Revenue Protection (RP)
RP is available for: Barley, Canola, Corn, Cotton, Dry Beans, Dry Peas, Grain Sorghum, Peanuts, Popcorn, Rice, Soybeans, Sunflowers, and Wheat.
Revenue Protection policies insure producers against yield losses due to natural causes and also insures the producer against loss in value due to decline in price or a combination of both.
RP uses a Projected Price and Harvest Price to determine if a price loss has occurred during the growing season. At no time is the price the grower received for the crop considered. The Projected and Harvest Prices are determined by averaging a futures contract price from a board of trade over a given period of time known as the “Discovery Period”. There is a limit on upward movement of the Harvest Price - it cannot exceed 2 times the Projected Price - but there is no limit on downward movement. The parameters outlining the futures contract price, board of trade and discovery period can be found in the Commodity Exchange Price Provisions (CEPP).
The RP policy guarantee is based upon the higher of the Projected or Harvest Price and the guarantee will increase in a year in which the Harvest Price is higher than the Projected. There is no additional premium charged when this occurs.
Both the Revenue Guarantee and the Revenue to Count are based upon 100% of the Approved APH and 100% of the production harvested. The producer’s share of the crop is not taken into account until the total indemnity has been calculated.