What is Crop Insurance?

Because ‘crop growing’ isn’t usually classified as a property that is covered under most types of commercial property or farm insurance, most farmers and growers will need to buy crop insurance separately to protect their growing plants.

What types of crop insurance can you buy?

Generally speaking, there are three types of crop insurance you can buy. The first is multi-peril crop insurance, the second is crop-hail insurance, and the third is crop revenue insurance coverage. Here is a quick breakdown of the differences, and an explanation of the coverage you can expect from each.

Buying Multiple Peril Crop Insurance

This is usually offered via a program that has backing from the federal government. There are approximately 15 insurance companies who are currently approved to participate in the federal program, and their policies are distributed via a range of independent commercial insurance agent.

What crops are covered with multi-peril crop insurance?

Soybeans, Wheat, Cotton, and Corn are most commonly insured under the federal program. However, there are other less-common crops that could also be classed as insurable in core growth areas. These include pumpkins, dry peas, blueberries, walnuts, and citrus.

If you buy crop insurance, then you need to be aware that not every type of crop is covered. The crops that are included are determined by the Risk Management Agency on a county-by-county basis, and decisions are taken annually based on the risk of losses and the demand for crop insurance coverage.

What events are covered by multi-peril crop insurance?

If you buy a multi-peril crop insurance policy, then the loss of crop yields due to a freeze, drought, floods, disease, and other forms of destructive weather and natural causes are included.

Please be aware that if you want to buy crop insurance, then you must do this before you plant any crops.

Buying Crop Hail Insurance

This type of crop insurance is not government-supported and can be bought via a commercial insurance company. You may buy crop hail insurance at any time during a growing season. Contrary to popular belief, this policy does cover other perils aside from hail, including wind, lightning, fire, malicious mischief, and vandalism.

What does this type of crop insurance cover?

Coverage is usually available on a number of levels, and some crop insurance companies will also cover the crops that are not coverable under the federal program. For crop losses that may fall under the required level for federal coverage to apply, crop-hail insurance is a welcome buffer; in some cases, it can even cover the replanting costs.

Do you need to buy crop hail insurance?

There are lots of farmers who buy this type of crop insurance because hail has the distinct ability to completely destroy a major part of a planted field while leaving the rest completely unharmed. In an area where hail is frequent, this added insurance can protect high-yielding crops, and unlike multiperil crop insurance, you can buy crop hail insurance at any point in a growing season.

Buying Crop Revenue Insurance

If you want the best insurance for your crop farming, then you might also want to consider buying crop revenue coverage. This can help a farming business in those years where crops see a low yield or the prices being paid for the crops are low.

This type of crop insurance can help to give farmers a security blanket in terms of any earnings as it serves to protect against any major swings in the prices of crops, irrespective of the cause of the lower earnings.

Buying the Best Crop Insurance

There are many different levels of coverage offered to farmers and growers for crop insurance. As you can see, there are also different options as to the best types of policy you can buy. Talking to an expert crop insurance agent or company can help you quickly and easily navigate these options, and it can also result in you getting a quick quotation that covers your farm's individual crop insurance needs.