[Federal Register Volume 62, Number 120 (Monday, June 23, 1997)]
[Notices]
[Pages 33812-33824]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-16272]


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DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation


Revenue Assurance

ACTION: Notice of availability.

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SUMMARY: In accordance with section 508(h) of the Federal Crop 
Insurance Act (Act), the Federal Crop Insurance Corporation (FCIC) 
Board of Directors (Board) approves the insurance of corn and soybeans 
in select states and counties under the Revenue Assurance plan of 
insurance. This notice is intended to inform eligible producers and the 
private insurance industry of the availability of the Revenue Assurance 
plan of insurance and its terms and conditions.

FOR FURTHER INFORMATION CONTACT: Timothy Hoffmann, Director, Product 
Development Division, Federal Crop Insurance Corporation, United States 
Department of Agriculture, 9435 Holmes Road, Kansas City, Missouri, 
64131, telephone, (816) 926-7387.

SUPPLEMENTARY INFORMATION: Section 508(h) of the Act allows for the 
submission of a policy to FCIC's Board and authorizes the Board to 
review and, if the Board finds that the interests of producers are 
adequately protected and that any premiums charged to the producers are 
actuarially appropriate, approve the policy for reinsurance and 
subsidy, in accordance with section 508(e) of the Act.
    In accordance with the Act, the Board approved a program of 
insurance known as Revenue Assurance, originally submitted by Farm 
Bureau Mutual Insurance Company.
    The Revenue Assurance program has been approved for reinsurance and 
premium subsidy, including subsidy for administrative and operating 
expenses. Revenue Assurance is designed to protect a producer's loss of 
revenue resulting from low prices, low yields, or a combination of 
both. The Revenue Assurance policy provides coverage on basic units, 
optional units, enterprise units, or whole-farm units as selected by 
the producer.
    The Revenue Assurance program is available for corn and soybeans in 
all counties of Iowa beginning with the 1997 crop year.
    Upon a written request, FCIC will provide the Revenue Assurance 
underwriting rules, rate factors and forms for corn and soybeans. FCIC 
will also make available the terms and conditions of the Revenue 
Assurance reinsurance agreement. Requests for such information should 
be sent to Timothy Hoffmann, at the above stated address.
    FCIC herewith gives notice of the availability of the Revenue 
Assurance program of insurance for use by private

[[Page 33813]]

sector insurance companies for the 1997 crop year.
    Notice: The terms and provisions for the Revenue Assurance program 
of insurance are as follows:

Revenue Assurance Insurance Policy

    This policy is reinsured by the Federal Crop Insurance Corporation 
(FCIC) under the provisions of section 508(h) of the Federal Crop 
Insurance Act, as amended 7 U.S.C. 1508(h). The provisions of the 
policy may not be waived or varied in any way by the crop insurance 
agent or any other agent or employee of the company. In the event we 
cannot pay your loss, your claim will be settled in accordance with the 
provisions of this policy and paid by the FCIC. No state guarantee fund 
will be liable to pay your loss. Throughout this policy, ``you'' and 
``your'' refer to the named insured shown on the accepted application 
and ``we'', ``us'' and ``our'' refer to the Company. Unless the context 
indicates otherwise, use of the plural form of a word includes the 
singular and use of the singular form of the word includes the plural.
    Agreement to Insure: In return for the payment of the premium, and 
subject to all of the provisions of this policy, we agree with you to 
provide the insurance as stated in this policy. If a conflict exists 
among the Basic Provisions, these Crop Provisions, and the Special 
Provisions, the Special Provisions will control these Crop Provisions 
and the Basic Provisions, and these Crop Provisions will control the 
Basic Provisions.

Basic Provisions--Terms and Conditions

1. Definitions

    As used in this policy these terms are defined as follows:
    Abandon--Failure to continue providing sufficient care (For 
example, cultivation, irrigation, fertilization, application of 
chemicals, etc., consistent with good farming practices) for the 
insured crop to make normal progress toward harvest or maturity, or 
failure to harvest in a timely manner if harvest is practicable.
    Acreage report--A report required by section 7 of these Basic 
Provisions which contains, in addition to other required information, 
your report of your share of all acreage of an insured crop in the 
county whether insurable or not insurable. This report must be filed 
not later than the final acreage reporting date contained in the 
Special Provisions for the county for the insured crop.
    Acreage reporting date--The date (contained in the Special 
Provisions) by which you are required to submit your acreage report.
    Act--The Federal Crop Insurance Act, as amended, 7 U.S.C. 1501 et 
seq.
    Another use, notice of--The written notice required when you wish 
to put acreage to another use (see section 15).
    Application--The form required to be completed by you and accepted 
by us before insurance coverage will commence. This form must be 
completed and filed in your agent's office not later than the sales 
closing date of the initial insurance year for each crop for which 
insurance coverage is requested. If a break in insurance coverage 
occurs, a new application must be filed.
    Approved yield--The average amount of production per acre obtained 
under the Actual Production History Program (7 CFR part 400, subpart G) 
using production records of the insured or yields assigned by FCIC. At 
least four crop years of yields must be averaged to obtain the approved 
yield.
    Assignment of indemnity--A transfer of policy rights, made on our 
form, and effective when approved by us. It is the arrangement whereby 
you assign your right to an indemnity payment to any party of your 
choice for the crop year.
    Cancellation date--The calendar date specified in section 3(b) on 
which the policy will automatically renew unless canceled in writing by 
either you or us.
    Claim for indemnity--A claim made on our form by you for damage or 
loss to an insured crop and submitted to us not later than 60 days 
after the end of the insurance period (see section 15).
    Consent--Approval in writing by us allowing you to take a specific 
action.
    Contract--(also see ``Policy'') A contract for insurance between 
you and us consisting of the accepted Application, these Basic 
Provisions, the Crop Provisions, and the Special Provisions.
    Contract change date--The calendar date by which we make any 
contract (policy) changes available for inspection in the agent's 
office (see section 5).
    County--The political subdivision of a state shown on your accepted 
application, including land in a field that extends into an adjoining 
county when the county boundary is not readily discernible.
    Coverage level percent (CLP)--The percent determined by dividing 
the selected per-acre revenue guarantee (see section 1 of the Crop 
Provisions) by the expected per-acre revenue (see section 1 of the Crop 
Provisions) rounded to hundredths. The maximum allowable coverage level 
percent is 75 and the minimum allowable is 65. This coverage level 
percent is expressed in decimal form (.xxxx) to compute the per-acre 
revenue guarantee for all units and is expressed as a percent (xx.xx) 
to compute the premium subsidy factor.
    Coverage begins, date--The calendar date insurance begins on the 
insured crop, as contained in the Crop Provisions, or the date after 
planting is started on the unit (see section 12).
    Crop provisions--The part of the policy that contains the specific 
provisions of insurance for each insured crop.
    Crop year--The period within which the insured crop is normally 
grown and designated by the calendar year in which the insured crop is 
normally harvested.
    Damage--Injury, deterioration, or loss of production of the insured 
crop due to insured or uninsured causes.
    Damage, notice of--A written notice required to be filed in your 
agent's office whenever you initially discover the insured crop has 
been physically damaged to the extent that a loss is probable (see 
section 15).
    Delinquent account--Any account you have with us in which premiums, 
or interest on those premiums is not paid by the termination date 
specified in the crop provisions, or any other amounts due us, such as 
indemnities found not to have been earned, which are not paid within 30 
days of our mailing or other delivery of notification to you of the 
amount due.
    Earliest planting date--The earliest date established for planting 
the insured crop and qualifying for a replant payment if applicable 
(see Special Provisions and section 14).
    End of insurance period, date of--The date upon which your crop 
insurance coverage ceases for the crop year (see Crop Provisions and 
section 12).
    FSA--The Farm Service Agency of the United States Department of 
Agriculture (formerly the Agricultural Stabilization and Conservation 
Service), or a successor agency.
    FSA Farm Serial Number--The number assigned to the farm by the FSA 
County Committee.
    Insured--The named person as shown on the Application accepted by 
us. This term does not extend to any other person having a share or 
interest in the crop (for example, a partnership, landlord, or any 
other person) unless specifically indicated on the accepted application 
(see definition of ``Person'' section 1).
    Insured crop--The crop defined under these Basic Provisions and the 
applicable Crop Provisions as shown on the application accepted by us.
    Loss, notice of--The notice required to be given by you not later 
than 72

