Crop Insurance Today Fourth Quarter 2019 - 6

Corn Wind/Green Snap/
Extra Harvest Expense
Filings

FALCs for policies that include Corn Wind,
Green Snap, and Extra Harvest Expense coverages have significantly increased in recent years
since the initial NCIS filings.
When NCIS initially filed Corn Wind and
Green Snap coverages, FALCs were expressed as
factors relative to township Hail FALCs in Kansas, Nebraska, North Dakota and South Dakota;
varied by coastal and inland counties in Georgia;
and statewide in all other states. This simplified
rating approach was utilized due to limited wind
experience up to that point in time.
The 2020 filings included several changes. The
new FALCs incorporated experience from 2008
through 2018. Rating areas were revised to the
Crop Reporting District (CRD) in all states. The
same relativity factors comparing Corn Wind,
Green Snap, and Extra Harvest Expense were
filed in all states. Coverage dates were expanded by 30 days in all states and Corn Wind and
Green Snap loss costs and forms were introduced
in Louisiana, Michigan, and Mississippi for 2020.
Previously, most companies offered a version of the Extra Harvest Expense coverage, so
it made sense for NCIS to file the coverage as an
endorsement to Corn Wind. The loss costs and
form were added in all 17 states for 2020.
New Production Plan Corn Wind and Green

FOURTHQUARTER2019

Table 2

State

Combined Hail
FALC Change

Base Crops

Arizona
+3.3% Cotton

Iowa
-0.2%
Corn, Soybean

Kansas
+1.5%
Wheat, Corn

Kentucky
+1.4% Tobacco

Minnesota
+0.5%
Corn, Wheat, Soybean

Nebraska
-1.1%
Corn/Wheat, Soybean

New Mexico
+1.4%
Cotton, Wheat, Chile Peppers

North Dakota
+0.04%
Wheat, Soybean

Oklahoma
+0.9%
Wheat, Cotton

South Dakota
+2.7%
Wheat, Corn, Soybean

Tennessee
+3.0%
Burley, Tobacco, Dark Tobacco, Cotton

Texas
+4.4%
Cotton, Wheat, Corn, Milo

Snap form and factors were added in Iowa, Kansas, Minnesota, Nebraska, North Dakota, and
South Dakota.
All states except Georgia and North Dakota
approved the Corn Wind, Green Snap and Extra
Harvest Expense loss costs as initially filed by
NCIS. Georgia and North Dakota loss costs will
be transitioned over a three-year time frame.

Hemp Seed and Hemp Fiber

NCIS is filing Hemp grown for seed and
Hemp grown for fiber endorsements and rating
factors or loss costs in all 48 states for 2020. The
Hemp Seed endorsement includes a mandatory
XS20 payout provision and the Hemp Fiber en-

dorsement includes a mandatory XS10 payout
provision.

State Bulletins

State Insurance Departments from Iowa,
Minnesota, Nebraska, and North Dakota require
insurance companies to comply with Crop-Hail
bulletins specific to the respective state. NCIS
collaborates not only with the states but with
companies on development of the bulletins.
Crop-Hail bulletins include allowable deviation
criteria/actuarial requirements, expense data requirements, filing deadlines, cash discount dates,
and other information.
In conclusion, while most people think of the
larger volume, federal program when considering crop insurance, the state-regulated Crop-Hail
program makes a significant contribution to the
safety net for America's farmers. The $1 billion
premium program covering $35 billion of liability provides flexibility to farmers, allowing them
to buy additional coverage throughout the year,
without as many stringent deadlines as the federal program. There are also many optional coverages and policies available and some companies
can even tailor their specific named-peril products directly to the needs of the farmer.
NCIS is proud of the extensive crop-hail database it maintains, which dates back to 1948.
These 70 years of data provide a greater level
accuracy and credibility at a more granular level during the FALC determination process. The
goal of NCIS' actuarial team is to develop FALCs
which are "actuarially fair," that is they are neither
inadequate, excessive, nor unfairly discriminatory. The resulting FALCs are filed with the states
and ensure farmers pay a fair price for this valuable coverage.

Crop Insurance Today Fourth Quarter 2019

Table of Contents for the Digital Edition of Crop Insurance Today Fourth Quarter 2019