Crop insurance: insuring the harvest before the hurricane arrives

The CSA describes its Insurance Program as the breakdown of every insurance available, covered risks, coverage levels, term, valuation of harvests and plantations, deductibles, rates and premiums, and presents it as a guide for sales promoters, farmers and agricultural technicians. The reinsurer is the Federal Crop Insurance Corporation, and it is that federal relationship that sets the filing period. There are two classes of insurance the CSA distinguishes throughout the programme: harvest and plantation, and for citrus the administrative expense is charged per sub-crop, $30.00 for harvest or $30.00 for plantation. The CSA works from its Central Office in Dorado and its Inspection and Adjustment Office in Adjuntas, plus the Department of Agriculture’s Regional Offices and the Agricultural Extension Service offices.

The CSA distinguishes between customers who insured last year and new customers, and asks each for different information. If you insured last year, you must visit the Department of Agriculture office that corresponds to you to complete and process your applications, and to do it by phone you need your customer number, the previous inspection report and — if you had a claim last year — the Loss Claims Report. If you are a new customer, you need the correct and complete name of the applicant or the corporation to be insured, the personal or employer social security number, physical and mailing address, the farm’s physical address, and legal tenure of the farm, whether a lease or deeds with defined boundaries. Both types of customer must provide or update email and phone numbers. If a corporation applies, you must submit a copy of the corporate resolution and evidence of the IRS employer social security number. If an estate applies, a copy of the declaration of heirs or, if not yet obtained, a sworn statement signed by all heirs indicating who is authorized to apply. And there are per-crop insurability rules: in vegetables, no crop intercropped with another is insured, nor harvests planted in flood-prone areas or near rivers; in coffee, plantations six months or older at the sales period date are insured; in plantains and first-crop bananas, coverage runs from a minimum of 300 plants per half cuerda to a maximum of 1,200 plants per cuerda; and in intensely intercropped citrus the minimum is 80 trees per cuerda, all of the same variety.

• Filing within the sales period: 1 April to 31 May for all crops except vegetables and pineapple. Applications after the deadline are not accepted.Verified against the official source
• Submitting the application with full payment of the premium and the administrative expense: there is no insurance contract with partial payment.Verified against the official source
• For the federal premium subsidy: having filed compliance certification AD-1026 at Farm Service Agency offices before the coverage year begins.Verified against the official source
• Coffee: the plantation must be six months or older at the sales period date.Verified against the official source

• Customer who insured last year: customer number, previous inspection report and, if there was a claim, the Loss Claims Report.
• New customer: applicant’s full name, personal or employer social security number, physical and mailing address, and the farm’s physical address.
• Legal tenure of the farm: a lease, or deeds with the farm’s boundaries defined.
• If someone else will sign: signature authorization document CSA-PR-138.
• Corporations: a copy of the corporate resolution and evidence of the IRS employer social security number.
• Estates: a copy of the declaration of heirs or, if not yet obtained, a sworn statement signed by all heirs naming the person authorized to apply.

1. 1

   Step 1: Mark the calendar before anything else

   According to the reinsurer, the Federal Crop Insurance Corporation, the filing period for all crops except vegetables and pineapple runs from 1 April to 31 May. The CSA urges farmers to file within the established sales period and adds the sentence that shuts the door: applications filed after the deadline will not be accepted. Confirm the exact dates for the current policy year with the CSA before relying on them.

2. 2

   Step 2: File in April, not May

   The ADEA premium subsidy for crops is 45% in April and 35% in May, up to a maximum of $5,000 per farmer per Agricultural Region. That is ten percentage points for filing a month earlier. For vegetables the subsidy is 45% year-round and for pineapple 35% year-round, with the same $5,000 cap per farmer per Agricultural Region.

3. 3

   Step 3: Gather what applies to you as an old or new customer

   If you insured last year, have your customer number, the previous inspection report and, if you had a claim, the Loss Claims Report; and visit the Department of Agriculture office that corresponds to you to complete and process the application. If you are a new customer, have the applicant’s or corporation’s correct and complete name, the personal or employer social security number, the physical and mailing address, the farm’s physical address, and legal tenure of the farm — lease or deeds with defined boundaries as they appear in the tenure documents. In both cases you must provide or update email and phone numbers.

