Crop Insurance: A Look at the Importance and Types of Insurance

 


Ray Grabanski leads Progressive Ag in Fargo, North Dakota, with a focus on developing crop-marketing plans that reduce risk and help farmers land prices in the top half of the market. Additionally, Ray Grabanski’s firm entered the crop insurance industry in 2000 and aligns with highly qualified agents throughout Minnesota and North and South Dakota. Crop insurance helps farmers protect their investments and serves as an important part of ensuring a future profit.

One of the most important risk-management tools for farmers, crop insurance mitigates the financial impacts associated with decreased market prices for crops, and protects farmers against crop loss due to harsh weather conditions. A number of weather phenomena and natural disasters pose a threat to crops, such as floods or drought, hail, and fierce storms, including tornados. While weather forecasts can provide an estimate of future conditions, they cannot account for the unpredictability of nature or predict the length of droughts with complete accuracy.

Crop insurance providers offer two kinds of insurance: yield insurance and revenue insurance. Also known as multiple-peril crop insurance, yield insurance delivers comprehensive protection against unavoidable loss and harvest quality due to naturally occurring events, including disease and insect outbreaks. It is based on the farm’s production history. Revenue insurance compensates farmers for lost revenue due to drops in market prices and bases payments on the farm’s average revenue.

ARC-CO Case Potentially Responsible for Farmer Profit Loss Nationwide

Ray Grabanski serves as the founder of the North Dakota-based Progressive Ag Law, where he provides a range of legal services for farmers and agribusinesses as a licensed attorney. In 2015, Ray Grabanski began leading awareness efforts for discrepancies between promised payments and actual payouts made under a 2014 farm bill and the Agriculture Risk Coverage-County (ARC-CO) federal commodity program.

The United States Department of Agriculture created ARC-CO to serve as an alternative for direct payment programs for farmers. Developed in February 2014, the commodity program provided financial and price support for farmers in the event that they fell short of a benchmark revenue. Payouts by ARC-CO were dependent on product yield and benchmark price, a figure determined through an invasive 15-page survey delivered to farmers before the ARC-CO bill passed in July 2015. According to preliminary investigations and farmer interviews, many farmers failed to complete the survey for two reasons: it asked for intrusive information on private net worth and farmers were uninformed of the survey’s importance at the time.

Problems arose when farmers began seeing the first set of payouts by ARC-CO in October 2015. Due to incomplete data required to determine the benchmark price, farmers received payouts that vastly differed from those in neighboring counties. For instance, farmers in LaMoure County, North Dakota received no compensation for revenues lost while neighboring counties received payments that varied between $20.95 and $80.94 per acre. Furthermore, issues with the ARC-CO problem also affected farmers in other states, including Iowa, Indiana, and Nebraska.

Progressive Ag Law continues to investigate the case and holds regular meetings in North Dakota and other affected states to keep farmers abreast of the investigation’s progress. Farmers are encouraged to attend any meeting at their convenience.

For additional information about the case, visit progressiveaglaw.com/agriculture-risk-coverage-county.

Word at Work Events Provide Theological Discussions for Church Members

Progressive Ag president and chief market analyst Ray Grabanski possesses nearly three decades in agribusiness and agricultural law, and leads his company in providing a wide range of services to farmers and agribusiness organizations in Fargo, North Dakota. Ray Grabanski also remains an active contributor to his local community and donates to the Institute of Lutheran Theology (ILT), a non-ELCA seminary school. ILT offers educational opportunities for congregations and church groups through its Word at Work Events.

Word at Work Events serve as weekend lay schools of theology where congregation and church members can from learn ILT faculty and become engaged in discussion regarding crucial topics for society and church. Participating organizations can select speakers and topics, and schedule events according to their convenience. Typical sessions take place Friday evening, Saturday morning and afternoon, and conclude Sunday morning. The ILT faculty is comprised of skilled, communicative professionals in their field with a dedication to the Scriptures.

Congregations and church groups are responsible for all travel, lodging, and program fees, however participants may offset the costs through budgeted funds or endowment proceeds, or charge a registration fee.