[[Page 33814]]

hours after certain occurrences or 15 days after the end of the 
insurance period (see section 15).
    MPCI--Multiple peril crop insurance program, a program of insurance 
offered under the Act and implemented in 7 CFR part 400.
    Negligence--The failure to use such care as a reasonably prudent 
and careful person would use under similar circumstances.
    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.
    Policy--(also see ``Contract'') A contract for insurance between 
you and us consisting of the accepted Application, these Basic 
Provisions, the Crop Provisions, and the Special Provisions.
    Practical to replant--Our determination, after loss or damage to 
the insured crop, based on factors including, but not limited to 
moisture availability, condition of the field, and time to crop 
maturity, that replanting to the insured crop will allow the crop to 
attain maturity prior to the calendar date for the end of the insurance 
period. It will not be considered practical to replant after the end of 
the late planting period unless replanting is generally occurring in 
the area.
    Premium billing date--The earliest date upon which you will be 
billed for insurance coverage based on your acreage report and which 
generally falls at or near harvest time.
    Premium calculator--The computer software for the crop year which 
shows coverage levels, premium rates, practices, acreage, and other 
related information regarding Revenue Assurance in the county.
    Production report--A written record showing your annual production 
and used by us to determine your yield for insurance purposes (see 
section 4). The report contains previous years yield information 
including planted acreage and harvested production. This report must be 
supported by written verifiable records from a warehouseman or buyer of 
the insured crop or by measurement of farm stored production, or by 
other records of production approved by us on an individual case basis.
    Reporting date--The acreage reporting date (contained in the 
Special Provisions) by which you are required to report all your 
insurable acreage in the county in which you have a share and your 
share at the time insurance attaches, and any acreage in which you have 
a share which is not insured (see section 10).
    Representative sample--Portions of the insured crop or insured crop 
residue which are required to remain in the field for examination and 
review by our loss adjusters when making a crop appraisal if required 
by the crop provisions. The samples are further defined in the crop 
provisions.
    Revenue guarantee--The guaranteed dollar amount on an insured unit. 
(See section 2 of the Crop Provisions.)
    Sales closing date--The date contained in the Special Provisions 
which is the final date when an application may be filed. This is the 
last date for you to make changes in your crop insurance coverage for 
the crop year.
    Section (for the purposes of unit structure)--A unit of measure 
under a rectangular survey system describing a tract of land usually 
one mile square and usually containing approximately 640 acres.
    Share--Your percentage of interest in the insured crop as an owner, 
operator, or tenant at the time insurance attaches. However, only for 
the purpose of determining the amount of indemnity, your share will not 
exceed your share at the earlier of the time of loss, or the beginning 
of harvest. Unless the accepted application clearly indicates that 
insurance is requested for a partnership or joint venture, or is 
intended to cover the landlord's, or tenant's share of the crop (see 
section 11(b)), insurance will cover only the share of the person 
completing the application. The share will not extend to any other 
person having an interest in the crop except as may otherwise be 
specifically allowed in this policy. We may consider any acreage or 
interest reported by or for your spouse, child or any member of your 
household to be included in your share. A lease containing provisions 
for both a minimum payment (such as a specified amount of cash , 
bushels, pounds, etc.,) and a crop share will be considered a crop 
share lease. A lease containing provisions for either a minimum payment 
or a crop share will be considered a cash lease.
    Special Provisions--The part of the policy that contains specific 
provisions of insurance for each insured crop that may vary by 
geographic area.
    State--The state shown on your accepted application.
    Summary of coverage--Our statement to you, based upon your acreage 
report, by unit, specifying the insured crop and the Revenue Guarantee.
    Tenant--A person who rents land from another person for a share of 
the crop or a share of the proceeds of the crop (see the definition of 
``Share'' in section 1).
    Termination date--The calendar date contained in the Crop 
Provisions upon which your policy ceases for nonpayment of premium or 
any other amount due us under the policy.
    Unit:
    (a) Basic unit--A basic unit is established in accordance with 
section 2 (a).
    (b) Optional unit--An optional unit is established from basic units 
in accordance with section 2(b).
    (c) Enterprise unit--An enterprise unit is established from basic 
units. An enterprise unit consists of all insurable acreage of corn or 
soybeans in the county in which you have a share on the date coverage 
begins for the crop year.
    (d) Whole-farm unit--A whole-farm unit is established from 
enterprise units. A whole-farm unit is all insurable acreage of corn 
and soybeans in the county in which you have a share on the date 
coverage begins for the crop year.

2. Unit Structure

    (a) Basic unit--All insurable acreage of the insured crop in the 
county on the date coverage begins for the crop year:
    (1) in which you have a 100 percent share; or
    (2) which is owned by one entity and operated by another specific 
entity on a share basis. (For example, if, in addition to the land you 
own, you rent land from five landlords, three on a crop share basis and 
two on a cash basis, you would be entitled to four units, one for each 
crop share lease and one for the two cash leases and the land you own). 
Land rented for cash, a fixed commodity payment, or a consideration 
other than a share in the insured crop on such land will be considered 
as owned by the lessee (see ``Share'' section 1).
    (b) Optional unit--Unless limited by the Special Provisions, a 
basic unit may be divided into optional units if, for each optional 
unit you meet all the conditions of this section. All optional units 
must be reflected on the acreage report for each crop year. There is a 
premium surcharge for optional units. The following requirements must 
be met for each optional unit:
    (1) You must have records, which can be independently verified, of 
planted acreage and production for each optional unit for at least the 
last crop year used to determine your Revenue Guarantee;
    (2) You must plant the crop in a manner that results in a clear and 
discernible break in the planting pattern at the boundaries of each 
optional unit;
    (3) You must have records of marketed production or measurement of

[[Page 33815]]

stored production from each optional unit maintained in such a manner 
that permits us to verify the production from each optional unit, or 
the production for each unit must be kept separate until after loss 
adjustment is completed; and
    (4) Each optional unit must meet one or more of the following 
criteria as applicable:
    (A) Optional Units by Section, Section Equivalent, or FSA Farm 
Serial Number: Optional units may be established if each optional unit 
is located in a separate legally identified section. In the absence of 
sections, we may consider parcels of land legally identified by other 
methods of measure including, but not limited to: Spanish grants, 
railroad surveys, leagues, labors, or Virginia Military Lands as the 
equivalent of sections for unit purposes. In areas which have not been 
surveyed using the systems identified above or another system approved 
by us, or in areas where such systems exist but boundaries are not 
readily discernable, each optional unit must be located in a separate 
farm identified by a single FSA farm serial number.
    (B) Optional Units on Acreage Including Both Irrigated and Non-
Irrigated Practices: In addition to, or instead of, establishing 
optional units by section, section equivalent, or FSA farm serial 
number, optional units may be based on irrigated acreage or non-
irrigated acreage if both are located in the same section, section 
equivalent, or FSA farm serial number. To qualify as separate irrigated 
and non-irrigated optional units, the non-irrigated acreage may not 
continue into the irrigated acreage in the same rows or planting 
pattern. The irrigated acreage may not extend beyond the point at which 
your irrigation system can deliver the quantity of water needed to 
produce the yield on which your Revenue Guarantee is based, except the 
corners of a field in which a center-pivot irrigation system is used 
will be considered as irrigated acreage if separate acceptable records 
of production from the corners are not provided. If the corners of a 
field in which a center-pivot irrigation system is used do not qualify 
as a separate non-irrigated optional unit, they will be a part of the 
unit containing the irrigated acreage. However, non-irrigated acreage 
that is not a part of a field in which a center-pivot irrigation system 
is used may qualify as a separate optional unit provided that all 
requirements of this section are met.
    (5) Basic units may not be divided into optional units on any basis 
(production practice, type, variety, planting period, etc.) other than 
as described under this section.
    (6) If you do not comply fully with these provisions, we will 
combine all optional units that are not in compliance with these 
provisions into the basic unit from which they were formed. We will 
combine the optional units at any time we discover that you have failed 
to comply with these provisions. If failure to comply with these 
provisions is determined to be inadvertent, and all the optional units 
are combined, the premium paid for the purpose of electing optional 
units will be refunded to you.
    (c) Enterprise unit--Selecting an enterprise unit entitles you to 
receive a discount on your basic unit premium.
    (d) Whole-farm unit--Selecting a whole-farm unit entitles you to 
receive a discount on your enterprise unit premium.
    (e) Exclusivity Between Units--If you select whole-farm unit 
coverage then you cannot select any other unit structure. You may 
select enterprise coverage for one crop and enterprise coverage for the 
other crop or basic and/or optional unit coverage for the other crop.

