for an additional 10% premium subsidy for buy-up coverage,
2. exemption from the administrative fee for catastrophic (CAT) and buy up policies,
3. use of the production history of an existing farming operation (if you were previously involved in the decision making or physical activities of the farm), and
4. use of an 80% yield plug for replacing low APH yields (rather than the 60% yield plug available to everyone else).

These benefits are available if you and all others with a beneficial interest (10 percent or more) in the business have not actively operated or managed a farm with an insurable interest in any crop or livestock for more than 5 years. You can exclude a crop year's insurable interest if you were under age 18, enrolled in post-secondary studies, or on active duty in the U.S. military. For more information on programs to assist new and beginning farmers, visit the USDA's New Farmers website.

 How Can I Find a Crop Insurance Agent?

Although crop insurance is a federally subsidized program, it is sold by private crop insurance agents:

• Ask your neighbors for their recommendations. Other growers are one of the best sources of information on where to find a knowledgeable crop insurance agent.
• Check with the insurance agency where you purchase other types of insurance. Often you can obtain crop insurance through an agent you already use for your farm, automobile, liability, fire, health, or life insurance needs. Many insurance agencies have agents who specialize in crop insurance.
• Check with businesses or organizations you use for farm business management services. Your banker, cooperative, or a farm organization you belong to may be able to recommend insurance agencies who handle crop insurance.
• A list of crop insurance agents in your area can be found on the USDA Risk Management Agency's website.

Important Crop Insurance Dates

Deadlines for sales closing, final planting date, acreage reporting, billing, and contract changes for Pennsylvania crop insurance products are listed in Table 4.  As a crop insurance participant you should be aware of several important dates for filing information and reporting losses:

Sales Closing Date (enrollment and policy change date)—last day to apply for coverage or make changes to the policy; the sign-up deadline.

Earliest planting date – acreage planted before this date is not eligible for replanting payments.

Final planting date—last day to plant with full coverage. Late planting may be covered at reduced levels for some crops.

Acreage reporting date—last day to report the acreage as planted. If not reported, insurance may not be in effect.

Date to file notice of crop damage—within 72 hours of initial discovery of damage (but not later than 15 days after the end of the insurance period for each insurance unit). There may be additional requirements by crop. An adjuster must have the opportunity to inspect the crop before it is destroyed or put to another use.

Payment due date—last day to pay the premium without being charged interest.

Cancellation date—last day to request cancellation of policy for the next year (same date as sales closing date).

Production reporting date—last day to report production for your Actual Production History (APH).

Debt termination date—date insurance company will terminate policy for nonpayment.

Premium Billing date—date crop insurance premiums are billed. Crop insurance premiums may be deferred until 30 days after the billing date without interest charges.

End of insurance period—the date when your crop insurance coverage ends. Any notices of crop damage must be filed within 15 days of the end of the insurance period.

Farm Service Agency Risk Management Programs

The federal government has other programs administered through USDA-FSA that are designed to help farmers manage risk. However, with exception of the Noninsured Disaster Assistance Program (NAP), most are designed for agronomic crops and dairy farms. For more information or to find the location of your local FSA office go to the USDA-FSA website.

Noninsured Disaster Assistance Program (NAP). The Noninsured Crop Disaster Assistance Program (NAP) provides financial assistance to producers of crops for which multi-peril crop insurance coverage is not available. NAP is designed to help reduce financial losses when natural disasters cause major reductions in production. The basic level of NAP coverage is similar to that provided by CAT policies for insurable crops (50 percent of expected production at 55 percent of the average market price). Higher levels of protection at the 50, 55, 60, and 65 percent levels at 100 percent of the average market price are available for additional premium.

Producers eligible for the NAP program include landowners, tenants, and sharecroppers who produce eligible crops and who have less than $900,000 in adjusted gross revenue annually. Payments are limited to $125,000 for basic coverage or up to $300,000 for higher levels of coverage per crop year. To purchase NAP coverage, you pay a service fee of $325 per crop per county (with fees capped at $825 per producer per county, but not to exceed a total of $1,950 for producers growing crops in multiple counties). For higher levels of coverage, a 5.25% premium also applies (maximum premium is $15,570 based on the $300,000 maximum payment limitation). Sign up deadlines and coverage periods for NAP vary by crop; contact your local FSA office for more information. See the USDA-FSA's factsheet on NAP for details.

