Crop Insurance – What You Need to KnowKendall Jones, President & CEO of ProAg

Women In Agribusiness Summit

Minneapolis 2017September 27

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What is Crop Insurance?U.S. Crop Insurance: Three Classes of Business

Public-Private Partnership:

Multiple Peril Crop Insurance (MPCI)• USDA Risk Management Agency (RMA)

Private Products:

Crop Hail• Private program

Named Peril• Private program

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How and why? 1938: Federal Crop Insurance Act Major modifications:

1980 1994 2000

2014: Agricultural Act (Farm Bill)

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U.S. Crop Insurance2016 Gross Premium Breakdown

Named Peril $40M*

Crop Hail$982M

MPCI$9.3B

* EstimatedCrop Hail - Data as January 2017MPCI - Data as of March 2017Source: Crop Hail - National Crop Insurance Services

MPCI – RMA - Summary of Business Report

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Corn$3,684,726,202

(37.75%)

Soybeans $2,106,432,059

(21.58%)

Wheat$1,284,485,112

(13.16%)

Cotton$656,497,774

(6.73%)

All Other$2,166,637,467

(22.21%)

U.S. Crop InsuranceLargest MPCI Premium Crops in 2016

Data as of April 2017Source: RMA – Nationwide Summary by Commodity Report

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Who Pays for It?USDA: Risk Management Agency Program Administration Farmer Premium Subsidy

Expense Load Reinsurance Protection

Private Sector Farmers

Premium Deductibles

Insurance companies take underwriting & operational risk Agents support farmers

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What does it cost?

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U.S. Crop Insurance2011-2016 Cause of Crop MPCI Losses by Peril

Plant Disease

FailedIrrigation

Cold Weather

Other

CommodityPrice Decrease

Hail/Wind

ExcessMoisture

Hot DryWeather

$0.00 $10.00 $20.00 $30.00$ Indemnity (Billions)

49%

23%

9%

7%

5%

5%

2%

1%

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How is the Program Delivered?Successful Public – Private Partnership USDA RMA (Federal Crop Insurance Corporation) Private Companies (ProAg) Independent Agents

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What is the impact?Stability US Economy

Lenders Manufacturers Food Prices Labor Families

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Contact Information

Kendall JonesPresident & CEO ProAg

@kjproagKendall JonesProAg.com/kendalls-blog