3. Life of Policy, Cancellation, and Termination

    (a) This policy will be in effect for the 1997 and 1998 crop years 
only. After acceptance of the application, you may not cancel this 
policy in the initial crop year. For the 1998 crop year, the policy 
will continue in force unless canceled or terminated as provided below.
    (b) Either you or we may cancel this policy after the initial crop 
year by providing written notice to the other on or before the 
cancellation and termination date of March 15.
    (c) All policies issued by us under the authority of the Act will 
terminate as of the coincidental or next termination date if any amount 
due us is not paid on or before the termination date for the crop on 
which the amount is due. Such unpaid debts will also make you 
ineligible for any crop insurance provided under the Act until payment 
is made. If we deduct any amount due us from an indemnity, the date of 
payment for the purpose of this paragraph will be the date you sign the 
properly completed claim for indemnity.
    (d) If you die, disappear, or are judicially declared incompetent, 
or if you are an entity other than an individual and such entity is 
dissolved, the policy will terminate as of the date of death, judicial 
declaration, or dissolution. If such event occurs after coverage begins 
for any crop year, the policy will continue in force through the crop 
year and terminate at the end of the insurance period and any indemnity 
will be paid to the person or persons determined to be beneficially 
entitled to the indemnity. Death of a partner in a partnership will 
dissolve the partnership unless the partnership agreement provides 
otherwise. If two or more persons having a joint interest are insured 
jointly, death of one of the persons will dissolve the joint entity.
    (e) You are not eligible to participate in the Revenue Assurance 
program if you are identified in the Non-Standard Classification 
system.
    (f) If you execute a High Risk Land Exclusion Option for a Revenue 
Assurance policy, you may elect to insure the ``high risk land'' under 
a Catastrophic Risk Protection Endorsement. If both policies are in 
force, the acreage of the crop covered under the Revenue Assurance 
policy and the acreage covered under the Catastrophic Risk Protection 
Endorsement will be considered as separate crops for insurance purposes 
including the payment of administrative fees.

4. Insurance Coverage

    (a) For each crop year, the revenue per acre will be determined for 
each insured unit as shown on your summary of coverage. The information 
necessary to determine those amounts will be contained in the premium 
calculator.
    (b) You may select only one coverage level offered by us for each 
insured crop. By written notice to us you may change the coverage level 
for the following crop year not later than the sales closing date for 
the affected insured crop. If you do not change the coverage level for 
the succeeding crop year you will be assigned the same coverage level 
that was in effect the previous crop year.
    (c) You must report production to us for the previous crop year by 
the earlier of the acreage reporting date or 45 days after the 
cancellation date. If you do not provide the required production 
report, we will assign a yield for the previous crop year. The yield 
assigned by us will not be more than 75 percent of the yield used by us 
to determine your coverage for the previous crop year. The production 
report or assigned yield will be used to compute your approved yield 
for the purpose of determining your coverage for the current crop year. 
If you have filed a claim for any crop year, the production used to 
determine the indemnity payment will be the production report for that 
year.
    (d) We may revise your Revenue Guarantee for any farm unit, and 
revise any indemnity paid based on that Revenue Guarantee, if we find 
that your

[[Page 33816]]

production report under section 4(c) above:
    (1) is not supported by written verifiable records; or
    (2) fails to accurately report actual production.

5. Contract Changes

    We may change the coverage under this policy from year to year. 
Your crop insurance agent will have changes in policy provisions, 
premium rate structures, and program dates by December 31. In addition, 
you will be notified, in writing, of these changes. Such notification 
will be made at least 30 days prior to the cancellation date of the 
insured crop.

6. Liberalization

    If we adopt any revisions which would broaden the coverage under 
this policy subsequent to the contract change date without additional 
premium, the broadened coverage will apply.

7. Report of Acreage

    (a) An annual acreage report must be submitted to us on our form 
for each insured crop in the county on or before the acreage reporting 
date shown in the Special Provisions. This report must include the 
following information, if applicable:
    (1) all acreage of the crop (insurable and not insured) in which 
you have a share;
    (2) quarter section, section, township, and range for each line 
item in each unit;
    (3) your share at the time coverage begins;
    (4) the practice;
    (5) the type; and
    (6) the date the insured crop was planted.
    (b) If you do not have a share in any insured crop in the county 
for the crop year, you must submit an acreage report so indicating.
    (c) Because incorrect reporting on the acreage report may have the 
effect of changing your premium and any indemnity which may be due, you 
may not revise this report after the acreage reporting date without our 
consent.
    (d) We may elect to determine all premiums and indemnities based on 
the information you submit on the acreage report or upon the factual 
circumstances which we determine to have actually existed.
    (e) If you do not submit an acreage report by the acreage reporting 
date, or if you fail to report all units, we may elect to determine by 
unit the insurable crop acreage, share, type and practice or deny 
liability on any unit.
    (f) If the information reported by you on the acreage report for a 
unit results in a lower premium than the actual premium determined to 
be due on the basis of the share, acreage, practice, type or other 
material information determined to actually exist, the Revenue 
Guarantee on the unit will be reduced proportionately. In the event 
that acreage is under-reported, all production from insurable acreage 
for the unit, whether or not reported as insurable, will be considered 
production to count in determining the indemnity.
    (g) Errors in reporting units may be corrected by us to reduce our 
liability and to conform to applicable unit division guidelines at the 
time of adjusting a loss.

8. Annual Premium

    (a) The annual premium is earned and payable at the time coverage 
begins. You will be billed for premium due not earlier than the billing 
date specified in the Special Provisions. The premium due, plus any 
accrued interest, will be considered delinquent if any amount due us is 
not paid on or before the termination date.
    (b) Any amount due us will be deducted from any replant payment or 
indemnity due you under the provisions of this policy.
    (c) The annual premium is determined by multiplying the number of 
insured acres on each unit times the applicable per acre premium, times 
any applicable discount factor for enterprise unit coverage or whole-
farm unit coverage, or any applicable surcharge factor for optional 
unit coverage, times the premium subsidy factor.
    (1) See section 3 of the Crop Provisions for the applicable 
discount or surcharge factors.
    (2) The per acre premium for a basic unit is calculated by the 
premium calculator. The premium subsidy factor depends upon the 
coverage level. The premium subsidy factor is given by the following 
equation: premium subsidy factor = 1 - (2.965 - (.0574 x CLP) + 
(.00028 x CLP \2\)). CLP is expressed as a percent (xx.xx) in this 
formula. The premium subsidy will not exceed that which is available 
under a comparable MPCI policy.

9. Insured Crop

    (a) The insured crop will be that shown on your accepted 
application and as specified in the Crop Provisions and must be grown 
on insurable acreage.
    (b) A crop which will NOT be insured will include, but will not be 
limited to, any crop:
    (1) if the farming practices carried out are not in accordance with 
the farming practices for which the premium rates and revenue 
guarantees have been established;
    (2) of a type, class or variety established as not adapted to the 
area or excluded by the Special Provisions;
    (3) that is a volunteer crop;
    (4) that is a second crop following the same crop (insured or not 
insured) harvested in the same crop year unless specifically permitted 
by the Crop Provisions or the Special Provisions;
    (5) which is planted for the development or production of hybrid 
seed or for experimental purposes, unless permitted by the Crop 
Provisions; or
    (6) used for wildlife protection or management.

10. Insurable Acreage

    (a) Acreage planted to the insured crop in which you have a share 
is insurable unless it is acreage:
    (1) on which a crop has not been planted or harvested in at least 
one of the three previous crop years, unless FSA classifies such 
acreage as cropland;
    (2) which has been strip-mined;
    (3) on which the insured crop is damaged and it is practical to 
replant the insured crop, but the insured crop is not replanted;
    (4) which is planted with a crop other than the insured crop, 
unless allowed by the Crop Provisions; or
    (5) which is otherwise restricted by the Crop Provisions or Special 
Provisions.
    (b) If insurance is provided for an irrigated practice, you must 
report as irrigated only that acreage for which you have adequate 
facilities and water, at the time coverage begins, to carry out a good 
irrigation practice.
    (c) If acreage is irrigated and we do not provide a premium rate 
for an irrigated practice, you may either report and insure the 
irrigated acreage as ``nonirrigated,'' or report the irrigated acreage 
as not insured.
    (d) We may restrict the amount of acreage which we will insure to 
the amount allowed under any acreage limitation program established by 
the United States Department of Agriculture if we notify you of that 
restriction prior to the sales closing date.

