A new crop insurance product is available for 2017. It’s called Production Cost Insurance and it gives farmers an alternative to multi-peril crop insurance. The product was developed in Canada seven years ago and is now cleared in 30 states for the upcoming growing season. Lee Friesen is national account manager with Global Ag Risk Solutions and works out of Olivet, South Dakota. He says PCI looks back at uses a producers own five year historical grain revenue to create a revenue floor, which makes it an attractive product in this low grain price environment.
He says the product looks at the farmer’s gross margin, fixed and variable costs like inputs and it insures those amounts. So Friesen says there in an incentive for farmers to max out their inputs and increase their productivity because these costs are all covered.
He says farmers must sign up and get protection in place before planting. For more information on Production Cost Insurance go to the Global Ag Risk Solutions website.
