There are two basic forms of crop insurance that are widely available in California. The first is Multiple Peril Crop Insurance (MPCI) that is a broad-based crop insurance program administered by the USDA Risk Management Agency (RMA) and is subsidized by the Federal Crop Insurance Corporation (FCIC). The second type of insurance is Catastrophic (CAT).
Other crop insurance products are available in certain areas (not all in California), including Crop Revenue Coverage, Group Risk Plan, Adjusted Gross Revenue (AGR), and some Private Named Peril policies.
Below, we have highlighted the coverage for MPCI and CAT policies:
Provides protection against an unavoidable loss in yield due to nearly every natural disaster. For most crops, that includes drought, excessive moisture, cold and frost, wind, flood and damage from insects and disease.
Most programs guarantee a yield, based on an individual actual production history (APH).
If the production to count (harvest) is less than the yield guarantee, the insured will be paid a loss.
MPCI does NOT cover losses resulting from not following good farming practices, low commodity prices, theft and specified perils that are excluded in some policies.
MPCI coverage levels available are 50%, 55%, 60%, 65%, 70%, and 75% as a percentage of your total crop size. All levels are covered at 100% of the MPCI price, which is set by the government each year.
CAT insurance is the minimum level of multiple peril crop insurance coverage at 50% of the producers’ yield and 55% of the price.
The premium is 100% subsidized. The farmer pays a $100 per crop or grape variety per county administrative fee.
CAT insurance provides protection from the same type of losses that are covered with MPCI insurance.