11. Share Insured

    (a) You may only insure your share (see definition of share in 
section 1).
    (b) You as a landlord (or tenant) may insure your tenant's (or 
landlord's) share of the crop if evidence of the other party's approval 
of that insurance is demonstrated (Lease, Power of Attorney,

[[Page 33817]]

etc.). The respective shares must be clearly set out on the acreage 
report and a copy of the other party's approval must be retained by us.

12. Insurance Period

    Coverage begins the later of; the date you submit your application, 
when the insured crop is planted, or on the calendar date for the 
beginning of the insurance period if specified in the Crop Provisions, 
and ends at the earliest of:
    (a) total destruction of the insured crop on the unit;
    (b) harvest of the unit;
    (c) final adjustment of a loss on a unit;
    (d) the calendar date for the end of the insurance period contained 
in the Crop Provisions;
    (e) abandonment of the crop on the unit; or
    (f) as otherwise specified in the Crop Provisions.

13. Causes of Loss

    The insurance provided is against only unavoidable loss of revenue 
directly caused by specific causes of loss contained in the Crop 
Provisions. All other causes of loss, including but not limited to the 
following, are NOT covered:
    (a) negligence, mismanagement, or wrongdoing by you, any member of 
your family or household, your tenants, or employees;
    (b) the failure to follow recognized good farming practices for the 
insured crop;
    (c) water contained by any governmental, public, or private dam or 
reservoir project;
    (d) failure or breakdown of irrigation equipment or facilities; or
    (e) failure to carry out a good irrigation practice for the insured 
crop if applicable.

14. Replanting Payment

    (a) If allowed by the Crop Provisions, a replanting payment may be 
made on an insured crop replanted after we have given consent and the 
acreage replanted is at least the lesser of 20 acres or 20 percent of 
the insured acreage for the unit (as determined on the final planting 
date). The 20 acres or 20 percent requirement is to be applied for each 
crop in a whole farm unit.
    (b) No replanting payment will be made on acreage:
    (1) on which our appraisal establishes that revenue will exceed 90 
percent of the Revenue Guarantee, set by the Crop Provisions, divided 
by your share;
    (2) initially planted prior to the date established by the Special 
Provisions; or
    (3) on which one replanting payment has already been allowed for 
the crop year.
    (c) The replanting payment per acre will be your actual cost for 
replanting, but will not exceed the amount determined in accordance 
with the Crop Provisions.
    (d) If the information reported by you on the acreage report 
results in a lower premium than the actual premium determined to be due 
based on the acreage, share, practice, or type determined actually to 
have existed, the replanting payment will be reduced proportionately.
    (e) No replanting payment will be paid for replanting any crop if 
we determine it is not practical to replant (see section 1).

15. Duties in the Event of Damage or Loss

    Your Duties:
    (a) In case of damage to any insured crop or loss of revenue you 
must:
    (1) protect the crop from further damage by providing sufficient 
care;
    (2) give us notice within 72 hours of your initial discovery of 
damage (but not later than 15 days after the end of the insurance 
period), by unit, for each insured crop;
    (3) leave representative samples intact for each field of the 
damaged unit as may be required by the Crop Provisions; and
    (4) give us notice of expected revenue loss not later than 45 days 
after the date the county harvest price is published if your production 
multiplied by the county harvest price is less than the revenue 
guarantee.
    (b) You must obtain consent from us before, and notify us after 
you:
    (1) destroy any of the insured crop which is not harvested;
    (2) put the insured crop to an alternative use;
    (3) put the acreage to another use; or
    (4) abandon any portion of the insured crop.
    We will not give such consent if it is practical to replant the 
crop or until we have made an appraisal of the potential production of 
the crop.
    (c) In addition to complying with all other notice requirements, 
you must submit a claim for indemnity declaring the amount of your loss 
not later than 60 days after the end of the insurance period. This 
claim must include all the information we require to settle the claim.
    (d) Upon our request, you must:
    (1) provide a complete harvesting and marketing record of each 
insured crop by unit including separate records showing the same 
information for production from any acreage not insured; and
    (2) submit to examination under oath.
    (e) You must establish the total production for the insured crop on 
the unit and that any loss of production has been directly caused by 
one or more of the insured causes (see Crop Provisions) during the 
insurance period.
    (f) All notices required in this section that must be received by 
us within 72 hours may be made by telephone or in person to your crop 
insurance agent but must be confirmed in writing within 15 days.
    Our Duties:
    (a) If you have complied with all the policy provisions we will pay 
your loss within 30 days after:
    (1) we reach agreement with you; or
    (2) the entry of a final judgment by a court of competent 
jurisdiction.
    (b) In the event we are unable to pay your loss within 30 days, we 
will give you notice of our intentions within the 30 day period.
    (c) We may defer the adjustment of a loss until the amount of loss 
can be accurately determined. We will not pay for additional damage 
resulting from your failure to provide sufficient care for the crop 
during the deferral period.
    (d) We recognize and apply the MPCI loss adjustment procedures 
established or approved by the FCIC to determine production to count.

16. Production Included in Determining Indemnities

    (a) The total production to be counted for a unit will include all 
production determined in accordance with the Crop Provisions.
    (b) The amount of production of any unharvested insured crop may be 
determined on the basis of our field appraisals conducted after the end 
of the insurance period.

17. Crops as Payment

    You must not abandon any crop to us. We will not accept any crop as 
compensation for payments due us.

18. Arbitration

    If you and we fail to agree on any factual determination, 
disagreement will be resolved in accordance with the rules of the 
American Arbitration Association. Failure to agree with any factual 
determination made by Federal Crop Insurance Corporation must be 
resolved pursuant to 7 CFR part 11.

19. Access to Insured Crop and Record Retention

    (a) We reserve the right to examine the insured crop as often as we 
reasonably require.
    (b) For three years after the end of the crop year, you must 
retain, and provide upon our request, complete records of

[[Page 33818]]

the harvesting, storage, shipment, sale, or other disposition of all 
the insured crop produced on each unit. This requirement also applies 
to the records used to establish the basis for the production report 
for each unit. You must also upon our request, provide separate records 
showing the same information for production from any acreage not 
insured. We may extend the record retention period beyond three years 
by notifying you of such extension in writing. Your failure to keep and 
maintain such records may, at our option, result in:
    (1) cancellation of the policy;
    (2) assignment of production to units by us; or
    (3) a determination that no indemnity is due.
    (c) Any person designated by us will, at any time during the record 
retention period, have access:
    (1) to any records relating to this insurance at any location where 
such records may be found or maintained; and
    (2) to the farm.
    (d) By applying for insurance under the Act, or by continuing 
insurance previously applied for, you authorize us, or any person 
acting for us, to obtain records relating to the insured crop from any 
person who may have custody of those records including, but not limited 
to, county FSA offices, banks, warehouses, gins, cooperatives, 
marketing associations, accountants, etc. You must assist us in 
obtaining all records which we request from third parties.
    (e) This policy will be considered a continuation of any prior MPCI 
policy for actual production history purposes under 7 CFR part 400, 
subpart G. You need not resubmit production reports provided under the 
former policy.

20. Other Insurance

    (a) Other Like Insurance.
    You must not obtain any other crop insurance issued under the 
authority of the Act, on your share of the insured crop. If we 
determine that more than one policy on your share is intentional, you 
may be subject to the fraud provisions under this policy. If we 
determine that the violation was not intentional, the policy with the 
earliest date of application will be in force and all other policies 
will be void. Nothing in this section prevents you from obtaining other 
insurance not issued under the Act.
    (b) Other Insurance Against Fire.
    If you have other insurance, whether valid or not, against damage 
to the insured crop by fire during the insurance period we will be 
liable for loss for the smaller of:
    (1) the amount of indemnity determined pursuant to this policy 
without regard to any other insurance; or
    (2) the amount by which the loss is determined to exceed the 
indemnity paid or payable under such other insurance. For the purpose 
of this section, the amount of loss will be the reduction in revenue of 
the insured crop on the unit involved determined pursuant this policy.

21. Conformity to Food Security Act

    Although your violation of a number of federal statutes, including 
the Act, may cause cancellation, termination, or voidance of your 
insurance contract, you should be aware that your policy will be 
canceled if you are determined to be ineligible to receive benefits 
under the Act, due to violation of the Controlled Substance Provision 
(title XVII) of the Food Security Act of 1985 (Pub. L. 99-198) and the 
regulations promulgated under the Act by the United States Department 
of Agriculture. Your insurance policy will be canceled if you are 
determined, by the appropriate United States Government Agency, to be 
in violation of these provisions. We will recover any and all monies 
paid to you or received by you and your premium will be refunded less a 
reasonable amount for expenses and handling not to exceed 20 percent of 
the premium paid.

