On November 26, 2019, published a Product Management Bulletin: PM-19-0067 and a copy of the Sweet Potato Crop Provisions with changes effective for the 2020 crop year. RMA stated that the changes applicable for the 2020 crop year were the allowance of optional units, removal of the 4-year production requirement for insurance, an increase in the allowable acreage expansion from 110 percent to 115 percent of historical acreage, and revision to the loss adjustment procedures for irregularly-shaped fields. RMA stated that the Federal Crop Insurance Corporation Board of Directors approved the changes under section 508(h) of the Federal Crop Insurance Act on September 20, 2019.
ANALYSIS – RMA only listed the changes in the bulletin so it is unclear the basis for the changes. Most of the changes are self explanatory. Previously the policy only allowed basic and enterprise units but now optional units are allowed. Smaller units can effect the risk and indemnities paid but are allowed on most policies.
Previously producers were required to have a least four years of actual yields to qualify for an approved yield. The policy has been changed to only require four years of yields, which can now include transitional yields (T-yields), to qualify for an approved yield. The four year of actual yields requirement was to ensure that only persons experiences in producing sweet potatoes would be eligible. Now there is no minimum number of actual yields so presumably producers with no history can now obtain insurance.
The Sweet Potato policy has a maximum allowable acreage that could be insured and if the producer exceeded that maximum acreage, the guarantee would be adjusted in accordance with section 3(f) of the Sweet Potato policy. The previous maximum was 110 percent of the greatest number of insurable acres of such sweet potatoes produced in the county in the three previous crop years. For 2020, the maximum has been increased to 115 percent. This change simply allows for an additional amount of growth in the producer’s sweet potato operation.
All statements made are opinions of the author and are not intended to provide legal opinions or legal advice.