Whole Farm Revenue Protection (WFRP) is a product that does not insure an individual crop, but instead insures the income from all crops or livestock produced. This product benefits diversified crop and livestock farms by providing income protection for everything produced at a very low cost. WFRP covers losses from natural causes, like crop insurance products, as well as unexpected declining market prices within the production year. You may still insure individual crops under traditional crop insurance programs and use WFRP to provide a blanket protection (much like your farm owner's policy). You may also do the same with NAP from FSA. This program works well for producers of vegetable crops where crop insurance products are not available. It also provides good coverage for livestock producers, since the income from the sale of the livestock and crops may be insured up to 85% of the historical revenue. The product provides protection up to an $8.5 million liability limit with a premium subsidy from 50% to 80% when at least two crops are produced. Additional premium discount is provided for increased diversification which is stair stepped up to seven crops produced. This product also includes some incidental market readiness expenses necessary to make the crop ready for sale such as washing, trimming, and packaging.
Other insurance features/limitations include:
- Replant coverage for a crop loss early enough for replanting
- Eligibility is denied if expected revenue from animal products is greater than $1 million; the same limitation applies to nursery commodities.
You will need five years of Internal Revenue Service (IRS) 1040, Schedule F, documents (for the previous five years) to be eligible to apply for WFRP since coverage is based on the revenues filed over that five-year period.
The sales closing date for WFRP is March 15th, but it is not good to wait until that date to apply. The discussion with your crop insurance sales person and verification of documents for this product may take several days to complete. If you are a tree fruit grower considering this product, a discussion with your crop insurance sales person should take place before November 20th (sales closing date for individual fruit crop policies) to better protect your crop and income. For corporate business structures such as C or S Corporations, your sales person can transfer the necessary information from these tax documents into the required documents for WFRP.
Checklist for Whole Farm Revenue Protection Discussions
Be prepared to provide your crop insurance salesperson with:
- The WFRP application
- Whole Farm History Report (last 5 tax years)
- IRS Tax Form 1040 Schedule F
- Farm Operation Report (Intended, Revised, Final)
- Allowable Expenses Worksheet
- Allowable Revenue Worksheet
- Beginning and end of year Inventory Reports (if applicable)
- Accounts Receivable and Payable Reports for beginning and end of year (if applicable)
- Market Animal and Nursery Inventory/Accounting Worksheet (if applicable)
- Verifiable complete marketing record for each commodity
- You may find a certified crop insurance sales person at the USDA Risk Management Agency website.
Prepared by Lynn F. Kime, extension associate; Winifred W. McGee, extension educator; Robert Faubel, independent insurance agent, Danner' s Insurance; Maggie Garcia-Taylor, insurance agent, Garcia-Taylor Insurance Agency; and Eugene E. Gantz, U. S. Department of Agriculture, Risk Management Agency.
This document is based on work supported by USDA, Risk Management Agency, 2014 Risk Management Education Partnerships Program, Agreement Number 14-IE-53102-036.