Farmers and ranchers who sell their products on the roadside, at farmers markets or who engage in agritourism now have greater crop insurance flexibility because of recent updates to the Federal Crop Insurance Program's Common Crop Insurance Policy.
Such growers are direct marketers who sell products locally or who allow customers onto their land to, for example, pick their own produce.
The policy changes will essentially make it easier for growers to provide a production history, which affects the pricing of crop insurance, University of Arkansas Department of Agriculture crop extension economist Hunter Biram said.
Specialty crop producers such as fruit tree and berry farmers would be primarily affected, Biram said. Those crops are the prominent non-row crops grown in Arkansas.
"This would impact specialty crop producers who have not had much access to risk management through the federal crop insurance program," Biram said.
A production history "is important in determining the ... price of insurance, or the insurance premium," Biram said.
Many farmers get crop insurance coverage for their planted acreage under the Federal Crop Insurance Program.
The U.S. Department of Agriculture administers the program via the Federal Crop Insurance Corporation (FCIC), which writes its policies, and the department's Risk Management Agency, which administers the program, according to the National Agricultural Law Center's website.
Approved insurance providers can then sell and service federal crop insurance regulated by the USDA, according to the USDA's website.
The policy changes open up flexibility to direct marketers as to the kind of reports they need to provide under their crop insurance policies, said Micah Brown, staff attorney with the National Agricultural Law Center.
Farmers must continue to provide acceptable production records such as certified scale weight records, daily sales records, pick records and machine harvest records.
The FCIC uses production records to determine insurance coverage for growers.
Under the former rules, producers were required to have records from "disinterested third parties," or entities that do not have a direct relationship with the grower, such as a grain elevator, Brown said.
The former policy was not necessarily advantageous to producers who directly market their commodities to the consumer, especially family-run businesses with less access to a disinterested third party.
The rule changes expand the number of records "acceptable" for direct-marketing producers to provide to insurance companies when they apply for coverage.
In another policy change, if a grower's insurance provider denies a claim because the provider determines good farming practices were not implemented, growers will now have 30 days to appeal their insurer's determination to the FCIC. Growers must usually apply "good farming practices," or generally recognized practices for the normal production of an insured crop, to qualify for insurance.
The policy changes will affect most reinsured crop insurance policies with a change date of on or after June 30, and the FCIC will consider public comment on the topic until Aug. 29.