[Federal Register Volume 61, Number 196 (Tuesday, October 8, 1996)]
[Proposed Rules]
[Pages 52717-52727]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-25640]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 61, No. 196 / Tuesday, October 8, 1996 / 
Proposed Rules  

[[Page 52717]]



DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 407

RIN 0563-AB06


Group Risk Plan of Insurance

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Proposed rule.

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SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes to add 
regulations to provide for the operation of an alternative risk 
management tool to be known as the Group Risk Plan of Insurance (GRP). 
This plan will insure against the widespread loss of production of 
certain crops in a county. It is intended primarily for use by those 
producers whose yields tend to follow the county average yield. GRP 
pays only when the average yield of the entire county drops below the 
expected county yield for the insured crop as set by the FCIC. Payment 
is based on the percentage of decline in a county or area wide yield 
below the insured's trigger yield. The insured need not have a loss to 
collect an indemnity. Alternately, the insured may have a loss and not 
collect an indemnity.

DATES: Written comments, data, and opinions on this proposed rule will 
be accepted until close of business November 22, 1996, and will be 
considered when the rule is to be made final. The comment period for 
information collections under the Paperwork Reduction Act of 1995 
continues through December 6, 1996.

ADDRESSES: Interested persons are invited to submit written comments to 
the Chief, Product Development Branch, Federal Crop Insurance 
Corporation, United States Department of Agriculture, 9435 Holmes Road, 
Kansas City, Mo 64131. Written comments will be available for public 
inspection and copying in room 0324, South Building, USDA, 14th and 
Independence Avenue, S.W., Washington D.C., 8:15 am to 4:45 pm, EST, 
Monday through Friday, except holidays.

FOR FURTHER INFORMATION CONTACT: William Klein, Program Analyst, 
Research and Development Division, Product Development Branch, FCIC, at 
the Kansas City, MO address listed above. Telephone (816) 926-7730. For 
a copy of the Cost-Benefit Analysis to the GRP, contact David 
Winningham, Advisory and Corporate Operations Staff, Regulatory Review 
Group, Farm Service Agency, P.O. Box 2415, AG Box 0570, United States 
Department of Agriculture, Washington, D.C. 20250, telephone (202) 720-
5457.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This rule has been determined to be significant for the purposes of 
Executive Order 12866 and, therefore, has been reviewed by the Office 
of Management and Budget (OMB). The sunset review date established for 
these regulations is January 1, 2001.

Cost Benefit Analysis

    A Cost Benefit Analysis has been completed and is available to 
interested persons at the address listed above. In summary, the 
analysis finds that the expected benefits associated with this proposed 
regulation outweigh the costs. Producers have a risk management program 
available in GRP, which offers lower deductibles and in many cases, 
requires lower premiums. GRP provides benefits to the Government, 
taxpayers, and producers because it costs less to administer. Program 
costs are dependent on the total premium (premium per acre multiplied 
by the number of acres), and the premium per acre for GRP is lower than 
it is for APH-MPCI. In addition, under the GRP plan expense 
reimbursement to private companies is lower than under APH-MPCI because 
GRP does not require individual yield histories or individual loss 
adjustments. For the 1997 crop year the expense reimbursement is 27 
percent of the total premium for GRP and 29 percent for APH-MPCI.
    These regulations eliminate preliminary payments, a feature of the 
pilot program, which will further reduce FCIC's administrative costs 
and the additional costs incurred when NASS is required to provide 
early yield estimates. GRP Basic and Crop Provisions do not contain 
APH, prevented planting, or loss adjustment requirements. A loss 
situation is triggered only when the NASS county yield for the crop 
year is less than the expected county average yield, regardless of 
whether or not the individual producer experiences a loss of 
production. Because adverse selection and moral hazard are not 
significant problems with GRP, FCIC losses will likely be minimal over 
the long run.

Paperwork Reduction Act of 1995

    A Paperwork Reduction Package has been prepared to add the GRP 
Provisions to the Catastrophic Risk Plan (CAT) and Related 
Requirements. The CAT regulations were previously approved by OMB 
pursuant to the predecessor of the Paperwork Reduction Act of 1995 (44 
U.S.C., chapter 35) under OMB control number 0563-0003 through 
September 30, 1998.
    The information to be collected includes: a crop insurance acreage 
report, an insurance application and continuous contract. Information 
collected from the acreage report and application is electronically 
submitted to FCIC by the reinsured companies. Potential respondents to 
this information collection are producers of GRP crops that are 
eligible for Federal crop insurance.
    The information requested is necessary for the insurance company 
and FCIC to provide insurance and reinsurance, determine eligibility, 
determine the correct parties to the agreement or contract, determine 
and collect premiums or other monetary amounts, and pay benefits.
    All information is reported annually. For this rule, the reporting 
burden for collection of information is estimated to average 16.9 
minutes per response for each of the 2.0 responses from approximately 
15,637 respondents. The total annual burden on the public for this 
information collection is 25,760 hours.
    The comment period for information collections under the Paperwork 
Reduction Act of 1995 continues on the following: (a) whether the 
proposed collection of information is necessary for the proper 
performance of the functions of the agency, including whether the 
information shall have practical utility; (b) the accuracy of the 
agency's estimate of the burden of the proposed collection of 
information; (c)

[[Page 52718]]

ways to enhance the quality, utility, and clarity of the information to 
be collected; and (d) ways to minimize the burden of the collection of 
information on respondents, including through the use of automated 
collection techniques or other forms of information gathering 
technology.
    Comments should be submitted to the Desk Officer for Agriculture, 
Office of Information and Regulatory Affairs, Office of Management and 
Budget, Washington, D.C. 20503 and to Bonnie Hart, USDA, FSA, Advisory 
and Corporate Operations Staff, Regulatory Review Group, P.O. Box 2415, 
Ag Box 0572, Washington, D.C. 20013-2415, telephone (202) 690-2857. 
Copies of the information collection may be obtained from Bonnie Hart 
at the above address.
    The Office of Management and Budget (OMB) is required to make a 
decision concerning the collection(s) of information contained in these 
proposed regulations between 30 and 60 days after submission to OMB. 
Therefore, a comment to OMB is best assured of having its full effect 
if OMB receives it within 30 days of publication. This does not affect 
the deadline for the public to comment on the proposed regulation.

Unfunded Mandate Reform Act of 1995

    Title II of the Unfunded Mandate Reform Act of 1995, (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector.
    This rule contains no Federal mandates (under the regulatory 
provisions of Title II of the UMRA) for State, local, and tribal 
governments or the private sector. Thus, this rule is not subject to 
the requirements of sections 202 and 205 of the UMRA.

Executive Order 12612

    It has been determined under section 6(a) of Executive Order 12612, 
Federalism, that this rule does not have sufficient Federalism 
implications to warrant the preparation of a Federalism Assessment. The 
provisions contained in this rule will not have a substantial direct 
effect on States or their political subdivisions, or on the 
distribution of power and responsibilities among the various levels of 
Government.

Regulatory Flexibility Act

    This regulation will not have a significant impact on a substantial 
number of small entities. The provisions in this rule will not impact 
small entities to a greater extent than large entities. The amount of 
work required of the insurance companies and the FSA offices delivering 
these policies and the procedures therein will not increase from the 
amount of work currently required to deliver previous policies to which 
this regulation applies. In fact, this action reduces the paperwork 
burden on the producer and the reinsured company because the yield is 
based on National Agricultural Statistics Service (NASS) yields rather 
than individual producer's yields. Therefore, this action is determined 
to be exempt from the provisions of the Regulatory Flexibility Act (5 
U.S.C. 605) and no Regulatory Flexibility Analysis was prepared.

Federal Assistance Program

    This program is listed in the Catalog of Federal Domestic 
Assistance under No. 10.450.

Executive Order 12372

    This program is not subject to the provisions of Executive Order 
12372 which require intergovernmental consultation with State and local 
officials. See the Notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115, June 24, 1983.

Executive Order 12778

    The Office of the General Counsel has determined that these 
regulations meet the applicable standards provided in sections (2)(a) 
and 2(b)(2) of Executive Order No. 12778. The provisions of this rule 
will not have a retroactive effect prior to the effective date. The 
provisions of this rule will preempt State and local laws to the extent 
such State and local laws are inconsistent herewith. The administrative 
appeal provisions in 7 CFR parts 11 and 780 must be exhausted before 
action for judicial review may be brought against FCIC.

