Crop-Hail Insurance from FBN^® Insurance

The amount of hail coverage each farmer needs is dependent on each individual ag operation, so the answer varies from farmer to farmer. Everyone has a different perspective on coverage and appetite for risk. Different crops and crop values, as well as crop potential, can also weigh into the decision of how much coverage is needed.

Insurance companies have set dollar per acre liability limits based on each crop, but will make considerations to increase these limits on an individual basis if the value of the crop can be shown to exceed the liability limit.

Cost of coverage can be a major consideration in the amount of coverage being purchased. In some areas rates are exceptionally affordable due to the low probability of a hail event. In other areas the opposite is true.

There is no specific crop hail insurance deadline; most types of hail coverage can be purchased at any time during the crop’s growing season. 

Some farmers purchase crop-hail coverage when the weather patterns are volatile, while others wait until the radar is purple and are hoping coverage will be bound before the hail hits. Be careful not to wait too long to apply, though. Many regions have a minimum two-hour waiting period (or longer in some areas) from the time you sign the hail application to when coverage is bound. 

There are years when the market swings upwards and the value of the crop warrants increasing hail coverage to cover that value. When the market is in a downturn, often hail insurance coverage works with your multi-peril insurance to cover the cost of your inputs, keeping your operation whole when hail happens.

After a certain point, the insurance company may require a growing season inspection of the crop before the coverage will attach.  

In many cases, crop specific endorsements that enhance the underlying hail policy do have purchase deadlines in order to access the additional peril. Generally, the insurance company will not immediately attach coverage, but it will attach at 12:01 AM the following day from when coverage was requested/applied for. In some cases, there is a binder provision that would apply in as little as two hours.

Cost is an important factor when purchasing most items, and crop insurance is no exception. However, it is important to reexamine the value of your crop as markets change, as you lock in a production contract, as you reflect on the coverage in place with your MPCI policy, etc..

Bottom line, when crop values increase into the growing season where hail risk is present, you may want to consider adding crop-hail coverage or increasing coverage per acre if you have already taken it pre-planting. 

Another area of particular concern would be when your yield potential seems to be outpacing your approved yield. Since this is the benchmark yield used for most crop insurance policies, you can be effectively underinsured in this scenario.

There are several available supplemental insurance coverage endorsements that complement the underlying hail coverage. The availability, cost, rules and provisions of these endorsements vary from one insurance company to another.

Examples of these endorsements include greensnap/wind for corn, open boll hail for cotton, soybean lodging, early season frost/freeze on sugar beets and fire/lightning coverage in small grains stubble.

If you have already purchased a hail policy, you can: 

• Increase the amount of coverage on the current policy (the company may require inspection prior to attaching) as a way to stack multiple policy deductibles with the same company (as an example - $300/ac at 0% deductible and $200 at 5% deductible).

• Purchase an additional policy from another company.

• Corn

• Soybeans

• Rice

• Cotton

• Small Grains (Wheat, Barley, Oats, Rye)

• And many others