2005 Crop Insurance Update 1/24/05

Things to think about for 2005:

• It is critical now more than ever to make sure that all APHs, planted acres, and shareholder data is accurate. (Stiff new penalties now apply in a loss situation when reported liability is greater than 10% under or over actual liability.)
• We offer all of our insureds GIS-based maps of their insured cropland to help ensure that we are both “on the same page” when it comes to your insured cropland acres, Farm Serial Numbers (FSNs) and shareholder data.

• Added land rules are simpler and better.
• Added land in existing county gets to use a simple average of existing yield data (if that is better than the county T-yield) across all basic and/or optional units!
• 640/2000 – acre rules still apply

• Market prices that determine revenue coverage spring guarantees are currently tracking 20% lower than last year’s prices on both corn and soybeans. In order to obtain your required collateral or guaranteed revenue, you may want to consider buying a higher level of coverage.
• Many APHs are higher as a result of 2004 outstanding reported yields
• With lower spring revenue prices come lower spring minimum guarantees, but also lower premiums
• Higher corn and soybean usage may mean high fall prices with a below average US crop
• Take advantage of lower premiums on revenue coverage, as premiums do not increase even if coverage increases due to higher fall prices

• Soybean Rust is a covered peril on APH-based plans (including CRC and RA) as long as good farming practices are followed

• Optional units are still a great value – can cover each section separately for only 10% surcharge

• Production Plan crop-hail coverage may be a very valuable tool in rounding out your crop coverage without becoming “insurance poor”