Environmental Evaluation

    This action is not expected to have a significant impact on the 
quality of the human environment, health, and safety. Therefore, 
neither an Environmental Assessment nor an Environmental Impact 
Statement is needed.

Background

    The GRP program was established as a pilot program to test the 
market acceptance of a crop insurance product that establishes coverage 
using NASS county average yields rather than individual yields. It was 
designed to provide greater coverage for the insured's premium dollar. 
This product is less costly to administer than traditional crop 
insurance, and as a result, it helped to solve the problem of a costly 
administrative burden to the government. The Omnibus Budget 
Reconciliation Act of 1993 (Public Law 103-66) and the Federal Crop 
Insurance Reform Act of 1994 (Public Law 103-354) amended the Federal 
Crop Insurance Act to authorize full implementation of the program.
    The Agricultural Market Transition Act (AMTA) of 1995 set in motion 
the phase out of traditional agricultural programs by the year 2002. 
GRP is an alternative risk management product designed to provide a 
safety net for agricultural producers. During the pilot phase, we 
determined that the preliminary payment concept did not provide a 
significant benefit to a large number of insureds and was costly to 
administer. Consequently we have eliminated preliminary payments in the 
draft proposed rule. In addition, we determined that the GRP forage 
policy was deficient in that it did not provided coverage for producers 
whose forage was harvested through ``rotational grazing''. Our 
evaluation revealed that adding the practice of rotational grazing was 
an appropriate risk, and we included it as an insurable practice.
    FCIC welcomes comments from the public, particularly from producers 
and the industry who are affected by GRP provisions on a daily basis. 
Ideas which were brought to our attention during the GRP pilot program, 
such as adding rotational grazing to the GRP Forage Crop Provisions, 
have contributed toward making GRP a better and more user friendly 
product.
    FCIC hereby proposes regulations for a risk management product to 
be known as the Group Risk Plan. The Group Risk Plan Common Policy 
Basic Provisions and Crop Provisions for Barley, Corn, Cotton, Forage, 
Grain Sorghum, Peanuts, Soybeans and Wheat are proposed to be effective 
beginning with the 1998 and succeeding crop years. Group Risk Plan is a 
plan of insurance that indemnifies an insured whenever the NASS county 
yield for the crop year is less than the expected county average yield 
by more than a specified amount. Group Risk Plan provides protection 
against loss of crop production that affects a high percentage of the 
planted acreage in a county. It was developed for producers whose 
average yield from all the fields they farm in a county tends to 
increase or decrease in the same manner as the NASS county average 
yield. If the relationship of the yields is perfect, both the NASS 
county yield and the producer's yields would rise and fall by the same 
percentage each year. This is an insurance product for producers who 
want protection against catastrophic losses with minimal record

[[Page 52719]]

requirements to establish insurance protection.

List of Subjects in 7 CFR Part 407

    Crop insurance, Group Risk Plan, Barley, Corn, Cotton, Forage, 
Grain sorghum, Peanut, Soybean, Wheat.

Proposed Rule

    For the reasons set out in the preamble, the Federal Crop Insurance 
Corporation proposes to add a new part 407 to chapter IV of title 7 of 
the Code of Federal Regulations, effective for the 1998 and succeeding 
crop years, to read as follows.

PART 407--GROUP RISK PLAN OF INSURANCE; REGULATIONS FOR THE 1998 
AND SUCCEEDING CROP YEARS

Sec.
407.1  Applicability.
407.2  Availability of Federal crop insurance.
407.3  Premium rates, amounts of protection, and coverage levels.
407.4  OMB control numbers.
407.5  Creditors.
407.6  Good faith reliance on misrepresentation.
407.7  The contract.
407.8  The application and policy.
407.9  Group Risk Plan Common Policy.
407.10  Group risk plan for barley.
407.11  Group risk plan for corn.
407.12  Group risk plan for cotton.
407.13  Group risk plan for forage.
407.14  Group risk plan for grain sorghum.
407.15  Group risk plan for peanut.
407.16  Group risk plan for soybean.
407.17  Group risk plan for wheat.

    Authority: 7 U.S.C. 1506(1), 1506(p).


Sec. 407.1  Applicability.

    The provisions of this part are applicable only to those crops and 
crop years for which a Crop Provision is contained in this part.


Sec. 407.2  Availability of Federal Crop insurance.

    (a) Insurance shall be offered under the provisions of this part on 
the insured crop in counties within the limits prescribed by and in 
accordance with the provisions of the Federal Crop Insurance Act, as 
amended (7 U.S.C. 1501 et seq.) (the Act). The crops and counties shall 
be designated by the Manager of the Federal Crop Insurance Corporation 
(Corporation) from those approved by the Board of Directors of the 
Corporation.
    (b) The insurance may be offered through companies reinsured by the 
Corporation under the same terms and conditions as the contract 
contained in this part. These contracts are clearly identified as being 
reinsured by the Corporation. Additionally, this provision may be 
offered by means other than through reinsured companies. The contract 
contained in this part may be offered directly to producers through 
agents of the Farm Service Agency (FSA). Those contracts are 
specifically identified as being offered by the Corporation.
    (c) No person may have in force more than one insurance policy 
issued or reinsured by the Corporation on the same crop for the same 
crop year, in the same county, unless specifically approved in writing 
by the Corporation.
    (d) If a person has more than one contract under the Act 
outstanding on the same crop for the same crop year, in the same 
county, that have not been properly approved by the Corporation, all 
such contracts shall be voided for that crop year and the person will 
be liable for the premium on all contracts, unless the person can show 
to the satisfaction of the Corporation that the two policies of 
insurance were inadvertent and without the fault of the person.
    (e) If the unapproved multiple contracts of insurance are shown to 
be inadvertent, and without the fault of the insured, the contract with 
the earliest application will be valid and all other contracts on that 
crop in the county for that crop year will be canceled. No liability 
for indemnity or premium will attach to the contracts so canceled.
    (f) The person must repay all amounts received in violation of this 
section with interest at the rate contained in the contract (see 
Sec. 407.8, paragraph 21).
    (g) A person whose contract with the Corporation or with a company 
reinsured by the Corporation under the Act has been terminated because 
of violation of the terms of the contract is not eligible to obtain 
crop insurance under the Act with the Corporation or with a company 
reinsured by the Corporation unless the person can show that the 
termination was improper and should not result in subsequent 
ineligibility.
    (h) All applicants for insurance under the Act must advise the 
insurance provider, in writing, at the time of application, of any 
previous applications for insurance or policies of insurance under the 
Act and the present status of any such applications or insurance.


Sec. 407.3  Premium rates, amounts of protection, and coverage levels.

    (a) The Manager of the Corporation shall establish premium rates, 
amounts of protection, and coverage levels for the insured crop that 
will be included in the actuarial table on file in the insurance 
provider's office for the county. Premium rates, amounts of protection, 
and coverage levels may be changed from year to year.
    (b) At the time the application for insurance is made, the person 
must elect an amount of protection and a coverage level from among 
those contained in the actuarial table for the crop year.


Sec. 407.4  OMB control numbers.

    The information collection activity associated with this rule has 
been previously approved by the Office of Management and Budget (OMB) 
under control number 0563-0003.


Sec. 407.5  Creditors.

    An interest of a person in an insured crop existing by virtue of a 
lien, mortgage, garnishment, levy, execution, bankruptcy, involuntary 
transfer or other similar interest shall not entitle the holder of the 
interest to any benefit under the contract.


Sec. 407.6  Good faith reliance on misrepresentation.