Tree Assistance Program (TAP). TAP was reauthorized under the 2018 Farm Bill and provides financial assistance to qualifying orchardists and nursery tree growers to replant or rehabilitate eligible trees, bushes, and vines lost by natural disasters. Plantings eligible for TAP include fruit, nut, ornamental, and Christmas trees produced for commercial sale. To qualify for TAP assistance, eligible nurserymen must have tree, bush, or vine mortality losses in excess of 15 percent for the stand (adjusted for normal mortality) from an eligible natural disaster. Mortality loss on a stand of eligible trees, bushes, or vines is based on each eligible disaster event, except for losses due to plant disease where the time period for when the stand could be infected is determined by USDA-FSA. Losses must have been unpreventable using reasonable and available management practices and must be visible and obvious to the USDA-FSA inspector. If the loss is no longer visible, USDA-FSA may accept other evidence of the loss and determine if this evidence substantiates that an eligible loss occurred. USDA-FSA may require information from a qualified expert to determine the extent of loss in the case of plant disease or insect infestation.

If USDA-FSA rules that you are eligible for compensation under TAP, you must replace the trees, bushes, or vines within12 months of the date the application is approved. For tree, bush, or vine replacement, TAP payments start when mortality exceeds 15 percent (adjusted for normal mortality) and are set at 65 percent of the actual cost of replanting or 50 percent of the actual cost of rehabilitation. An individual or entity is eligible for payment under TAP if the average Adjusted Gross Income (AGI) of the individual or entity is less than $900,000. If you believe you have suffered an eligible loss to your trees, bushes, or vines and would like to file a claim, you must submit an application and supporting documentation to USDA-FSA within 90 calendar days of each disaster event or the date when the loss became apparent to you. For more information on TAP eligibility or to file a claim, contact your local USDA-FSA office.

Additional information on TAP can be found on the USDA-FSA website.

More Information on Crop Insurance and Agricultural Risk Management

United States Department of Agriculture, Risk Management Agency

United States Department of Agriculture, Farm Service Agency

United States Department of Agriculture, New Farmers

Pennsylvania Department of Agriculture, Risk Management

National Ag Risk Education Library

Northeast Center for Risk Management Education

This article is for educational purposes only and does not cover all aspects of the risk management options described. For specific information about how crop insurance can help you manage risk on your operation, make an appointment to go over your options with a crop insurance agent.  For more information about the NAP program, contact your local USDA-FSA office.

Level of crop insurance protection¹

Notes:
¹CAT: catastrophic crop insurance (yield protection); available at no premium cost to the producer (flat application fee of $655/crop/county). Yield: higher levels of yield protection insurance ("buy-up protection") available for additional premium ($30/crop application fee).
²Premiums quoted here reflect fresh-market production without the fresh fruit quality option; your premiums may be higher or lower depending on the county where you farm and the price options you choose.  Producer premium takes into account Federal premium subsidies.

Level of crop insurance protection¹

Notes:
¹CAT: catastrophic crop insurance (yield protection); available at no premium cost to the producer (flat application fee of $655/crop/county). Yield: higher levels of yield protection insurance ("buy-up protection") available for additional premium ($30/crop application fee).
²Premiums quoted here reflect fresh-market production without the fresh fruit quality option; your premiums may be higher or lower depending on the county where you farm and the price options you choose.  Producer premium takes into account Federal premium subsidies.

Important Deadlines for Crop Insurance in Pennsylvania

¹Type of Insurance:
-- WFRP— whole-farm revenue protection insurance, with loss payments based on revenue shortfalls relative to a guaranteed percentage of your approved farm revenue.
-- APH— actual production history insurance, with loss payments based on yield shortfalls relative to a guaranteed percentage of your APH yield and an indemnity price established annually by USDA-RMA.
-- Yield—yield protection insurance, with loss payments based on yield shortfalls relative to a guaranteed percentage of your APH yield and a projected price based on Chicago Board of Trade (CBOT) data.
-- Revenue— revenue protection insurance plans (including with and without harvest price exclusion), with loss payment based on gross revenue guarantee based on your APH yield and CBOT prices.
-- Dollar— dollar plan, with loss payment based on value of your crop relative to the dollar amount of insurance
-- AYP— area yield protection insurance. Loss payments are based on relative county yield level and your selected yield trigger.
-- RI— loss payments are based on a rainfall index based on NOAA data. You choose the coverage level, protection factor trigger, and when the insurance protection is in force.
-- LGM— livestock gross margin, loss payment based on difference between your expected gross margin and actual gross margin.
-- LRP— livestock risk protection, loss payment based on difference between your actual price and coverage price.

²Final planting date varies throughout the state. Some crops also have initial planting dates which indicates the earliest a crop may be planted and still remain eligible for replanting coverage, if such coverage is available for the crop.

³March 15 for calendar year or early fiscal year tax filers, November 20 for late fiscal year tax filers.

⁴July 1 of the following season.

⁵April 30 for cigar-filler tobacco and May 15 for Maryland-type tobacco.

Crop insurance availability in Pennsylvania by county