NSAC's Blog

USDA Rolls Out New Whole-Farm Revenue Protection Insurance Policy

November 6, 2014

On Thursday, November 6, the U.S. Department of Agriculture’s Risk Management Agency (RMA) announced the release of the new Whole-Farm Revenue Protection (WFRP) insurance policy.  This new policy is intended to improve on, expand, and replace the existing Adjusted Gross Revenue (AGR) and AGR-lite policies that have been underutilized.  NSAC also issued a release upon USDA’s announcement.

Basics of the New WFRP Policy

The new policy includes major improvements over AGR an AGR-Lite, including 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.

The new WFRP policy is available for purchase for the 2015 insurance year but farmers will not be able to sign on the dotted line to purchase a policy until the policy’s handbook is released later in November.

Farmers interested in the policy should start by reviewing RMA’s fact sheet on the new WFRP policy 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 has  also released a cost estimator to help farmers decide if WFRP is right for them.

Farmers will have until February 28 or March 15 to sign up for WFRP, depending on the spring closing date for their county.  Since this is an RMA developed product all crop insurance agents are required to offer the policy.

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

Notable Changes and Benefits of WFRP:

Some of the most notable improvements this new crop insurance policy will offer include:

  • An $8.5 million limit on insured revenue (an increase from $6.5 million under AGR and $1 million under AGR-Lite);
  • 50-85 percent of historical revenue coverage level options with the 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);
  • a 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);
  • a premium discount for increased diversification stair stepped up to 7 crops;
  • coverage for livestock and nursery and greenhouse plants (capped at 35 percent of 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
  • the continued option to insure individual crops under separate crop policies (cannot be CAT level coverage).

The improvements made by this new policy include many that NSAC has advocated over the past several years.

Where WFRP is Available

WFRP is available in every state where AGR and AGR-Lite were previously available, plus eight additional states and several additional counties.  RMA has developed a map indicating in which states WFRP is now available.

These states include: AK, AL, AZ, CO, CA, CT, DE, FL, GA, HI, ID, IL, KS, ME, MD, MA, MN, MI, MT, NC, NH, NV, NM, NJ, NY, OR, PA, RI, SC, TN, UT, VI, VT, WA, WV, WI and WY.

The policy will also be available in eight additional states, IN, IA, KY, MO, NE, ND, OH, SD and new counties in CA, MI, NY, and PA.

The only places where WFRP will not be available for 2015 are Arkansas, Texas, Oklahoma, Mississippi, Louisiana, and portions of California.

Paperwork Requirements

The policy is still, necessarily, data intensive so it will be important for farmers purchasing the policy to keep good records.

It is important to remember, however, that while there will be significant paperwork burden, WFRP will have a premium subsidy of up to 80 percent, which is significantly higher than under AGR and AGR-Lite.

The paperwork responsibilities for the farmer, will include:

  • The WFRP Application
  • Whole-Farm History Report (last 5 tax years)
  • Information showing expansion of revenue of at least 10 percent if farmer wants to be covered as an expanding operations
  • IRS Tax Form 1040 Schedule F
  • Farm Operation Report (Intended, Revised, Final)
  • Allowable Expenses Worksheet
  • Allowable Revenue Worksheet
  • Beginning Inventory Report (if applicable)
  • Accounts Receivable and Payable Report (if applicable)
  • Market Animal and Nursery Inventory/Accounting Worksheet (if applicable)

Learn more about NSAC’s work on WFRP


Categories: Commodity, Crop Insurance & Credit Programs, Farm Bill, General Interest

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