    (a) Notwithstanding any other provision of the crop insurance 
contract, whenever:
    (1) A person entering into a contract of crop insurance under these 
regulations who, as a result of a misrepresentation or other erroneous 
action or advice by an agent or employee of the Corporation:
    (i) Is indebted to the Corporation for additional premiums; or
    (ii) Has suffered a loss to a crop which is not insured or for 
which the person is not entitled to an indemnity because of failure to 
comply with the terms of the insurance contract, but which the person 
believed to be insured, or believed the terms of the insurance contract 
to have been complied with or waived; and
    (2) The Board of Directors of the Corporation, or the Manager in 
cases involving not more than $100,000.00, finds that:
    (i) An agent or employee of the Corporation made such 
misrepresentation or took other erroneous action or gave erroneous 
advice;
    (ii) Said person relied thereon in good faith and acted thereon to 
the person's detriment; and
    (iii) To require the payment of the additional premiums or to deny 
such person's entitlement to the indemnity would not be fair and 
equitable, such insured shall be granted relief the same as if 
otherwise entitled thereto.
    (b) The following apply to FCIC Policy only: Requests for relief 
under this section must be submitted to the Corporation in writing. The

[[Page 52720]]

Corporation's reviewing officers must refer such application for relief 
to the Manager or Board of Directors of the Corporation for 
determination as to whether to grant relief. The Corporation's 
reviewing officers do not have authority to grant relief under this 
section.
    (c) The following apply to Reinsured Policy only: The reinsured 
companies shall use arbitration, in accordance with the rules of the 
American Arbitration Association, under contracts for insurance issued 
by them under the Act to grant relief under the same terms and 
conditions as contained in this section or may establish procedures to 
administratively handle relief in accordance with such terms and 
conditions. Granting relief under this section does not absolve the 
reinsured company from liability to the Corporation for any 
unauthorized acts of its agents.


Sec. 407.7  The contract.

    The insurance contract shall become effective upon the acceptance 
by the Corporation or the reinsured company of a duly executed 
application for insurance on a form prescribed or approved by the 
Corporation. The contract shall consist of the accepted application, 
policy, crop provisions, Special Provisions, Actuarial Table, and any 
amendments, endorsements, or options thereto. Changes made in the 
contract shall not affect its continuity from year to year. Except as 
may be allowed under Sec. 407.6, and at the sole discretion of the 
Corporation, no indemnity shall be paid unless the person complies with 
all terms and conditions of the contract. The forms required under this 
part and by the contract are available at the office of the insurance 
provider.


Sec. 407.8  The application and policy.

    (a) Application for insurance, on a form prescribed or approved by 
the Corporation, must be made by any person who wishes to participate 
in the program in order to cover such person's share in the insured 
crop as landlord, owner-operator, crop ownership interest, or tenant. 
No other person's interest in the crop may be insured under the 
application. The application must be submitted to the Corporation or 
the reinsured company through a crop insurance provider, and must be 
submitted on or before the applicable sales closing date on file in the 
insurance provider's local office.
    (b) The Corporation or the reinsured company may reject or no 
longer accept applications upon the Corporation's determination that 
the insurance risk is excessive. The Manager of the Corporation is 
authorized in any crop year to extend the sales closing date for 
submitting applications, unless prohibited by law, upon determining 
that the probability and severity of claims will not increase because 
of the extension, by placing the extended date on file in the insurance 
provider's office and publishing a notice in the Federal Register. If 
adverse conditions should develop during the extended period, the 
Corporation will require the insurance provider to immediately 
discontinue acceptance of applications.
    (c) Since this Group Risk Plan differs significantly from 
traditional multiple peril crop insurance (MPCI), persons who purchase 
the Group Risk Plan and their insurance providers will be required to 
execute a disclaimer explaining that: the final Group Risk Plan 
indemnity payment, if any, will be made after the Group Risk Plan 
premium is received; a person may have a low yield on his or her 
individual farm and still not receive a payment under Group Risk Plan; 
and a person may not have any loss of production and still collect 
under the policy if a loss of production is general in the area. By 
executing this disclaimer, the insured certifies that he or she 
understands:
    (1) The Terms of the Group Risk Plan;
    (2) A MPCI policy is available in the county; and
    (3) A separate Group Risk Plan and MPCI policy cannot be purchased 
on the same crop by the same person in the same county for the same 
crop year.


Sec. 407.9  Group Risk Plan Common Policy.

United States Department of Agriculture Group Risk Plan Common Policy

(This is a continuous policy. Refer to Provision 16.)

[FCIC Policies]

    This insurance policy establishes a risk management program 
developed by the Federal Crop Insurance Corporation (FCIC), an 
agency of the United States Government, under the authority of the 
Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et seq.) 
(Act). All terms of the policy and rights and responsibilities of 
the parties hereto are subject to the Act and all regulations under 
the Act published in chapter IV of 7 CFR, and may not be waived or 
varied in any way by the crop insurance agent, or any other agent or 
employee of FCIC or the Farm Service Agency (FSA).
    Throughout this policy, ``you'' and ``your'' refer to the person 
shown on the accepted application and ``we,'' ``us'' and ``our'' 
refer to the Federal Crop Insurance Corporation. Unless the context 
indicates otherwise, the use of the plural form of a word includes 
the singular use and the singular form of the word includes the 
plural.

[Reinsured Policies]

    This insurance policy establishes a risk management program 
created by the Federal Crop Insurance Corporation (FCIC), an agency 
of the United States Government under the authority of the Federal 
Crop Insurance Act, as amended (7 U.S.C. 1501 et seq.)
    This insurance policy is reinsured by FCIC under the provisions 
of the Federal Crop Insurance Act, as amended (7 U.S.C. 1501 et 
seq.) (Act). All terms of the policy and rights and responsibilities 
of the parties are subject to the Act and all regulations under the 
Act published in chapter IV of 7 CFR, and may not be waived or 
varied in any way by the crop insurance agent, or any other agent or 
employee of the company.
    Throughout this policy, ``you'' and ``your'' refer to the person 
shown on the accepted application and ``we,'' ``us'' and ``our'' 
refer to the reinsured company issuing this policy. Unless the 
context indicates otherwise, the use of the plural form of a word 
includes the singular use and the singular form of the word includes 
the plural.

[Both Policies]

    The Group Risk Plan of Insurance (GRP) is designed as a risk 
management tool to insure against widespread loss of production of 
the insured crop in a county. It is primarily intended for use by 
those producers whose farm yields tend to follow the average county 
yield. It is possible for you to have a low yield on the acreage 
that you farm and still not receive a payment under this plan.
    For limited or additional coverage you may select any percent 
coverage level shown on the Actuarial Table. Multiplying your 
coverage level percent by the expected county yield shown on the 
Actuarial Table gives your trigger yield. If the payment yield that 
FCIC publishes for the insured crop year falls below your trigger 
yield, you will receive a payment.
    You may select any dollar amount of protection between 60 and 
100 percent of the maximum dollar amount of protection shown on the 
Actuarial Table. This protection will be provided for each acre of 
the crop planted (unless otherwise provided in the crop provisions) 
in which you have a share, by the acreage reporting date.
    In accordance with the Act, the Government will pay a portion of 
your premium, as published in the Actuarial Table. The premium 
rates, practices, types, maximum protection per acre, and maximum 
subsidy per acre are also shown on the Actuarial Table.
    FCIC will issue the payment yield in the calendar year following 
the crop year insured. This yield will be the official estimated 
yield published by the National Agricultural Statistics Service 
(NASS), or successor agency. You will be paid if the payment yield 
falls below your trigger yield. The amount of your payment per net 
insured acre will be calculated by subtracting the payment yield 
from the trigger yield, dividing that quantity by the trigger yield, 
and multiplying that result by your protection per acre for each net 
acre that you have insured.
    To be eligible to participate in the Group Risk Plan of 
Insurance for any crop in any

[[Page 52721]]

county, and to receive an indemnity thereunder, you must have an 
insurable interest in an insured crop that is planted in the county 
shown on the approved application. The crop must be planted for 
harvest and be reported to us by the acreage reporting date. You may 
only purchase coverage under the Group Risk Plan of Insurance on 
your net acres of the insured crop.
    The insurance contract shall become effective upon the 
acceptance by us of a duly executed application for insurance on our 
form. Acceptance occurs when we issue a Summary of Protection to 
you. The policy shall consist of the accepted application, Group 
Risk Plan of Insurance Common Policy Basic Provisions, Crop 
Provisions, Special Provisions, Actuarial Table, and any amendments, 
endorsements, or options.

Agreement To Insure

    In return for your payment of the premium and your compliance 
with all applicable provisions, we agree to provide risk protection 
as stated in this policy. If a conflict exists among the Group Risk 
Plan Basic Provisions, the Crop Provisions, and the Special 
Provisions, the Special Provisions will control the Crop Provisions 
and the Group Risk Plan Basic Provisions; and the Crop Provisions 
will control the Group Risk Plan Basic Provisions.

