When you enrol in Production Insurance, you are guaranteed a level of production based on your yield history and the level of coverage you choose. A claim may be paid if an insured peril causes your yield to fall below your guaranteed production.
Production Insurance covers you for losses due to adverse weather, disease, pests, wildlife, or other uncontrollable natural perils, except for perils excluded in the Contract of Insurance – General Terms and the Commodity-Specific Terms: Hemp on the Publications page.
Production Insurance coverage for hemp applies only during the period from seeding or planting until harvest. Loss or damage due to storage conditions is not insured. If your farm management practices contribute to a production loss, you may lose some or all of your insurance coverage.
Available coverage
The following coverages are available in addition to production loss coverage.
Replant coverage
A claim may be paid under replant coverage if you are forced to replant some or all acres of your crop due to an insured peril. Agricorp will pay a claim based on the original crop you planted, and the amount is based on a maximum per-acre rate that Agricorp sets annually for each crop.
The minimum acreage eligible for a claim under replant coverage is one unbroken acre.
Calculating your coverage and claims
Your coverage depends on:
- Average farm yield
- Coverage level
- Guaranteed production
- Claim price
Average farm yield (AFY)
An AFY is calculated and used as a benchmark to determine if your actual production is below average.
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If you are… |
Your AFY is calculated… |
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An existing participant | Using your reported yields for up to the past 10 years. |
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A new participant | By assigning an underwritten 5-year AFY for each crop that is based on a variety of factors, such as soil type, drainage and township averages.
Note: Each year that you participate, your actual yield replaces an underwritten yield until your AFY is composed entirely of your own yields.
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Yield buffering
One bad production year doesn't significantly impact a producer's 10-year average farm yield. Unusually high and low yields are buffered to stabilize your AFY and lessen the impact of extreme yields. Buffering is applied after the yield adjustment factor.
- Your yield is buffered up if it is below 70% of your 10-year average (lower threshold). The yield is buffered up by two thirds of the difference between your yield and the lower threshold.
- Your yield is buffered down if it is above 130% of your 10-year average (upper threshold). The yield is buffered down by two thirds of the difference between your yield and the upper threshold.
For examples of how yield buffering works, see the
Yield Buffering feature sheet.
Coverage level
When you apply or renew each year, you choose one coverage level. It determines your guaranteed production.
Guaranteed production
Your guaranteed production is determined by multiplying your AFY by your selected coverage level. If an insured peril causes your actual yield to fall below your guaranteed production, a production loss claim may be paid on the difference.
Claim price
Agricorp sets a fixed claim price in the spring based on the processor-specific contract price for fiber or grain and fibre.