22. Amounts Due Us

    (a) Interest will accrue at the rate of 1.25 percent simple 
interest per calendar month, or any part thereof, on any unpaid amount 
due us. For the purpose of premium amounts due us, interest will start 
on the first day of the month following the premium billing date 
specified in the Special Provisions.
    (b) For the purpose of any other amounts due us, such as repayment 
of indemnities found not to have been earned, interest will start on 
the date that notice is issued to you for the collection of the 
unearned amount. Amounts found due under this section will not be 
charged interest if payment is made within 30 days of issuance of the 
notice by us. The amount will be considered delinquent if not paid 
within 30 days of the date the notice is issued by us.
    (c) All amounts paid will be applied first to expenses of 
collection, if any (see section 22(d)), second, to the reduction of 
accrued interest, and then to the principal balance.
    (d) 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. Those expenses will be 
paid before the application of any amounts to interest or principal.

23. Legal Action Against Us

    (a) You may not bring legal action against us unless you have 
complied with all of the policy provisions.
    (b) Your right to recover damages (compensatory, punitive, or 
other), attorney's fees, or other charges is limited or excluded by 
this contract or by Federal Regulations.

24. Payment and Interest Limitations

    (a) 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 claim.
    (b) We will pay simple interest computed on the net indemnity 
ultimately found to be due by us or by a final judgment of a court of 
competent jurisdiction, from and including the 61st day after the date 
you sign, date, and submit to us the properly completed claim on our 
form. 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 semiannually on or about January 
1 and July 1 of each year and may vary with each publication.

25. Concealment, Misrepresentation or Fraud

    This policy will be void in the event you have falsely or 
fraudulently concealed either the fact that you are restricted from 
receiving benefits under the Act, or that action is pending which may 
restrict your eligibility to receive such benefits. We will also void 
this policy if you or anyone assisting you has intentionally concealed 
or misrepresented any material fact relating to this or any other 
Federal Crop Insurance Corporation policy or reinsured policy. This 
voidance will not affect your obligation to pay premiums or waive any 
of our rights under this policy, including the right to collect any 
amount due us. The voidance will be effective as of the time coverage 
began for the crop year within which such act occurred.

[[Page 33819]]

26. Transfer of Coverage and Right To Indemnity

    If you transfer any part of your share during the crop year, you 
may transfer your coverage rights. The transfer must be on our form and 
approved by us. Both you and the person to whom you transfer your 
interest are jointly and severally liable for the payment of the 
premium. The transferee has all rights and responsibilities under this 
policy consistent with the transferee's interest.

27. Assignment of Indemnity

    You may assign to another party your right to an indemnity for the 
crop year. The assignment must be on our form and will not be effective 
until approved in writing by us. The assignee will have the right to 
submit all loss notices and forms as required by the policy.

28. Subrogation (Recovery of Loss From a Third Party)

    Because you may be able to recover all or a part of your loss from 
someone other than us, you must do all you can to preserve this right. 
If we pay you for your loss, your right to recovery will, at our 
option, belong to us. If we recover more than we paid you plus our 
expenses, the excess will be paid to you.

29. Descriptive Headings

    The descriptive headings of the various policy provisions are 
formulated for convenience only and are not intended to affect the 
construction or meaning of any of the policy provisions.

30. Notices

    All notices required to be given by you must be in writing and 
received by your crop insurance agent within the designated time unless 
otherwise provided by the notice requirement. Notices required to be 
given immediately may be by telephone or in person and confirmed in 
writing. Time of the notice will be determined by the time of our 
receipt of the written notice. If the date by which you are required to 
submit a report or notice falls on Saturday, Sunday, or a Federal 
holiday, or, if your agent's office is, for any reason, not open for 
business on the date you are required to submit such notice or report, 
such notice or report must be submitted on the next business day. All 
notices and communications required to be sent by us to you will be 
mailed to the address contained in your records located with your Crop 
Insurance Agent. You should advise us immediately of any change of 
address.

Revenue Assurance--Corn and Soybean Crop Provisions

    This is a pilot risk management program. This risk management tool 
will be reinsured under the authority provided by the Federal Crop 
Insurance Act as amended.

1. Definitions

    County harvest price--The price used to value production to count. 
It is the simple average of the daily posted county prices as published 
by USDA for each county. For corn, the county harvest price is the 
average of the daily posted county prices for corn in November of the 
crop year. For soybeans, the county harvest price is the average of the 
daily posted county prices for soybeans in October. The county harvest 
price will be calculated by FCIC by November 5 for soybeans and 
December 5 for corn.
    Expected per-acre revenue--The approved APH yield times the 
projected county price.
    Final planting date--The date contained in the Special Provisions 
for the insured crop by which the crop must initially be planted in 
order to be insured for the full unit revenue guarantee.
    Good farming practices--The cultural practices generally in use in 
the county for the insured crop to make normal progress toward maturity 
and produce at least the yield used to determine the expected per-acre 
revenue, and are those recognized by the Cooperative State Research, 
Education, and Extension Service as compatible with agronomic and 
weather conditions in the area.
    Harvest--Combining, threshing, or picking the insured crop for 
grain.
    Interplanted--Acreage on which two or more crops are planted in a 
manner that does not permit separate agronomic maintenance or harvest 
of the insured crop.
    Irrigated practice--A method of producing a crop by which water is 
artificially applied during the growing season by appropriate systems, 
and at the proper times, with the intention of providing the quantity 
of water needed to produce at least the yield used to establish the 
irrigated unit revenue guarantee on the irrigated acreage planted to 
the insured crop.
    Late planted--Acreage planted to the insured crop during the late 
planting period.
    Late planting period--The period that begins the day after the 
final planting date for the insured crop and ends twenty-five (25) days 
after the final planting date.
    Maximum per-acre revenue guarantee--The expected per-acre revenue 
times the coverage level percent (.7500).
    Minimum per-acre revenue guarantee--The expected per-acre revenue 
times the coverage level percent (.6500).
    Planted acreage--Land in which seed has been placed by a machine 
appropriate for the insured crop and planting method, at the correct 
depth, into a seedbed which has been properly prepared for the planting 
method and production practice. The crop must initially be planted in 
rows to be considered planted. Corn must be planted in rows far enough 
apart to permit mechanical cultivation. Planting in any other manner 
will be considered as a failure to follow recognized good farming 
practices and any loss of production will not be insured unless 
otherwise provided by the Special Provisions.
    Prevented planting--Inability to plant the insured crop with proper 
equipment by the final planting date designated in the Special 
Provisions for the insured crop in the county or the end of the late 
planting period. You must have been unable to plant the insured crop 
due to an insured cause of loss that has prevented the majority of 
producers in the surrounding area from planting the same crop.
    Prevented planting guarantee--The prevented planting guarantee for 
such acreage will be that percentage of the unit revenue guarantee for 
timely planted acres as set forth in section 11(d).
    Projected county price--The price used to determine the unit 
revenue guarantee. Projected county prices represent our best 
projections--before planting--of the county harvest prices for corn and 
soybeans (see section 1). The first step in making these projections is 
to calculate the simple average of the final closing daily settlement 
prices in February on the Chicago Board of Trade (CBOT) December corn 
futures contract and November soybean futures contract for the current 
crop year. Projected county prices are found by subtracting county-
specific adjustment factors from these average February CBOT prices. 
County adjustment factors reflect the historical difference between 
county harvest prices and CBOT futures prices in the harvest month. The 
county adjustment factors are known and fixed in January before 
planting. For corn, the county adjustment factor is the historical 
difference between county harvest prices for corn and the simple 
average of the final daily settlement prices in

[[Page 33820]]

November on the CBOT December corn futures contract. For soybeans, the 
county adjustment factor is the historical difference between county 
harvest prices for soybeans and the simple average of the final daily 
settlement prices in October on the November soybeans futures contract. 
The projected county prices will be calculated by FCIC by March 5 of 
the current crop year. The projected county prices for corn and 
soybeans in Pottawattamie County are the simple averages of the 
respective projected county prices for East and West Pottawattamie.
    Replanting--Performing the cultural practices necessary to replace 
the seed of the same insured crop, and replacing the seed for the same 
crop in the insured acreage with the expectation of growing a 
successful crop.
    Selected per-acre revenue guarantee--The per-acre dollar amount of 
revenue protection you select. This amount of revenue protection cannot 
be less than the minimum per-acre revenue guarantee nor more than the 
maximum per-acre revenue guarantee.
    Silage--A product that results from severing the plant from the 
land and chopping it for the purpose of livestock feed.
    Timely planted--Planted on or before the final planting date 
designated in the Special Provisions for the insured crop in the 
county.
    Unit revenue guarantee--The selected per-acre revenue guarantee, 
times the number of insured acres on the unit, times your share.