Terms and Conditions--Group Risk Plan of Insurance Basic Provisions

1. Definitions

    Acreage report--A document that you must submit annually by the 
acreage reporting date, which contains the acreage planted to each 
insured crop, whether or not insurable, your report of your share of 
the insured crop, and any other information required by your 
insurance provider.
    Acreage reporting date--The date contained in the Special 
Provisions by which you must submit your acreage report in order to 
be eligible for Group Risk Insurance.
    Act--Federal Crop Insurance Act, as amended.
    Actuarial Table--The forms and related material approved by 
FCIC, which are available for public inspection in your insurance 
provider's local office. The Actuarial Table shows the maximum 
protection per acre, expected county yield, coverage levels, premium 
rates, program dates, Special Provisions, and other related 
information with respect to the insured crop in the county for the 
crop year.
    Billing date--The date, contained in the Actuarial Table, by 
which we will bill you for premium on the insured crop.
    Cancellation date--The calendar date specified in each Crop 
Provision on which insurance for the next crop year will 
automatically renew unless the policy is canceled in writing by 
either you or us prior to that date.
    County--A political subdivision of a State (also may be known as 
a parish or other name) that is stated on your accepted application.
    Crop practice--The combination of inputs such as fertilizer, 
herbicide, and pesticide, and operations such as planting, 
cultivation, and irrigation, used to produce the insured crop. The 
insurable practices are contained in the Actuarial Table.
    Crop provisions--The part of the policy that contains the 
specific terms of insurance for each insured crop.
    Crop year--The period of time within which the insured crop is 
normally grown, and is designated by the calendar year in which the 
crop is normally harvested.
    Expected county yield--The yield contained in the Actuarial 
Table, on which your coverage for the crop year is based. This yield 
is determined using historical NASS county average yields, adjusted 
for long term yield trends.
    FCIC--The Federal Crop Insurance Corporation, an agency of USDA.
    FSA--The Farm Service Agency or successor agency, USDA.
    GRP--Group Risk Plan of Insurance.
    Insurance provider--A private insurance company approved by FCIC 
which provides crop insurance coverage to producers participating in 
any Federal crop insurance program administered under the Act.
    MPCI--Multiple peril crop insurance offered under the authority 
of the Act.
    NASS--National Agricultural Statistics Service of the USDA or 
its successor, which publishes the official United States Government 
yield estimates.
    Net acres--The planted acreage of the insured crop multiplied by 
your share.
    Payment yield--The yield determined by FCIC based on NASS yields 
for each insurable crop's type and practice, and used to determine 
whether an indemnity will be due.
    Person--An individual, partnership, association, corporation, 
estate, trust, or other legal entity, and wherever applicable, a 
state or a political subdivision or agency of a state.
    Protection per acre--The dollar amount per acre selected by you 
for each insured crop practice and type specified in the Actuarial 
Table. Your protection per acre is shown on your Summary of 
Protection.
    Sales closing date--The date contained in the Actuarial Table by 
which you must file your signed application with us.
    Share--Your percentage of interest in the insured crop, as an 
owner, operator, or tenant. Premium will be determined on your share 
as of the acreage reporting date. Any indemnity which may be due 
will be determined based on your share on the acreage reporting date 
or on the date of harvest, whichever is less. You may insure only 
your share of the crop, which may include any share of your spouse 
and dependent children unless it is demonstrated to our 
satisfaction, prior to the sales closing date, that the farming 
operations of you and your spouse are maintained completely separate 
and apart from each other and that each spouse is the operator of 
his or her own separate operation. Any commingling of any part of 
the operations will cause shares of you and your spouse to be 
combined.
    Special Provisions--The part of the Actuarial Table that 
contains specific provisions of insurance for each crop that may 
vary by geographic area.
    Subsidy--The portion of your premium, shown as minimum and 
maximum amounts in the Actuarial Table, that the Government will pay 
in accordance with the Act.
    Summary of Protection--Our statement to you of the crop insured, 
protection per acre, premiums, and other information obtained from 
your accepted application, acreage report, and the Actuarial Table.
    Termination date--The calendar date contained in the Crop 
Provisions upon which insurance on your crop will cease due to your 
failure to pay premiums or any other amount you owe us.
    Trigger yield--The result of multiplying the expected county 
yield by the coverage level percentage chosen by you. When the 
payment yield falls below the trigger yield, a payment is made.
    Type--Plants of the insured crop having common traits or 
characteristics that distinguish them as a group or class, and which 
are designated in the Actuarial Table.
    USDA--United States Department of Agriculture.

2. Insured Crop

    The insured crop will be the crop shown on your accepted 
application and as specified in the applicable crop provisions, and 
must be grown on insurable acreage.

3. Insured and Insurable Acreage

    (a) The insurable acreage is all of the acreage of the insured 
crop for which premium rates are provided by the Actuarial Table and 
in which you have an interest and which acreage is in the county or 
counties listed in your accepted application. The protection per 
acre, amount of premium, and indemnity will be calculated separately 
for each county, type, and practice.
    (b) Only the acreage planted to the insured crop on or before 
the acreage reporting date (except forage) and physically located in 
the county or counties listed on your accepted application will be 
insured. Crops grown on acreage physically located in another county 
must be reported and insured separately.
    (c) We will not insure any crop grown on any acreage where the 
crop was destroyed or put to another use during the insurance period 
for the purpose of conforming with, or obtaining a payment under, 
any other program administered by the USDA.
    (d) We will not insure any acreage where you have failed to 
follow good farming practices for the insured crop.

4. Policy Protection

    (a) For catastrophic risk protection GRP policies, the dollar 
amount of protection per acre is shown on the Actuarial Table for 
each insured crop, practice, and type. For limited and additional 
coverage GRP policies, you may select any percentage of the maximum 
amount of protection per acre shown on the Actuarial Table for the 
crop, practice, and type.
    (b) The dollar amount of protection per acre, multiplied by your 
net insured acreage, is your policy protection for each insured 
crop, practice, and type specified in the Actuarial Table.

5. Coverage Levels

    (a) For catastrophic risk protection GRP policies, the coverage 
level is shown on the Actuarial Table for each insured crop,

[[Page 52722]]

practice, and type. For limited and additional coverage GRP 
policies, you may select any percentage of coverage shown on the 
Actuarial Table for the crop, practice, and type.
    (b) Your coverage level multiplied by the expected county yield 
shown on the Actuarial Table is your trigger yield. If the payment 
yield, published by FCIC for the insured crop, practice, and type 
for the insured crop year falls below your trigger yield, you will 
receive an indemnity payment.

6. Payment Calculation Factor

    Your payment calculation factor will be ((your trigger yield--
payment yield)your trigger yield) for the purposes of 
calculating the final payment.

7. Report of Acreage and Share

    (a) You must report on our form all acreage for each insured 
crop, practice, and type specified in the Actuarial Table in each 
county listed on your accepted application in which you have a 
share. This report must be submitted each year on or before the 
acreage reporting date for the insured crop contained in the 
Actuarial Table. If you do not submit an acreage report by the 
acreage reporting date, we may determine your acreage and share or 
deny liability on the policy.
    (b) We will not insure any acreage of the insured crop planted 
after the acreage reporting date.
    (c) Your premium will be based on the acreage reported as of the 
acreage reporting date or the acreage determined by us.
    (d) The payment of an indemnity will be based on your insurable 
acreage on the acreage reporting date or the date of harvest, 
whichever is less. If the insurable acreage at the date of harvest 
is less than the insurable acreage on the acreage report, a revised 
acreage report will be required prior to the payment of an 
indemnity. Neither the amount of acreage or your share may be 
revised to increase your policy protection.
    (e) If you misrepresent any information, we may revise the 
premium or liability or both for each insured crop in the county, by 
type and practice to the amount we determine to be correct.

8. Administrative Fees and Annual Premium

    (a) If you obtain a catastrophic risk protection GRP policy, you 
will pay an administrative fee of $50 per crop per county, not to 
exceed $200 per producer per county up to a maximum of $600 per 
producer, at the time of application. For continuous catastrophic 
risk protection policies in effect, the administrative fee will be 
paid on or before the acreage reporting date.
    (b) If you obtain a limited coverage GRP policy, you will pay an 
administrative fee of $50 per crop per county, not to exceed $200 
per county up to a maximum of $600 per producer. The administrative 
fee will be payable under the same terms and conditions as the 
premium for the policy.
    (c) If you obtain an additional coverage GRP policy, you will 
pay an administrative fee of $10 for each crop. The administrative 
fee will be payable under the same terms and conditions as the 
premium for the policy.
    (d) For limited and additional coverage GRP policies, your 
premium is determined by multiplying your policy protection times 
the premium rate per hundred dollars of protection for your coverage 
level, times 0.01, less the applicable subsidy.
    (e) The annual premium is earned and payable at the time the 
insured crop is planted. For each insured crop, you will be billed 
for premium by the billing date specified in the Special Provisions. 
Premium is due on the billing date and interest will accrue if the 
premium is not received by us before the first day of the month 
following the premium billing date.
    (f) The premium due, plus any accrued interest, will be 
considered delinquent if any amount due us is not received by us on 
or before the termination date listed in the crop provisions. This 
may affect your eligibility for benefits under other USDA programs. 
A debt for any crop insured with us under the authority of the Act 
will be deducted from any replant payment, indemnity due you for any 
other crop insured with us.
    (g) Failure to pay the premium due, plus any accrued interest 
and penalties, by the termination date will make you ineligible for 
any crop insurance under the Act for subsequent crop years until the 
debt, including interest and penalties, is paid.

