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Kansas | Someone correct me if I'm wrong but I do believe after the go arounds I had on the phone with my agent, this has finally got beaten into my head.
75 percent of your approved yield
Then......
Only 75 percent of the established price.
So say your yield is 170. Say you go out and harvest 127.5 bushels to the acre. You collect nothing. That is 75 percent of your approved yield. So you have to yield less than that to file paperwork.
Next, You harvest say 100 bpa. You have 27.5 bpa to file a claim on. If your established price is say 4.06 then you will only collect 75 percent of that or in other words approximately 3.05 a bushel on 27.5 bushel per acre. And.......only on your percentage if it's crop share.
NOW, Here's where they really bend you over the rail......
If the price goes up since the established price or for that matter, lets just say it stays at 4.06 (this is for future use, right now it doesn't fit the bill for where the markets are at) and you got an extra 1.01 per bushel on that 100 bushel you did harvest. Since you took in an extra 1.01 on that 100.....it goes against your elected price that you are going to receive since it was above and beyond what was assured. In other words.......
127.5 x 3.05 = 388.88
100 x 4.06 = 406
27.5 x 3.05 = 83.88
406 + 83.88 = 489.88
489.88 - 388.88 = 101
101 > 83.88 = you don't get a check and you still have to pay in the premium.
My math might be a bit off. Someone show me the way if it is. It's late and its' been awhile since I had to figure this but this is how I got snookered on the wheat two years ago in the tail end of the drought.
This might also explain why I have very little liking for underwriters for these policies. They zig zag it around that you have to have a complete and utter failure to collect beans. If you have a small loss you eat it and they still get thier fat premium which doesn't have much gov't subsidy anymore.
I hope I didn't confuse this with crc but don't think I did. Someone will set me straight if I did. This is (re) learning for me too.
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Can someone help me figuring out crop insurance?