4. 4

   Step 4: If you are not the one signing, sort out authorization first

   If you authorize someone else to sign the insurance documents, you must deliver or send the CSA-PR-138 signature authorization document to the CSA. Corporations must submit a copy of the corporate resolution and evidence of the IRS employer social security number. Estates must present a copy of the declaration of heirs or, if not yet obtained, a sworn statement duly signed by all heirs naming the person authorized to apply for the insurance.

5. 5

   Step 5: Pay in full or there is no insurance

   The CSA says it plainly: it is the farmer’s exclusive responsibility to deliver or send the application to the Corporation with payment of the premium and the corresponding administrative expense, and no insurance contract will exist on applications with partial payment of premium and administrative expenses. If payment comes from a loan from a financial institution, it is the farmer who must handle matters with the agencies involved, the application must be accompanied by a cheque from the institution for the amount of the premium, and the administrative expenses must additionally be paid when completing the application.

6. 6

   Step 6: File AD-1026 at Farm Service Agency

   As a requirement to be eligible for the federal crop insurance premium subsidy, all producers must have filed compliance certification AD-1026 at Farm Service Agency offices before the coverage year begins. It is a separate federal step, and "before the coverage year begins" means doing it after you have already filed does not help.

7. 7

   Step 7: Check your crop’s rules, which are not the same

   Vegetables: the term runs from when you pay the premium and administrative expenses to the end of the vegetative cycle, provided a prior inspection finds the crop has been established 20 calendar days or less — and yam, tanier, sweet potato and pigeon pea are expressly excluded. For direct seeding there are 20 calendar days to apply after germination, not exceeding 35 calendar days between planting and application. No vegetable intercropped with another crop is insured, nor harvests planted in flood-prone areas or near rivers. Coffee: plantations six months or older at the sales period date are insured; you must insure the entire planting of a single crop per insurance class across all your properties in the same agricultural region; you may insure all the canephora, all the arabica or both in full; and plantations intensely intercropped in equal proportion with different species are not insured. Plantains and bananas: coverage runs between 300 plants per half cuerda and 1,200 plants per cuerda; ratoon banana harvest insurance covers hurricane risk only, with a minimum of 680 plants per cuerda, and cannot be intercropped. Citrus: in intensely intercropped plantations the minimum is 80 trees per cuerda of the same variety, and the administrative expense is charged per sub-crop, $30.00 for harvest or $30.00 for plantation.

8. 8

   Step 8: If you are an estate, watch the employer number

   The CSA warns that for estate applications without an employer social security number the ADEA subsidy will not apply, so the farmer pays the entire insurance premium. Sorting out the employer number before the sales period can be worth up to $5,000.

CSA Central Office in Dorado: 787-722-2748 and 787-722-2965, fax 787-725-4710. Inspection and Adjustment Office in Adjuntas: 787-829-2900 and 787-829-2950, fax 787-829-1511. Hours Monday to Friday, 7:30 AM to 4:00 PM. The Department of Agriculture’s Regional Offices and your area’s Agricultural Extension Service offices also assist. Farmers who insured the previous year must visit the Department of Agriculture office that corresponds to them to complete and process their applications.

• Filing after 31 May: the CSA does not accept late applications and publishes no exception.
• Filing in May instead of April and losing ten percentage points of ADEA subsidy.
• Paying the premium partially: without full payment there is no insurance contract.
• Not filing AD-1026 at Farm Service Agency before the coverage year begins.
• Being an estate without an employer social security number, which removes the ADEA subsidy.
• Insuring only part of the coffee: you must insure the whole planting of a single crop per insurance class in the agricultural region.
• Planting intercropped vegetables or near a river and expecting the CSA to insure them.
• Treating the dates and percentages the page publishes as current without confirming with the CSA.

These are the government pages this guide is based on.

• Departamento de Agricultura de Puerto Rico

  Agricultura

  www.agricultura.pr.gov