9. Written Agreements

    As specified in the Crop Provisions, designated terms of the 
policy may be altered by written agreement. Each written agreement 
must be applied for by the producer in writing prior to the sales 
closing date and is valid for one year only. If not specifically 
renewed the following year, continuous insurance will be in 
accordance with the printed policy. All applications for written 
agreements as submitted by the producer must contain all variable 
terms of the contract between the insurance provider and the 
producer that will be in effect if the written agreement is not 
approved.

10. Access to Insured Crop and Record Retention

    We may examine the insured crop and any records relating to the 
crop and this insurance at any location where such crop or such 
records may be found or maintained, as often as we reasonably 
require. Records relating to the planting of the insured crop and 
your net acres must be retained for three years after the end of the 
crop year or three years after the date of payment of the final 
indemnity, whichever is later. Failure to maintain such records may, 
at our option, result in cancellation of the policy or determination 
that no indemnity is due.

11. Transfer of Right to Indemnity

    If you transfer any part of your share during the crop year, you 
also may transfer the equivalent part of your right to payment under 
this policy. Any transfer must be on our form and is effective upon 
our written approval. Both you and the person to whom you transfer 
your right are jointly and severally liable for payment of the 
premium.

12. Assignment of Indemnity

    You may assign your right to an indemnity payment to another 
person for the current crop year. The assignment must be on our form 
and is effective upon our written approval.

13. Other Insurance

    You may not obtain any other crop insurance product subsidized 
under the Act for the insured crop in the counties listed on your 
accepted application. If we determine that there is more than one 
policy in effect that covers your share, the policy with the 
earliest application date will be in effect and all later policies 
will be void.

[FCIC Policy]

14. Suit Against Us

    You cannot bring suit against us unless you have complied with 
all of the policy provisions and exhausted all administrative 
remedies. Any suit based on denial of a claim must be brought within 
one year after the date on which final notice of denial of the claim 
is provided to you. Any suit brought against us based on the denial 
of a claim must be brought in the United States district court in 
the district where your insured farm is located.

[Reinsured Policy]

14. Suit Against Us

    You cannot bring suit against us unless you have complied with 
all of the policy provisions. If you do file suit against us based 
on the denial of a claim, you must do so within one (1) year of the 
final notice of denial of the claim.

[FCIC Policy]

15. Restrictions, Limitations, and Amounts Due Us

    (a) We may restrict the amount of acreage we will insure to the 
amount allowed under any acreage limitation program established by 
the USDA.
    (b) Violation of Federal statutes including, but not limited to, 
the Act; the Food Security Act of 1985; the Food, Agriculture, 
Conservation, and Trade Act of 1990; and the Omnibus Budget 
Reconciliation Act of 1993, and any regulation promulgated 
thereunder, will result in cancellation, termination, or voidance of 
your crop insurance contract. You must repay any and all monies paid 
to you or received by you, and the amount of premium you paid less 
up to 30 percent for administrative expenses will be refunded to 
you.
    (c) Our maximum liability under this policy will be limited to 
the policy protection specified in section 4 of this policy. Under 
no circumstances will we be liable for the payment of damages 
(compensatory, punitive, or other), attorney's fees, or other 
charges in connection with any claim for indemnity, whether we 
approve or disapprove such indemnity.
    (d) Any delinquent amount due us may be deducted from any loan 
or payment due you under any Act of Congress or program administered 
by the USDA or its agencies or from any amount due you from any 
other United States Government agency.
    (e) Interest will accrue at the rate not to exceed one and one-
quarter percent (1\1/4\%) simple interest per calendar month, or any 
part thereof, on any unpaid premium

[[Page 52723]]

balance. Interest will begin to accrue on the first day of the month 
following the billing date.
    (f) We will pay simple interest computed on the net indemnity 
ultimately found to be due by us or determined by a final judgment 
of a court of competent jurisdiction or a final administrative 
determination from, and including, the 61st day after the date we 
receive the NASS county yield estimates for the insured crop year. 
Interest will be paid only if the reason for our failure to timely 
pay is not due to your failure to provide information or other 
material necessary for the computation or payment of the indemnity. 
The interest rate will be that established by the Secretary of the 
Treasury under section 12 of the Contract Disputes Act of 1978 (41 
U.S.C. 611), and published in the Federal Register.
    (g) For repayment of indemnities found not to have been earned, 
interest will start to accrue on the date that notice for the 
collection of the unearned amount is issued to you. Interest on the 
unearned amount will not be charged if payment is made in full 
within 30 days after the date shown on the notice issued to you. 
Interest and penalties will be charged in accordance with 31 U.S.C. 
3717 and 4 CFR part 102. The penalty for accounts more than 90 days 
past due is six percent (6%) per annum. See 31 U.S.C. 3717(e)(2) and 
4 CFR 122.13(e). Interest on any amount due us found to have been 
received by you because of fraud, misrepresentation, or presentation 
of a false claim by you will start on the date you received the 
amount, with the 6 percent (6%) penalty beginning 31days after the 
notice of amount due. This interest is in addition to any other 
amount found to be due under any other Federal criminal or civil 
statute.
    (h) If we determine that it is necessary to contract with a 
collection agency or to employ an attorney to assist in collection, 
you agree to pay all of the expenses of collection.
    (i) All amounts paid will be applied first to the expenses of 
collection, second to any penalties which may have been assessed, 
then to accrued interest, and finally, to reduction of the principal 
balance.

[Reinsured Policy]

15. Restrictions, Limitations, and Amounts Due Us

    (a) We may restrict the amount of acreage we will insure to the 
amount allowed under any acreage limitation program established by 
the USDA.
    (b) Violation of Federal statutes including, but not limited to, 
the Act; the Food Security Act of 1985; the Food, Agriculture, 
Conservation, and Trade Act of 1990; and the Omnibus Budget 
Reconciliation Act of 1993, and any regulation promulgated 
thereunder, will result in cancellation, termination, or voidance of 
your insurance contract. You must repay any and all monies paid to 
you or received by you, and the amount of premium you paid less 30 
percent for administrative expenses will be refunded.
    (c) Our maximum liability under this policy will be limited to 
the policy protection specified in section 4 of this policy. Under 
no circumstances will we be liable for the payment of other amounts 
including compensatory, punitive, or other damages, attorney's fees, 
or other charges in connection with any claim for indemnity, whether 
we approve or disapprove such indemnity.
    (d) For repayment of amounts found not to have been earned, such 
as overpaid indemnities, interest will start to accrue on the date 
notice for the collection of the unearned amount is issued to you. 
Interest on unearned amounts will not be charged if payment in full 
is made within 30 days after the date shown on the notice issued to 
you. For premium amounts due us, interest will start to accrue on 
the first day of the month following the premium billing date 
specified in the Special Provisions. Interest not to exceed one and 
one-quarter percent (1\1/4\%) simple interest per calendar month, 
will be charged on unearned indemnities and on past-due premium.
    (e) If we determine that it is necessary to contract with a 
collection agency or to employ an attorney to assist in collection, 
you agree to pay all of the expenses of collection.
    (f) All amounts paid will be applied first to the payment of 
expenses of collection, second to reduction of any penalties which 
may have been assessed, then to reduction of accrued interest, and, 
finally, to reduction of the principal balance.

[Both Policies]

16. Death, Disappearance, or Incompetence of the Insured

    If, after insurance attaches, you die, disappear, or are 
judicially declared incompetent, or if you are a person other than 
an individual and such person is dissolved, any payment due will be 
paid to the person legally determined to be beneficially entitled to 
it. If such events occur prior to the attachment of insurance, the 
policy will terminate as of the date of death, judicial declaration, 
or dissolution.