2. Revenue Guarantee

    The unit revenue guarantee is determined using the following 
procedures for the different types of units. All information needed to 
calculate the applicable unit revenue guarantee is obtained from the 
premium calculator.
    (a) Basic and optional unit revenue guarantee: A unit revenue 
guarantee (see section 1) is computed for each basic and optional unit. 
The coverage level (see section 1 of the Basic Provisions) for each 
crop unit must be the same.
    (b) Enterprise unit revenue guarantee: For a corn enterprise unit, 
total the revenue guarantees for corn as if basic units and /or 
optional units had been selected in a county. For a soybean enterprise 
unit, total the revenue guarantees for soybeans as if basic and/or 
optional units had been selected in a county.
    (c) Whole-farm unit revenue guarantee: Total the revenue guarantees 
for both corn and soybeans as if enterprise units had been selected in 
a county. Only one coverage level (see section 1 of the Basic 
Provisions) can be selected for the whole-farm unit.

3. Annual Premium

    The annual premium on a unit is determined using the following 
procedures for the different types of units. All information needed to 
calculate per-acre premiums are obtained from the premium calculator. 
The annual premium you pay equals the annual premium, times the premium 
subsidy factor (see section 8(c)(2) of the Basic Provisions).
    (a) Basic units: The per-acre premium on a basic unit is found 
using the premium calculator. The annual premium for a basic unit 
equals the per-acre premium, times the number of insured acres on the 
unit, times your share.
    (b) Optional units: The per-acre premium for an optional unit 
equals the premium from the premium calculator, times an optional unit 
surcharge factor. The optional unit surcharge factor equals 1.22 for 
corn and 1.30 for soybeans. The annual premium for an optional unit 
equals the per-acre premium for the optional unit, times the number of 
insured acres on the optional unit, times your share.
    (c) Enterprise units: The annual premium for a corn enterprise unit 
is found by totaling the annual premiums for corn as if basic and/or 
optional units had been selected in a county, and then multiplying the 
total by the corn enterprise discount factor. The annual premium for a 
soybean enterprise unit is found by totaling the annual premiums for 
soybeans as if basic and/or optional units had been selected in a 
county, and then multiplying the total by the soybean enterprise 
discount factor. The corn and soybean enterprise discount factors vary 
with the number of legally defined sections on which the basic units 
reside. The enterprise unit discount factors are:

------------------------------------------------------------------------
                                                    Corn       Soybeans 
              Number of sections                  discount     discount 
                                                   factor       factor  
------------------------------------------------------------------------
1.............................................         1.00         1.00
2.............................................         0.85         0.76
3.............................................         0.81         0.69
4.............................................         0.79         0.65
5.............................................        0.775         0.61
6.............................................         0.76         0.59
7.............................................         0.75         0.58
8.............................................        0.745         0.57
9 or more.....................................         0.74         0.56
------------------------------------------------------------------------

    (d) Whole-farm units: The annual premium on a whole-farm unit 
equals the sum of the annual premiums for corn and soybeans as if 
enterprise units had been selected in a county, times the whole-farm 
discount factor. The whole-farm discount factor varies with the ratio 
of the total number of planted corn acres to the total number of 
planted corn acres and planted soybean acres in a county, rounded to 
the nearest tenth. The whole-farm unit discount factors are:

------------------------------------------------------------------------
                                                            Whole-farm  
 Ratio of planted corn acres to planted corn acres plus      discount   
                  planted soybean acres                       factor    
------------------------------------------------------------------------
0.0.....................................................            1.00
0.1.....................................................            0.92
0.2.....................................................            0.86
0.3.....................................................            0.82
0.4.....................................................            0.80
0.5.....................................................            0.80
0.6.....................................................            0.82
0.7.....................................................            0.85
0.8.....................................................            0.89
0.9.....................................................            0.94
1.0.....................................................            1.00
------------------------------------------------------------------------

4. Insured Crop

    (a) Corn--In accordance with section 9 (Insured Crop) of the Basic 
Provisions, the crop insured will be corn for which premiums are 
provided by the premium calculator:
    (1) In which you have a share;
    (2) That is adapted to the area based on days to maturity and is 
compatible with agronomic and weather conditions in the area;
    (3) That is not (unless allowed by the Special Provisions):
    (i) Interplanted with another crop; or
    (ii) Planted into an established grass or legume; and
    (4) That is planted for harvest as grain.
    (b) In addition to the provisions of section 4(a), the corn crop 
insured will be all corn that is yellow dent or white corn, including 
mixed yellow and white, waxy, high-lysine corn, high-oil corn blends 
containing mixtures of at least ninety percent high yielding yellow 
dent female plants with high-oil male pollinator plants, commercial 
varieties of high-protein hybrids, and excluding:
    (1) High-amylose, high-oil except as defined in section 4(b), 
flint, flour, Indian, or blue corn, or a variety genetically adapted to 
provide forage for wildlife or any other open pollinated corn.
    (2) A variety of corn adapted for silage use when the corn is 
reported for insurance as grain.
    (c) Soybeans--In accordance with section 9 (Insured Crop) of the 
Basic Provisions, the crop insured will be the soybean crop you elect 
to insure for which premiums are provided by the premium calculator:

[[Page 33821]]

    (1) In which you have a share;
    (2) That are adapted to the area based on days to maturity and is 
compatible with agronomic and weather conditions in the area; and
    (3) That are not:
    (i) Interplanted with another crop; and
    (ii) Planted into an established grass or legume; and
    (4) That are planted for harvest as beans.

5. Insurable Acreage

    In addition to the provisions of section 10 (Insurable Acreage) of 
the Basic Provisions, any acreage of the insured crop damaged before 
the final planting date, to the extent that the remaining stand will 
not produce at least 90 percent of an amount equal to the unit revenue 
guarantee divided by your share on the unit must be replanted unless we 
agree that replanting is not practical (see section 1). The price used 
to determine if 90 percent of the unit revenue guarantee can be 
achieved is the projected county price.

6. Insurance Period

    In accordance with the provisions under section 12 (Insurance 
Period) of the Basic Provisions, the calendar date for the end of the 
insurance period is the December 10 immediately following planting.

7. Causes of Loss

    Insurance is provided only against an unavoidable loss of revenue 
due to the following causes of loss which occur within the insurance 
period:
    (a) Adverse weather conditions;
    (b) Fire;
    (c) Insects, but not damage due to insufficient or improper 
application of pest control measures;
    (d) Plant disease, but not damage due to insufficient or improper 
application of disease control measures;
    (e) Wildlife;
    (f) Earthquake;
    (g) Failure of the irrigation water supply, if applicable, due to 
an unavoidable cause of loss occurring within the insurance period; or
    (h) A decline in the county harvest price below the projected 
county price.

8. Replanting Payments

    (a) In accordance with section 14 (Replanting Payment) of the Basic 
Provisions, a replanting payment is allowed if the insured crop(s) on a 
unit was damaged by an insurable cause of loss to the extent that the 
remaining stand will not produce at least 90 percent of the unit 
revenue guarantee divided by your share on the unit and it is practical 
to replant (see section 1).
    (b) The maximum amount of the replanting payment per acre will be 
the lesser of 20 percent of the unit revenue guarantee divided by the 
number of insured acres on the unit or, for corn, an amount found by 
multiplying 8 bushels, times projected county price, times your share, 
or for soybeans, an amount equal to 3 bushels for soybeans, times 
projected county price, times your share.
    (c) When more than one person insures the same crop on a share 
basis, a replanting payment based on the total shares insured by us may 
be made to the insured person who incurs the total cost of replanting. 
Payment will be made in this manner only if an agreement exists between 
the insured persons which:
    (1) Requires one person to incur the entire cost of replanting; or
    (2) Gives the right to all replanting payments to one person
    (d) When the insured crop is replanted using a practice that is 
uninsurable as an original planting, the unit revenue guarantee will be 
reduced by the amount of the replanting payment which is attributable 
to your share. The premium amount will not be reduced.

