1 risk management agency risk management services division monday, january 20, 2003
TRANSCRIPT
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Risk Management AgencyRisk Management Services Division
Monday, January 20, 2003
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What’s New At RMA
RMA VISION
We serve America’s agricultural producers through effective, market-based risk
management solutions.
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What’s New At RMA
RMA MISSION
Promote, support, and regulate sound risk management solutions to strengthen and
preserve the economic stability of America’s agricultural producers.
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What’s New At RMA
STRATEGIC GOALS
• Widely available and effective risk management solutions
• A fair and effective delivery system
• Informed stakeholders
• Program integrity
• Excellent service
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What’s New At RMARMA Values
• Integrity• Professionalism• Quality• Service• Adaptability
• Diversity• Respect• Stewardship• Teamwork• Communication
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What’s New at RMA• $3.1 B + Paid in 2002 Indemnities (as of 1/12/03)• $18.5 M Awarded in Partnership Grants (12/2002)• Prevented Planting Forum• Crop Insurance Handbook (Procedural) Issues
Workshop• New Program Development• Failure of American Growers Insurance Company
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2002 Indemnities
National - $3,147,409,209 Paid on 215,732,212 Acres
Minnesota - $109,178,691 Paid on 16,276,724 Acres
North Dakota - $315,171,096 Paid on 19,562,724 Acres
South Dakota - $320,911,467 Paid on 12,394,168 Acres
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Partnership Grants
• Authorized by ARPA• Announced in December 2002• Complete list on RMA Website:
http://www.rma.usda.gov/news/2002/11/educationtable.html
• Some organizations: Montana State University, Montana Grain Growers Assn. ND Grain Growers Assn., MN Assn. Of Wheat Growers
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Prevented Planting Forum
Recent droughts have identified weaknesses in current prevented planting coverage
RMA will be evaluating its current prevented planting rules
Crop insurance industry and commodity groups will participate
First meeting held January 14, 2003
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Prevented Planting Insurance
Must provide meaningful coverage to insured’s
Must provide certainty for both companies and insured’s
Must be simple to administer Must be actuarially sound
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Prevented Planting Insurance
• Same policy provisions in effect for 2003
• New Basic Provisions Expected for 2004
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• Held January 16-17
• Industry & RMA Participants
Discuss for 2004:
All County application/election
Combining & Dividing APH Yield History
Added Land Deadlines for Underwriting Review
RMA Yield Determinations
Maximum Yield Edits
CIH Procedural Issues Workgroup
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ARPA Created New Era for Risk Management Programs
508(h) Products $65 Million over a 5 year period
Contracted Product $110 Million over a 5 year period
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508(h) Products Submission Regulation 7 CFR 400 Subpart V
Products submitted first 5 business days of Jan., April, July, or Oct.
120 days for Board to Approve or Disapprove
Once approved it is released for all SRA holders use
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Types of 508(h) Products
Crop Revenue Coverage (CRC) Revenue Assurance (RA) Group Risk Income Protection (GRIP) Livestock Gross Margin (LGM)
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Types of 508(h) Products
Livestock Risk Protection (LRP) – 2002 Hybrid Seed Price Endorsement (IL, IN, IA,
MI, MN, NE, SD and WI) – 2002 Best Management Practices (IA, MN, PA
and WI) - 2003
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The Board may Approve a Submissionif it Determines
Interests of producers are protected Rates are actuarially appropriate Submission conforms to sound insurance
and underwriting principles Associated risks are appropriate
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Failure of American Growers Insurance Company
• NE Dept. of Insurance & RMA Working Together
• Commitment to Pay Producers On Time
• Agent’s Commissions Are Being Paid
• MGR-02-022 Issued Regarding the Transfer of Policies
• Watch RMA Website for Updates
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2003 Quality Adjustment
MGR-02-020 – Clarification of Quality Adjustment Loss Provisions:
Reinsured companies must reject any quality determinations that are not based on grading standards in the respective Crop Provisions.
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2003 FM & Dockage
MGR-02-017 – Claims Advisory – Dockage
Issued August 20, 2002
Dockage & FM MAY be deducted if damage is result of insured peril.
Not intended to include elevator charges.
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Adjusted Gross Revenue
Pilot Program
Uses Producer’s Schedule F
AGR-Lite Developed by PA Dept. of Ag.
Farm Bill of 2002 Required Expansion into 8 Additional Counties in CA & PA
AND WE DID!
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Thank You
For further information, please visit the Risk Management Agency web site:
www.rma.usda.gov