[FCIC Policy]

17. Determinations

    All determinations required by the policy will be made by us. If 
you disagree with our determinations, you may obtain reconsideration 
or you may appeal our determinations in accordance with 7 CFR parts 
11 and 780.

[Reinsured Policy]

17. Determinations

    If a dispute arises out of or relates to this policy, at the 
election of either of us, such dispute shall be settled by 
arbitration in accordance with the rules of the American Arbitration 
Association. If arbitration is elected by either party, no suit at 
law or in equity based on such disputes shall be instituted by 
either party, other than to enforce the decision in arbitration.

[Both Policies]

18. Holidays and Weekends

    If any date specified in this program falls on Saturday, Sunday, 
or a legal Federal holiday, then the date will be extended to the 
next business day.

19. Life of Policy and Policy Renewal

    (a) This is a continuous policy that remains in effect unless it 
is canceled in writing by either you or us on or before the 
cancellation date.
    (b) This policy will automatically terminate for the subsequent 
crop year if you have not paid any amount due us by the termination 
date.
    (c) You may change the coverage level or amount of protection 
for each insured crop on or before the sales closing date. Changes 
must be in writing and received by us by the sales closing date.
    (d) The cancellation and termination dates are contained in the 
Crop Provisions for each insured crop.

20. Policy Changes

    We may change any terms and conditions of this policy from year 
to year. All policy changes will be filed in your insurance 
provider's office before the contract change date for the insured 
crop contained in the Crop Provisions. You will be advised of policy 
changes by written notice mailed to the address of record contained 
in your insurance provider's office. This notice will be mailed as 
soon after the contract change date as practical.

An Example To Demonstrate How GRP Works

    Producer A buys ninety percent (90%) coverage and selects $160 
protection per acre. Producer B buys seventy-five percent (75%) 
coverage and selects $185 protection per acre. Both producers have 
one-hundred percent (100%) share and both plant 200 acres of a crop 
in the county. The expected county yield is 45 bushels. The premium 
rate for ninety percent (90%) coverage is $6.14 per hundred dollars 
of protection and the premium rate for seventy-five percent (75%) 
coverage is $3.30 per hundred dollars of protection. The maximum 
subsidy amount per acre is $3.07 and the limited subsidy amount is 
$2.21 per acre.
    A's trigger yield is 40.5 bushels per acre (90% of 45), and the 
total premium due is $1,965 ($160 multiplied by $6.14 multiplied by 
200 acres multiplied by 0.01). Of that amount, FCIC pays $614 (200 
acres multiplied by the maximum subsidy of $3.07 per acre). A's 
policy protection is $32,000 ($160 multiplied by 200 acres). B's 
trigger yield is 33.8 bushels per acre (75% of 45), and the total 
premium due is $1,221 ($185 multiplied by $3.30 multiplied by 200 
acres multiplied by 0.01). Of that amount, FCIC pays $442 (200 acres 
multiplied by the limited subsidy amount of $2.21 per acre). B's 
policy protection is $37,000 ( $185 multiplied by 200 acres).

Scenario 1 (Likely)

    FCIC issues a payment yield of 46 bushels per acre. This is 
above both producers' trigger yields, so no indemnity payment is 
made, even if one or both of them have low individual yields.

Scenario 2 (Less Likely)

    FCIC issues a payment yield of 38 bushels per acre. A's payment 
calculation factor is 0.062 ((40.5-38)40.5)). This number

[[Page 52724]]

multiplied by the policy protection yields an indemnity payment of 
$1,984 (.062 multiplied by $32,000). B's trigger yield is below the 
payment yield, so no indemnity payment is made.

Scenario 3 (Least Likely)

    FCIC issues a payment yield of 22 bushels per acre. A's payment 
calculation-factor of 0.457 ((40.5-22)40.5). The payment is 
$14,624 (0.457 multiplied by $32,000). B's payment calculation 
factor is 0.349 ((33.8-22)33.8), and the final indemnity 
payment is $12,913 (0.349 multiplied by $37,000).

[Both Policies]

21. Eligibility for Other Farm Program Benefits

    If GRP, or any other plan of insurance, is available in the 
county, to remain eligible for benefits under the Agriculture 
Marketing Transition Act, the conservation reserve program, or 
certain farm loans, you are required to obtain at least the 
catastrophic level of either GRP or such other insurance for all 
crops of economic significance or execute a waiver of your rights to 
any emergency crop assistance on or before the sales closing date 
for the crop.


Sec. 407.10  Group Risk Plan for Barley.

1. Definitions

    Harvest--Combining or threshing the barley for grain.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of barley in the county by the NASS estimate of 
the acres of barley for each type and practice contained in the 
Actuarial Table. The Actuarial Table states whether harvested or 
planted acres of barley are used to establish the expected county 
yield and calculate indemnities.
    Planted Acreage--Land in which the barley seed has been placed 
by a machine appropriate for the insured crop and planting method, 
at the correct depth, into a seedbed that has been properly prepared 
for the planting method and production practice. Land on which seed 
is initially spread onto the soil surface by any method and which 
subsequently is mechanically incorporated into the soil in a timely 
manner and at the proper depth, will also be considered planted.

2. Crop Insured

    The insured crop will be all barley:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date;
    (c) Planted with the intent to be harvested as grain; and
    (d) Not planted into an established grass or legume, 
interplanted with another crop, or planted as a nurse crop, unless 
seeded at the normal rate and intended for harvest as grain.

3. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to the April 1 
following the crop year.
    (c) We will issue any payment to you prior to the May 1 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified in the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

4. Program Dates

----------------------------------------------------------------------------------------------------------------
            State and county                 Cancellation and termination dates         Contract change date    
----------------------------------------------------------------------------------------------------------------
Kit Carson, Lincoln, Elbert, El Paso,     September 30............................  June 30.                    
 Pueblo, Las Animas Counties, Colorado                                                                          
 and all Colorado Counties south and                                                                            
 east thereof; all New Mexico counties                                                                          
 except Taos County; Kansas; Missouri;                                                                          
 Illinois; Indiana; Ohio; Pennsylvania;                                                                         
 New York; Massachusetts; and all states                                                                        
 south and east thereof.                                                                                        
Arizona; California; and Clark and Nye    October 31..............................  June 30.                    
 Counties, Nevada.                                                                                              
All Colorado counties except Kit Carson,  March 15................................  November 30.                
 Lincoln, Elbert, EL Paso, Pueblo, and                                                                          
 Las Animas Counties and all Colorado                                                                           
 counties south and east thereof; all                                                                           
 Nevada counties except Clark and Nye                                                                           
 Counties; Taos County, New Mexico; and                                                                         
 all other states except: Arizona,                                                                              
 California, and (except) Kansas,                                                                               
 Missouri, Illinois, Indiana, Ohio,                                                                             
 Pennsylvania, New York, and                                                                                    
 Massachusetts and all States south and                                                                         
 east thereof.                                                                                                  
----------------------------------------------------------------------------------------------------------------

Sec. 407.11 Group Risk Plan for Corn.

1. Definitions

    Harvest--Combining or picking corn for grain, or severing the 
stalk from the land and chopping the stalk and ear for the purpose 
of livestock feed.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of corn in the county by the NASS estimate of the 
acres of corn, for each type and practice contained in the Actuarial 
Table. The Actuarial Table states whether harvested or planted acres 
of corn are used to establish the expected county yield and 
calculate indemnities.
    Planted acreage--Land in which the corn seed has been placed by 
a machine appropriate for the insured crop and planting method, at 
the correct depth, into a seedbed that has been properly prepared 
for the planting method and production practice.

2. Crop Insured

    The insured crop will be all field corn:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date;
    (c) Planted with the intent to be harvested as grain or silage; 
and
    (d) Not planted into an established grass or legume or 
interplanted with another crop.
    Hybrid seed corn, popcorn, sweet corn, and other specialty corn 
may be insured only if a written agreement exists between you and 
us. Your request to insure such crop must be in writing and 
submitted to your agent not later than the sales closing date.

3. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to April 16 
following the crop year.
    (c) We will issue any payment to you prior to the May 16 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified in the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

4. Program Dates

----------------------------------------------------------------------------------------------------------------
            State and county                 Cancellation and termination dates         Contract change date    
----------------------------------------------------------------------------------------------------------------
Val Verde, Edwards, Kerr, Kendall,        January 15..............................  November 30.                
 Bexar, Wilson, Karnes, Goliad,                                                                                 
 Victoria, and Jackson Counties, Texas,                                                                         
 and all Texas counties lying south                                                                             
 thereof.                                                                                                       
El Paso, Hudspeth, Culberson, Reeves,     February 15.............................  November 30.                
 Loving, Winkler, Ector, Upton, Reagan,                                                                         
 Sterling, Coke, Tom Green, Concho,                                                                             
 McCulloch, San Saba, Mills, Hamilton,                                                                          
 Bosque, Johnson, Tarrant, Wise, and                                                                            
 Cooke Counties, Texas, and all Texas                                                                           
 Counties lying south and east thereof                                                                          
 to and including Terrell, Crockett,                                                                            
 Sutton, Kimble, Gillespie, Blanco,                                                                             
 Comal, Guadalupe, Gonzales, De Witt,                                                                           
 Lavaca, Colorado, Wharton, and                                                                                 
 Matagorda Counties, Texas.                                                                                     

[[Page 52725]]

                                                                                                                
Alabama; Arizona; Arkansas; California;   February 28.............................  November 30.                
 Florida; Georgia; Louisiana;                                                                                   
 Mississippi; Nevada; North Carolina;                                                                           
 South Carolina.                                                                                                
All other Texas counties and all other    March 15................................  November 30.                
 states.                                                                                                        
----------------------------------------------------------------------------------------------------------------

Sec. 407.12  Group Risk Plan for Cotton.

1. Definitions

    Harvest--Removal of the seed cotton from the stalk.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of cotton in the county by the NASS estimate of 
the acres of cotton, for each type and practice contained in the 
Actuarial Table. The Actuarial Table states whether harvested or 
planted acres of cotton are used to establish the expected county 
yield and calculate indemnities.
    Planted acreage--Land in which the cotton seed has been placed 
by a machine appropriate for the insured crop and planting method, 
at the correct depth, into a seedbed that has been properly prepared 
for the planting method and production practice.

2. Crop Insured

    The insured crop will be all cotton:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date;
    (c) Planted with the intent to be harvested; and
    (d) Not colored lint cotton planted into an established grass or 
legume, interplanted with another spring planted crop, grown on 
acreage where hay was harvested in the same calendar year unless 
irrigated, grown on acreage where a small grain crop reached the 
heading stage unless irrigated.

3. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to July 16 following 
the crop year.
    (c) We will issue any payment to you prior to the August 16 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified in the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

4. Program Dates

----------------------------------------------------------------------------------------------------------------
            State and county                 Cancellation and termination dates         Contract change date    
----------------------------------------------------------------------------------------------------------------
Val Verde, Edwards, Kerr, Kendall,        January 15..............................  November 30.                
 Bexar, Wilson, Karnes, Goliad,                                                                                 
 Victoria, and Jackson Counties, Texas,                                                                         
 and all Texas counties lying south                                                                             
 thereof.                                                                                                       
Alabama; Arizona; Arkansas; California;   February 28.............................  November 30.                
 Florida; Georgia; Louisiana;                                                                                   
 Mississippi; Nevada; North Carolina;                                                                           
 South Carolina; El Paso, Hudspeth,                                                                             
 Culberson, Reeves, Loving, Winkler,                                                                            
 Ector, Upton, Reagan, Sterling, Coke,                                                                          
 Tom Green, Concho, McCulloch, San Saba,                                                                        
 Mills, Hamilton, Bosque, Johnson,                                                                              
 Tarrant, Wise, and Cooke Counties,                                                                             
 Texas, and all Texas counties lying                                                                            
 south and east thereof to and including                                                                        
 Terrell, Crockett, Sutton, Kimble,                                                                             
 Gillespie, Blanco, Comal, Guadalupe,                                                                           
 Gonzales, De Witt, Lavaca, Colorado,                                                                           
 Wharton, and Matagorda Counties, Texas.                                                                        
All other Texas counties and all other    March 15................................  November 30.                
 States.                                                                                                        
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Sec. 407.13  Group Risk Plan for Forage.

1. Definitions

    Harvest--Removal of the forage from the field, and rotational 
grazing.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of the crop practice and type shown on the 
Actuarial Table for this purpose by the NASS estimate of the acres 
of such crop harvested that year in the county, for each practice 
and type contained in the Actuarial Table.
    Planted acreage--Land seeded to forage, by a planting method 
appropriate for forage, into a properly prepared seedbed.
    Rotational grazing--The defoliation of the insured forage by 
livestock, within a pasturing system where the forage field is 
subdivided into smaller parcels and livestock are moved from one 
area to another, allowing a period of grazing followed by a period 
for forage regrowth.

2. Crop Insured

    The insured crop will be the forage types shown on the Special 
Provisions:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date;
    (c) Intended for harvest; and
    (d) Not grown with another crop.

3. Insurable Acreage

    In lieu of section 3. (Insured and Insurable Acreage) of the 
Basic Provisions of the Group Risk Plan Common Policy (Sec. 407.9), 
only acreage seeded to forage on or before July 1 of the previous 
crop year and physically located in the counties listed on your 
application will be insurable. Acreage physically located in another 
county not listed on the accepted application is not insured under 
this policy.

4. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to May 1 following 
the crop year.
    (c) We will issue any payment to you prior to the May 31 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified in the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

5. Program Dates

    November 30 is the Cancellation and Termination Date for all 
States. The Contract Change Date is June 30 for all States.

6. Annual Premium

    In lieu of Provision 6(b) of the Basic Provisions of the Group 
Risk Plan Common Policy, the annual premium is earned and payable on 
the acreage reporting date. You will be billed for premium due on 
the date shown in the Special Provisions. The premium will be 
determined based on the rate shown on the Actuarial Table.


Sec. 407.14  Group Risk Plan for Sorghum.

1. Definitions

    Harvest--Combining or threshing the sorghum for grain, or 
severing the stalk from the land and chopping the stalk and head for 
the purpose of livestock feed.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of sorghum in the county by the NASS estimate of 
the acres of sorghum, for each type and practice contained in the 
Actuarial Table. The Actuarial Table states whether harvested or 
planted acres of sorghum are used to establish the expected county 
yield and calculate indemnities.
    Planted acreage--Land in which the sorghum seed has been placed 
by a machine

[[Page 52726]]

appropriate for the insured crop and planting method, at the correct 
depth, into a seedbed that has been properly prepared for the 
planting method and production practice.

2. Crop Insured

    The insured crop will be all sorghum:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date;
    (c) Planted with the intent to be harvested as grain or silage; 
and
    (d) Not interplanted with an established grass or legume or 
interplanted with another crop.
    Hybrid sorghum seed may be insured only if a written agreement 
exists between you and us. Your request to insure such crop must be 
in writing and submitted to your agent not later than the sales 
closing date.

3. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to April 16 
following the crop year.
    (c) We will issue any payment to you prior to the May 16 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified in the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

4. Program Dates

----------------------------------------------------------------------------------------------------------------
            State and county                 Cancellation and termination dates         Contract change date    
----------------------------------------------------------------------------------------------------------------
Val Verde, Edwards, Kerr, Kendall,        January 15..............................  November 30.                
 Bexar, Wilson, Karnes, Goliad,                                                                                 
 Victoria, and Jackson Counties, Texas,                                                                         
 and all Texas counties lying south                                                                             
 thereof.                                                                                                       
El Paso, Hudspeth, Culberson, Reeves,     February 15.............................  November 30.                
 Loving, Winkler, Ector, Upton, Reagan,                                                                         
 Sterling, Coke, Tom Green, Concho,                                                                             
 McCulloch, San Saba, Mills, Hamilton,                                                                          
 Bosque, Johnson, Tarrant, Wise, Cooke                                                                          
 Counties, Texas, and all Texas counties                                                                        
 south and east thereof to and including                                                                        
 Terrell, Crockett, Sutton, Kimble,                                                                             
 Gillespie, Blanco, Comal, Guadalupe,                                                                           
 Gonzales, De Witt, Lavaca, Colorado,                                                                           
 Wharton, and Matagorda Counties, Texas.                                                                        
Alabama; Arizona; Arkansas; California;   February 28.............................  November 30.                
 Florida; Georgia; Louisiana;                                                                                   
 Mississippi; Nevada; North Carolina;                                                                           
 and South Carolina.                                                                                            
All other Texas counties and all other    March 15................................  November 30.                
 states.                                                                                                        
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Sec. 407.15   Group Risk Plan for Peanuts.

