4 Types of Crop Insurance

Crop insurance is a type of insurance coverage that is purchased by crop farmers in order to insure against losses. There are several different types of crop insurance that a farmer can purchase. Here are some of the different types of crop insurance that is available. 


MPCI stands for multiple peril crop insurance. This is a type of crop insurance that is designed to cover the crops against several different types of loss. This type of coverage will protect the farmer against any weather-related losses, such as a tornado or a hail storm. In addition, this policy covers things like low yields, late planting, prevented planting and replanting costs. 

2. APH

This term stands for actual production history. This type of insurance is based on the production history of a farm, over a certain number of years. In most cases, a policy will base the actual production history on a period of somewhere between four and 10 years. The average production will be calculated over that time period, and then a certain percentage of the yield will be paid if a loss occurs.

This type of policy provides coverage for a wide variety of perils. For example, the farmer could file a claim due to drought, wind damage, hail, frost, insects, disease or excessive moisture. If the yield of a crop is less than the predetermined covered amount, the farmer will receive a check for the difference between the two percentages. This is the most common type of crop insurance that is available in the market today. It has been used in the farming industry for many years.

3. GRP

GRP stands for group risk plan. This is a type of crop insurance that is based on the yield of a group of farmers from a particular county. This is not a type of policy that is based on an individual farmers yield, like APH. With this type of policy, you could be paid for an insurance settlement regardless of the actual yield of your farm. Your farm could do fine, but if the average yield of the entire county decreased below a certain amount, you could still receive a payment. This type of coverage allows you to choose the yield level that you want to be covered against, when calculated with the average of all of the farms in the county.

4. CRC

CRC is a term that stands for crop revenue coverage. Instead of being based only on the yield of the farm, this coverage is based on the total amount of revenue that is generated from a crop. With this type of coverage, you will also get protection against drops in prices for the crop instead of just protection against losses. This is a comprehensive type of coverage that is designed to look at the bottom line instead of only looking at how much you were able to harvest from a particular farm for the year.