9. Duties in the Event of Damage or Loss

    In accordance with the requirements of section 15 (Duties in the 
Event of Damage or Loss) of the Basic Provisions, if you initially 
discover damage to any insured crop within 15 days of or during 
harvest, you must leave representative samples of the unharvested crop 
for our inspection. The samples must be at least 10 feet wide and 
extend the entire length of each field, and must not be harvested or 
destroyed until the earlier of our inspection or 15 days after harvest 
is completed.

10. Settlement of Claim

    (a) We will determine your loss on a unit basis. In the event you 
are unable to provide records of production:
    (1) For any optional unit, we will combine all optional units for 
which acceptable records of production were not provided: or
    (2) For any basic unit, we will allocate any commingled production 
to such units in proportion to our liability on the harvested acreage 
for each unit.
    (b) In the event of loss or damage covered by this policy, we will 
settle your claim using the following procedures:
    (1) Basic and Optional units: We will settle your claim on each 
basic or optional unit by:
    (i) Multiplying the applicable county harvest price times the 
production to count on each unit (see section 10(c-e) below), times 
your share; and
    (ii) Subtracting the result of section 10(b)(1)(i) from each unit 
revenue guarantee.
    If the result of section 10(b)(1)(ii) is greater than zero, an 
indemnity equal to the result of section 10(b)(1)(ii) will be paid to 
you. If the result of section 10(b)(1)(ii) is less than or equal to 
zero, no indemnity will be paid.
    (2) Enterprise units: We will settle your claim on an enterprise 
unit as follows:
    (i) Multiplying the applicable crop county harvest price, times 
applicable crop production to count as if basic and/or optional units 
had been selected in a county, times your share;
    (ii) Totaling the results of section 10(b)(2)(i); and
    (iii) Subtracting the result of section 10(b)(2)(ii) from the 
enterprise unit revenue guarantee.
    If the result of section 10(b)(2)(iii) is greater than zero, an 
indemnity equal to the result of section 10(b)(2)(iii) will be paid to 
you. If the result of section 10(b)(2)(iii) is less than or equal to 
zero, no indemnity will be paid. Under enterprise coverage you may not 
be eligible for an indemnity even if one of your basic units has a loss 
of revenue.
    (3) Whole-farm units: We will settle your claim on a whole-farm 
unit as follows:
    (i) For all corn in a county and for all soybeans in a county, 
multiply the applicable crop county harvest price, times applicable 
crop production to count as if enterprise units had been selected in a 
county, times your share;
    (ii) Total the results of section 10(b)(3)(i) for all (corn and 
soybeans); and
    (iii) Subtract the result of section 10(b)(3)(ii) from the whole-
farm unit revenue guarantee.
    If the result of section 10(b)(3)(iii) is greater than zero, an 
indemnity equal to the result of section 10(b)(3)(iii) will be paid to 
you. If the result of section 10(b)(3)(iii) is less than or equal to 
zero, no indemnity will be paid. Under whole-farm coverage you may not 
be eligible for an indemnity even if one (or more) of your basic units 
has a revenue loss.
    (c) The total production to count in bushels from all insurable 
acreage on the unit will include:
    (1) All appraised production as follows:
    (i) Not less than the selected per-acre revenue guarantee (approved 
yield, times the coverage level, times the

[[Page 33822]]

projected county price) will be used for such acreage:
    (A) That is abandoned;
    (B) Put to another use without our consent;
    (C) Damaged solely by uninsured causes; or
    (D) For which you fail to provide records of production that are 
acceptable to us;
    (ii) Production lost due to uninsured causes;
    (iii) Unharvested production (mature unharvested production may be 
adjusted for quality deficiencies and excess moisture in accordance 
with section 10(d)); and
    (iv) Potential production on insured acreage you want to put to 
another use or you wish to abandon and no longer care for, if you and 
we agree on the appraised amount of production. Upon such agreement the 
insurance period for that acreage will end if you put the acreage to 
another use or abandon the crop. If agreement on the appraised amount 
of production is not reached:
    (A) If you do not elect to continue to care for the crop we may 
give you consent to put the acreage to another use if you agree to 
leave intact, and provide sufficient care for, representative samples 
of the crop in locations acceptable to us (The amount of production to 
count for such acreage will be based on the harvested production or 
appraisals from the samples at the time harvest should have occurred. 
If you do not leave the required samples intact, or you fail to provide 
sufficient care for the samples, our appraisal made prior to giving you 
consent to put the acreage to another use will be used to determine the 
amount of production to count.); or
    (B) If you elect to continue to care for the crop, the amount of 
production to count for the acreage will be the harvested production, 
or our reappraisal if additional damage occurs and the crop is not 
harvested; and
    (2) All harvested production from the insurable acreage.
    (d) Mature crop production (excluding silage type or corn insured 
or harvested as silage) may be adjusted for excess moisture and quality 
deficiencies. If moisture adjustment is applicable it will be made 
prior to any adjustment for quality.
    (1) Production will be reduced by 0.12 percent for each 0.1 percent 
age point of moisture in excess of:
    (i) Fifteen percent for corn (If moisture exceeds 30 percent, 
production will be reduced 0.2 percent for each 0.1 percentage point 
above 30 percent; and
    (ii) Thirteen percent for soybeans.
    We may obtain samples of the production to determine the moisture 
content.
    (2) Production will be eligible for quality adjustment if:
    (i) Deficiencies in quality, in accordance with the Official United 
States Standards for Grain, result in:
    (A) Corn not meeting the grade requirements for U.S. No. 4 (grades 
U.S. No. 5 or worse) because of test weight or kernel damage (excluding 
heat damage) or having a musty, sour, or commercially objectionable 
foreign odor; or
    (B) Soybeans not meeting the grade requirements for U.S. No. 4 
(grades U.S. Sample grade) because of test weight or kernel damage 
(excluding heat damage) or having a musty, sour, or commercially 
objectionable foreign odor (except garlic odor), or which meet the 
special grade requirements for garlicky soybeans; or
    (ii) Substances or conditions are present that are identified by 
the Food and Drug Administration or other public health organizations 
of the United States as being injurious to human or animal health.
    (3) Quality will be a factor in determining your loss only if:
    (i) The deficiencies, substances, or conditions resulted from a 
cause of loss against which insurance is provided under these crop 
provisions;
    (ii) All determinations of these deficiencies, substances, or 
conditions are made using samples of the production obtained by us or 
by a disinterested third party approved by us; and
    (iii) The samples are analyzed by a grader licensed under the 
authority of the United States Grain Standards Act or the United States 
Warehouse Act with regard to deficiencies in quality, or by a 
laboratory approved by us with regard to substances or conditions 
injurious to human or animal health. (Test weight for quality 
adjustment purposes may be determined by our loss adjuster.)
    (4) The crop grain production that is eligible for quality 
adjustment, as specified in sections 10(d) (2) and (3), will be reduced 
by the quality adjustment factor contained in the Special Provisions.
    (e) Any production harvested from plants growing in the insured 
crop may be counted as production of the insured crop on a weight 
basis.

11. Late Planting and Prevented Planting

    (a) Insurance will be provided for acreage planted to the insured 
crop during the late planting period (see section 11(c)), and acreage 
you were prevented from planting (see section 11(d)). These coverages 
provide reduced amounts of protection. The reduced guarantees will be 
combined with the unit revenue guarantee for timely planted acreage. 
The premium amount for late planted acreage and eligible prevented 
planting acreage will be the same as that for timely planted acreage. 
If the amount of premium you are required to pay for late planted 
acreage or prevented planting acreage exceeds the liability on such 
acreage, coverage for those acres will not be provided (no premium will 
be due and no indemnity will be paid for such acreage). For example, 
assume you insure one unit in which you have a 100 percent share. The 
unit consists of 150 acres, of which 50 acres were planted timely, 50 
acres were planted 7 days after the final planting date (late planted), 
and 50 acres are unplanted and eligible for prevented planting 
coverage. To calculate the amount of any indemnity which may be due to 
you, the unit revenue guarantee for the unit will be computed as 
follows:
    (1) For timely planted acreage, multiply the unit revenue guarantee 
for timely planted acreage by the 50 acres planted timely;
    (2) For late planted acreage, multiply the unit revenue guarantee 
for timely planted acreage by 93 percent and multiply the result by the 
50 acres planted late; and
    (3) For prevented planting acreage, multiply the unit revenue 
guarantee for timely planted acreage by:
    (i) Fifty percent and multiply the result by the 50 acres you were 
prevented from planting if the acreage is eligible for prevented 
planting coverage, and if the acreage is left idle for the crop year, 
or if a cover crop is planted not for harvest. Prevented planting 
compensation hereunder will not be denied because the cover crop is 
hayed or grazed; or
    (ii) Twenty-five percent and multiply the result by the 50 acres 
you were prevented from planting, if the acreage is eligible for 
prevented planting coverage, and if you elect to plant a substitute 
crop for harvest after the 10th day following the final planting date 
for the insured crop.
    The total of the three calculations will be the unit revenue 
guarantee for the unit. Your premium will be based on the result of 
multiplying the applicable per-acre premium for timely planted acreage 
by the 150 acres in the unit.
    (b) If you were prevented from planting, you must provide written 
notice to us not later than the acreage reporting date.