1. Definitions

    Harvest--Combining or threshing the peanuts.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of peanuts in the county by the NASS estimate of 
the acres of peanuts, for each type and practice contained in the 
Actuarial Table. The Actuarial Table states whether harvested or 
planted acres of peanuts are used to establish the expected county 
yield and calculate indemnities.
    Planted acreage--Land in which the peanut seed has been placed 
by a machine appropriate for the insured crop and planting method, 
at the correct depth, into a seedbed that has been properly prepared 
for the planting method and production practice.

2. Crop Insured

    The insured crop will be all peanuts:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date; 
and
    (c) Planted with the intent to be harvested as peanuts.

3. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to June 16 following 
the crop year.
    (c) We will issue any payment to you prior to the July 16 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified in the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

4. Program Dates

----------------------------------------------------------------------------------------------------------------
            State and County                 Cancellation and termination dates         Contract change date    
----------------------------------------------------------------------------------------------------------------
Jackson, Victoria, Goliad, Bee, Live      January 15..............................  November 30.                
 Oak, McMullen, La Salle, and Dimmit                                                                            
 Counties, Texas and all Texas Counties                                                                         
 lying south thereof..                                                                                          
El Paso, Hudspeth, Culberson, Reeves,     February 28.............................  November 30.                
 Loving, Winkler, Ector, Upton, Reagan,                                                                         
 Sterling, Coke, Tom Green, Concho,                                                                             
 McCulloch, San Saba, Mills, Hamilton,                                                                          
 Bosque, Johnson, Tarrant, Wise, Cooke                                                                          
 Counties, Texas, and all Texas counties                                                                        
 south and east thereof; and all other                                                                          
 states.                                                                                                        
New Mexico; Oklahoma; and all other       March 15................................  November 30.                
 Texas Counties.                                                                                                
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Sec. 407.16   Group Risk Plan for Soybeans.

1. Definitions

    Harvest--Combining or threshing the soybeans.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of soybeans in the county by the NASS estimate of 
the acres of soybeans, for each type and practice contained in the 
Actuarial Table. The Actuarial Table states whether harvested or 
planted acres of soybeans are used to establish the expected county 
yield and calculate the indemnities.
    Planted acreage--Land in which the soybean seed has been placed 
by a machine appropriate for the insured crop and planting method, 
at the correct depth, into a seedbed that has been properly prepared 
for the planting method and production practice. Land on which seed 
is initially spread onto the soil surface by any method and which 
subsequently is mechanically incorporated into the soil in a timely 
manner and at the proper depth, will also be considered planted.

2. Crop Insured

    The insured crop will be all soybeans:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date;
    (c) Planted with the intent to be harvested as soybeans; and

[[Page 52727]]

    (d) Not planted into an established grass or legume or 
interplanted with another crop.

3. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to April 16 
following the crop year.
    (c) We will issue any payment to you prior to the May 16 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified on the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

4. Program Dates

----------------------------------------------------------------------------------------------------------------
            State and county                 Cancellation and termination dates         Contract change date    
----------------------------------------------------------------------------------------------------------------
Jackson, Victoria, Goliad, Bee, Live      February 15.............................  November 30.                
 Oak, McMullen, La Salle, and Dimmit                                                                            
 Counties, Texas and all Texas counties                                                                         
 lying south thereof.                                                                                           
Alabama; Arizona; Arkansas; California;   February 28.............................  November 30.                
 Florida; Georgia; Louisiana;                                                                                   
 Mississippi; Nevada; North Carolina;                                                                           
 South Carolina; and El Paso, Hudspeth,                                                                         
 Culberson, Reeves, Loving, Winkler,                                                                            
 Ector, Upton, Reagan, Sterling, Coke,                                                                          
 Tom Green, Concho, McCulloch, San Saba,                                                                        
 Mills, Hamilton, Bosque, Johnson,                                                                              
 Tarrant, Wise, and Cooke Counties,                                                                             
 Texas, and all Texas counties lying                                                                            
 south and east thereof to and including                                                                        
 Maverick, Zavala, Frio, Atascosa,                                                                              
 Karnes, De Witt, Lavaca, Colorado,                                                                             
 Wharton, and Matagorda Counties, Texas.                                                                        
All other Texas counties and all other    March 15................................  November 30.                
 states.                                                                                                        
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Sec. 407.17  Group Risk Plan For Wheat.

1. Definitions

    Harvest--Combining or threshing the wheat for grain.
    NASS yield--The yield calculated by dividing the NASS estimate 
of the production of wheat in the county by the NASS estimate of the 
acres of wheat, for each type and practice contained in the 
Actuarial Table. The Actuarial Table states whether harvested or 
planted acres of wheat are used to establish the expected county 
yield and calculate indemnities.
    Planted acreage--Land in which the wheat seed has been planted 
by a machine appropriate for the insured crop and planting method, 
at the correct depth, into a seedbed that has been properly prepared 
for the planting method and production practice. Land on which seed 
is initially spread onto the soil surface by any method and which 
subsequently is mechanically incorporated into the soil in a timely 
manner and at the proper depth, will also be considered planted.

2. Crop Insured

    The insured crop will be all wheat:
    (a) Grown on insurable acreage in the county or counties listed 
in the accepted application;
    (b) Properly planted and reported by the acreage reporting date;
    (c) Planted with the intent to be harvested as grain; and
    (d) Not planted into an established grass or legume, 
interplanted with another crop, or planted as a nurse crop, unless 
seeded at the normal rate and intended for harvest as grain.

3. Payment

    (a) A payment will not be made unless your trigger yield is less 
than the payment yield for the insured crop year.
    (b) Payment yields will be determined prior to April 1 following 
the crop year.
    (c) We will issue any payment to you prior to the May 1 
immediately following our determination of the payment yield.
    (d) The payment is equal to the payment calculation factor 
multiplied by your policy protection for each insured crop practice 
and type specified in the Actuarial Table.
    (e) The payment will not be revised even though the NASS yield 
may be subsequently revised.

4. Program Dates

----------------------------------------------------------------------------------------------------------------
            State and county                 Cancellation and termination dates         Contract change date    
----------------------------------------------------------------------------------------------------------------
All Colorado counties except Alamosa,     September 30............................  June 30.                    
 Conejos, Costilla, Rio Grande, and                                                                             
 Saguache; all Montana counties except                                                                          
 Daniels, Roosevelt, Sheridan, and                                                                              
 Valley Counties; all South Dakota                                                                              
 counties except Harding, Perkins,                                                                              
 Corson, Walworth, Edmunds, Faulk,                                                                              
 Spink, Beadle, Kingsbury, Miner,                                                                               
 McCook, Turner, and Yankton Counties                                                                           
 and all South Dakota counties north and                                                                        
 east thereof; all Wyoming counties                                                                             
 except Big Horn, Fremont, Hot Springs,                                                                         
 Park, and Washakie Counties; and all                                                                           
 other states except Alaska, Arizona,                                                                           
 California, Maine, Minnesota, Nevada,                                                                          
 New Hampshire, North Dakota, Utah, and                                                                         
 Vermont.                                                                                                       
Arizona; California; Nevada; and Utah...  October 31..............................  June 30.                    
Alaska; Alamosa, Conejos, Costilla, Rio   March 15................................  November 30.                
 Grande, and Saguache Counties,                                                                                 
 Colorado; Maine; Minnesota; Daniels,                                                                           
 Roosevelt, Sheridan, and Valley                                                                                
 Counties, Montana; New Hampshire; North                                                                        
 Dakota; Harding, Perkins, Corson,                                                                              
 Walworth, Edmunds, Faulk, Spink,                                                                               
 Beadle, Kingsbury, Miner, McCook,                                                                              
 Turner, and Yankton Counties South                                                                             
 Dakota, and all South Dakota counties                                                                          
 north and east thereof; Vermont; and                                                                           
 Big Horn, Fremont, Hot Springs, Park,                                                                          
 and Washakie Counties, Wyoming.                                                                                
----------------------------------------------------------------------------------------------------------------

    Signed in Washington, DC, on October 1, 1996.
Kenneth D. Ackerman,
 Manager, Federal Crop Insurance Corporation.
[FR Doc. 96-25640 Filed 10-07-96; 8:45 am]
BILLING CODE 3410-FA-P