USDA-RMA Administrator’s Message: A Question of Quality
WASHINGTON, July 9, 2020 – Our team at the Risk Management Agency is a dynamic one, full of energy and new ideas. We continually seek to improve Federal crop insurance policies by providing more options for America’s farmers. As I have travelled around the country, I have listened carefully to producers, stakeholders, and our regional offices, so we can adjust and improve on policies to better serve our customers while also ensuring actuarial soundness.
I’m proud to announce that this week we are rolling out changes to several crop insurance policies, including a new unit structure assignment option for Enterprise Units (EU), new procedures for Multi-County Enterprise Units (MCEU), and something else that I would like to highlight, which I think many farmers will welcome – Quality Loss Option.
The Quality Loss Option, known as QL, is a new crop insurance option available for the 2021 crop year. The Risk Management Agency implemented this option in response to the 2018 Farm Bill to establish an alternative method for adjusting quality losses that will not impact a farmer’s Actual Production History (APH). We’ve also ensured that this option will be offered at an actuarially sound premium rate.
Selecting QL may be a smart choice, but there are a few factors to keep in mind:
- Like yield exclusion, the QL must be elected in advance by the sales closing date.
- QL is an available option under Yield Protection, Revenue Protection, Revenue Protection with Harvest Price Exclusion, and APH plans of insurance.
- QL is only available for certain commodities: corn, grain sorghum, soybeans, wheat, barley, buckwheat, canola, cotton, flax, malting barley, oats, rice, rye, safflower, and sunflower.
- When elected, it will replace post-quality production with the pre-quality production for any year a farmer filed a Notice of Loss (NOL). Quality adjustment to production will be based on the applicable quality statements contained in the Special Provisions for the crop.
- The QL may apply if you filed a NOL, regardless of whether you received an indemnity for that crop year. You are eligible to replace the post-quality production in your APH database with pre-quality production.
If you are considering the QL for your 2021 policy, I encourage you to read more on our website, www.rma.usda.gov, to understand how it works. If you decide to explore QL further, speak with an Approved Insurance Provider. A list of agents is available on the RMA Agent Locator tool.
Martin Barbre is the Administrator for USDA’s Risk Management Agency. He has served as President of the National Corn Growers Association, a member of USDA’s Illinois Farm Service Agency State Committee, and is a long-time farmer from Carmi, Illinois.