[[Page 33823]]

    (c) Late Planting.
    (1) For acreage planted to the insured crop after the final 
planting date but on or before 25 days after the final planting date, 
the unit revenue guarantee for each acre will be reduced for each day 
planted after the final planting date by:
    (i) One percent for the first through the tenth day; and
    (ii) Two percent for the eleventh through the twenty-fifth day.
    (2) In addition to the requirements of section 7 (Report of 
Acreage) of the Basic Provisions, you must report the dates the acreage 
is planted within the late planting period.
    (3) If planting of the insured crop continues after the final 
planting date, or you are prevented from planting during the late 
planting period, the acreage reporting date will be the later of:
    (i) The acreage reporting date contained in the Special Provisions 
for the insured crop; or
    (ii) Five (5) days after the end of the late planting period.
    (d) Prevented Planting (Including Planting After the Late Planting 
Period).
    (1) If you were prevented from planting the insured crop (see 
section 1) you may elect:
    (i) To plant the insured crop during the late planting period. The 
unit revenue guarantee for such acreage will be determined in 
accordance with section 11(c)(1);
    (ii) Not to plant this acreage to any crop except a cover crop not 
for harvest. You may also elect to plant the insured crop after the 
late planting period. In either case, the unit revenue guarantee for 
such acreage will be 50 percent of the unit revenue guarantee for 
timely planted acres. For example, if your unit revenue guarantee for 
timely planted acreage is $100 per acre, your prevented planting unit 
revenue guarantee would be $50 per acre ($100 multiplied by 0.50). If 
you elect to plant the insured crop after the late planting period, 
production to count for such acreage will be determined in accordance 
with section 10(b) through 10(e).
    (iii) Not to plant the intended crop but plant a substitute crop 
for harvest, in which case:
    (A) No prevented planting unit revenue guarantee will be provided 
for such acreage if the substitute crop is planted on or before the 
tenth day following the final planting date for the insured crop; or
    (B) A unit revenue guarantee equal to 25 percent of the unit 
revenue guarantee for timely planted acres will be provided for such 
acreage, if the substitute crop is planted after the tenth day 
following the final planting date for the insured crop. If you elected 
to exclude this coverage, and plant a substitute crop, no prevented 
planting coverage will be provided. You may elect to exclude prevented 
planting coverage when a substitute crop is planted for harvest and 
receive a reduction in the applicable premiums. If you wish to exclude 
this coverage, you must so indicate, on or before the sales closing 
date, on your application or on a form approved by us. Your election to 
exclude this coverage will remain in effect from year to year unless 
you notify us in writing on our form by the applicable sales closing 
date for the crop year for which you wish to include this coverage. All 
acreage of the crop insured under this policy will be subject to this 
exclusion.
    (2) Proof may be required that you had the inputs available to 
plant and produce the intended crop with the expectation of at least 
producing an amount equal to the unit revenue guarantee divided by your 
share.
    (3) In addition to the provisions of section 12 (Insurance Period) 
of the Basic Provisions, the insurance period for prevented planting 
coverage begins:
    (i) On the sales closing date contained in the Special Provisions 
for the insured crop in the county for the crop year the application 
for insurance is accepted; or
    (ii) For any subsequent crop year, on the sales closing date for 
the insured crop in the county for the previous crop year, provided 
continuous coverage has been in effect since that date. For example: If 
you make application and purchase insurance for corn for the 1997 crop 
year, prevented planting coverage will begin on the 1997 sales closing 
date for corn in the county. If the crop coverage remains in effect for 
the 1998 crop year (is not terminated or canceled during or after the 
1997 crop year, except the policy may have been canceled to transfer 
the policy to a different insurance provider, if there is no lapse in 
coverage), prevented planting coverage for the 1998 crop year began on 
the 1997 sales closing date.
    (4) The acreage to which prevented planting coverage applies will 
not exceed the total eligible acreage in which you have a share, 
adjusted for any reconstitution that may have occurred on or before the 
sales closing date. Eligible acreage is determined as follows:
    (i) If you participate in any program administered by the United 
States Department of Agriculture that limits the number of acres that 
may be planted for the crop year, the acreage eligible for prevented 
planting coverage will not exceed the total acreage permitted to be 
planted to the insured crop.
    (ii) If you do not participate in any program administered by the 
United States Department of Agriculture that limits the number of acres 
that may be planted, and unless we agree in writing on or before the 
sales closing date, eligible acreage will not exceed the greater of:
    (A) The FSA base acreage for the insured crop, including acres that 
could be flexed from another crop, if applicable;
    (B) The number of acres planted to the insured crop on the FSA Farm 
Serial Number during the previous crop year; or
    (C) One hundred percent of the simple average of the number of 
acres planted to the insured crop during the crop years that you 
certified to determine your yield.
    (iii) Acreage intended to be planted under an irrigated practice 
will be limited to the number of acres for which you had adequate 
irrigation facilities prior to the insured cause of loss which 
prevented you from planting.
    (iv) Prevented planting coverage will not be provided for any 
acreage:
    (A) That does not constitute at least 20 acres or 20 percent of the 
acreage in the unit, whichever is less (Acreage that is less than 20 
acres or 20 percent of the acreage in the unit will be presumed to have 
been intended to be planted to the insured crop planted in the unit, 
unless you can show that you had the inputs available before the final 
planting date to plant and produce another insured crop on the 
acreage). The 20 acres or 20 percent requirement is to be applied for 
each crop in a whole farm unit;
    (B) For which the premium calculator does not designate a premium;
    (C) Used for conservation purposes or intended to be left unplanted 
under any program administered by the United States Department of 
Agriculture;
    (D) On which another crop is prevented from being planted, if you 
have already received a prevented planting indemnity, guarantee for the 
same acreage in the same crop year, unless you provide adequate records 
of acreage and production showing that the acreage has a history of 
double-cropping in each of the last four years;
    (E) On which the insured crop is prevented from being planted, if 
any other crop is planted and fails, or is planted and harvested, hayed 
or grazed on the same acreage in the same crop year, (other than a 
cover crop as specified in section 11(a)(3)(i), or a substitute crop 
allowed in section 11(a)(3)(ii)), unless you provide adequate records 
of acreage and production showing that the acreage has

[[Page 33824]]

a history of double-cropping in each of the last four years;
    (F) For which planting history or conservation plans indicate that 
the acreage would have remained fallow for crop rotation purposes.
    (v) For the purpose of determining eligible acreage for prevented 
planting coverage, acreage for all units will be combined and be 
reduced by the number of acres of the insured crop timely planted and 
late planted. For example, assume you have 100 acres eligible for 
prevented planting coverage in which you have a 100 percent share. The 
acreage is located in a single FSA Farm Serial Number which you insure 
as two separate optional units consisting of 50 acres each. If you 
planted 60 acres of the insured crop on one optional unit and 40 acres 
of the insured crop on the second optional unit, your prevented 
planting eligible acreage would be reduced to zero (i.e., 100 acres 
eligible for prevented planting coverage minus 100 acres planted equals 
zero).
    (5) In accordance with the provisions of section 7 (Report of 
Acreage) of the Basic Provisions, you must report by unit any insurable 
acreage that you were prevented from planting. This report must be 
submitted on or before the acreage reporting date. For the purpose of 
determining acreage eligible for a prevented planting unit revenue 
guarantee the total amount of prevented planting and planted acres 
cannot exceed the maximum number of acres eligible for prevented 
planting coverage. Any acreage you report in excess of the number of 
acres eligible for prevented planting coverage, or that exceeds the 
number of eligible acres physically located in a unit, will be deleted 
from your acreage report.

    Signed in Washington, D.C. on June 16, 1997.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 97-16272 Filed 6-20-97; 8:45 am]
BILLING CODE 3410-08-P