Agricultural insurance (crop and livestock)

What agricultural insurance covers

Agricultural insurance protects farmers and ranchers against the weather, disease and market swings that can wipe out a season's income. In the US it has two parts. Federal crop insurance covers yield and revenue for crops, forage and livestock. It is supervised by the USDA Risk Management Agency (RMA) and the Federal Crop Insurance Corporation and sold by private Approved Insurance Providers through licensed crop insurance agents. Private farm insurance covers crop-hail, buildings, machinery, livestock mortality and farm liability. The federal program is large: the USDA Economic Research Service reports about 543 million insured acres and more than $192 billion of liability in 2024, with premium subsidies of $10.4 billion. RMA offered coverage for more than 120 commodities in 2024.

Main federal crop insurance plans

• Yield Protection: pays when your production falls below a guarantee based on your actual production history (APH).
• Revenue Protection: pays when revenue falls short because of low yields, lower prices or both; the guarantee can rise if the harvest price exceeds the projected price.
• Area plans: pay based on county-level yield or revenue rather than your own farm's results.
• Catastrophic Risk Protection (CAT): covers yield losses greater than 50%, paid at 55% of the expected market price. The premium is fully subsidized, and the administrative fee is $655 per crop per county unless the Special Provisions say otherwise.
• Whole-Farm Revenue Protection: insures the revenue of the whole operation under one policy, useful for diversified, specialty or direct-market farms.

Above CAT, farmers choose "buy-up" coverage levels. Premium subsidy percentages are set by law and depend on the coverage level and unit structure.

Livestock, dairy and forage

RMA also backs plans for animal agriculture. Livestock and animal products accounted for almost 18% of total federal liability in 2024, according to ERS.

• Livestock Risk Protection (LRP): protects against falling prices for feeder cattle, fed cattle, swine and lambs.
• Livestock Gross Margin (LGM): protects the margin between livestock value and feed costs.
• Dairy Revenue Protection (DRP): covers unexpected declines in quarterly milk revenue.
• Pasture, Rangeland, Forage (PRF): a rainfall index plan that pays based on precipitation in your grid, not on measured forage.

Death of animals from disease, accident or disaster is covered by private livestock mortality policies.

What is not covered

Federal policies cover natural causes such as drought, excess moisture, freeze, hail, wind, insects and disease, and price declines under revenue plans. They do not pay for losses from failure to follow good farming practices, neglect, theft or failure to report acreage correctly. Missing a deadline can void coverage for that unit.

What drives the price

For federal crop insurance, RMA sets the premium. All Approved Insurance Providers must charge the same amount for the same coverage, so companies and agents compete on service, not on price. Premiums depend on the crop, county, practice (irrigated or not), your APH yield, the coverage level and the unit structure; enterprise units generally receive higher subsidy rates than basic or optional units. Private crop-hail and farm property policies are priced by each insurer.

Deadlines and claims

• Apply or change coverage by the sales closing date for each crop and county.
• Report planted acres by the acreage reporting date and certify production records.
• Give notice of damage within 72 hours of discovering it, confirmed in writing within 15 days.
• Do not destroy, replant or abandon a damaged crop until the adjuster has appraised and released it.

International perspective

Many countries run public-private agricultural insurance schemes, such as Agroseguro in Spain and Pradhan Mantri Fasal Bima Yojana in India, while index-based products help smaller producers where farm-level data is scarce. Large agricultural risks are supported by global reinsurers.

How to choose

Review your yield history, marketing plan and debt obligations with an agent before the sales closing date, and use the USDA Risk Management Agency agent locator and cost estimator. Add private cover for buildings, equipment and liability alongside commercial property. Polis Re helps you compare insurers and request quotes for private farm, crop-hail and livestock coverage through one request.