On August 27, USDA’s Risk Management Agency (RMA) announced the expansion of the Whole-Farm Revenue Protection (WFRP) crop insurance policy to every state and every county, making WFRP the first crop insurance policy to be universally available nationwide.

WFRP is a single crop insurance policy that insures all of a farmer’s crops and animals under one policy. Since most single crop policies are not widely available and many organic and other niche crops cannot be insured at their price premiums, this policy fills a major access gap in our current crop insurance system.

The announcement, which came in advance of the September 1st deadline for changes to crop insurance policies for 2016, also includes several other important changes that NSAC requested in comments submitted in April that will benefit farmers that have not previously had viable access to crop insurance.

Beginning Farmers

For 2016, beginning farmers that started farming in 2012 will now be eligible to purchase a WFRP policy, which is two years earlier than they would have under the current policy. Instead of five years of tax records, farmers will now only need three years of records in order to qualify for insurance coverage. The need for WFRP to be more accessible to beginning farmers was a major concern for NSAC and our members and was one of our top requests of RMA.

The required lag year remains in place, which is why for the 2016 crop year a farmer will have to have tax records going back to 2012 in order to qualify. The revenue from the lag year and the lowest of the four tax years will be used to calculate the average farm revenue as if there were five years of tax records available.

Farmers Selling to Direct Markets

Farmers that market their crops directly to the public will now see streamlined record keeping requirements for Whole-Farm in 2016.

The policy will allow contemporaneous price records to be used to calculate the farmer’s actual revenue during the insurance year. Previously, farmers needed third party verified records, which is extremely hard to obtain by farmers that market directly to the public through roadside stands and farmers’ markets.

Confusion about what records farmers needed in order to comply with the requirements of Whole-Farm policy was an often repeated concern of farmers and crop insurance agents in 2015, and we are excited to see this change being made. Streamlined record keeping was another top priority for NSAC in order to improve the program.

Farmers will be required to keep daily records for each kind of crop, but not individual sales receipts. This will not change the ability of farmers to use wholesale contracts and other third party verified records for other sales.

This is an important improvement that should make the policy more useful and attractive to a segment of farmers that have had little access to crop insurance in the past. These types of farmers often grow several types of crops on acreages that are often too small to insure with traditional single crop policies. In most cases there are no single crop policies even available in their state or county for many of the crops they grow.

For these farmers, Whole-Farm is their only option; this change should make it a more viable option.

RMA has posted handy record keeping aids for direct marketers on its Whole-Farm web page. These basic tools will help farmers that market directly to the public understand what records they need to keep.

Other Changes

RMA announced several other changes to its Whole-Farm policy, including:

• Eliminating the 35 percent limit on expected revenue from animals and animal products, and greenhouse and nursery crops, while retaining the overall cap of $1 million on revenue from these sources remains in place (note – diversified crop-livestock farmers cited this cap as the main reason they were not able to purchase a Whole-Farm policy and NSAC included this request in our comments in April);
• Allowing farmers who have been physically unable to farm for a year, such as because of illness or military deployment, to be able to substitute the lag year for the missing year;
• Expanding eligibility to tax-exempt organizations to qualify if they have appropriate records to substitute for tax records; and
• Increasing the ability of expanding operations to obtain increased coverage by increasing the expanding operations limit to 35 percent.

Basics of Whole-Farm Revenue Protection Insurance

WFRP, which was first offered for the 2015 crop year, replaced and modified the previously existing Whole-Farm policies AGR and AGR-Lite. Whole-Farm offers higher coverage levels, premium discounts for increased diversity, coverage for market readiness activities and expanding operations, and higher subsidy rates.

This policy, unlike traditional yield or revenue insurance, is not intended for a single specific crop, but for all the crops and livestock grown or raised on a single farm. This will especially help diversified sustainable and organic farms that do not have single crop policies or price elections available for one or more of the crops grown.

Learn more about Whole-Farm in NSAC’s Grassroots Guide to Federal Farm and Food Programs.

How Farmers Can Purchase Whole-Farm

Beginning September 1, farmers can begin signing up for WFRP and will have until January 31, February 28 or March 15, depending on the spring closing date for their county, to purchase the insurance.

Farmers interested in the policy should start by reviewing RMA’s fact sheet on WFRP and then talk to their crop insurance agent about the records they will need to assemble and what the purchase deadline is for their county. RMA also has several other resources available to help farmers decide if WFRP is right for them.

Notable Changes and Benefits Already Included in WFRP

• An $8.5 million limit on insured revenue (an increase from $6.5 million under AGR and $1 million under AGR-Lite);
• Coverage level options of 50-85 percent of historical revenue, with with the two highest levels available when at least three crops are grown (an increase from the previous 80 percent cap under AGR and AGR-Lite);
• Premium subsidy of up to 80 percent when at least two crops are grown (a significant increase over the highest subsidy rate of 59 percent provided under AGR-Lite and the 67 percent provide by Basic Unit revenue policies);
• Premium discount for increased diversification stair stepped up to 7 crops;
• Coverage for livestock and nursery and greenhouse plants (capped at revenue up to $1 million each);
• Inclusion of some incidental processing expenses necessary to make the commodity ready for market, such as washing, trimming, and packaging;
• Increased coverage for expanding operations;
• Replant coverage for a crop losses early enough for replanting; and
• Continuation of the option to insure individual crops under separate crop policies (cannot be CAT level coverage) while using Whole-Farm for everything else.

Conclusion

NSAC is very pleased with RMA’s efforts to improve Whole-Farm for 2016. We appreciate that RMA moved quickly to respond to our comments and those of agents and farmers on how the first year of Whole-Farm went. We look forward to promoting Whole-Farm for 2016, while also continuing to look for ways to improve the policy in the future.