The United States Department of Agriculture’s Risk Management Agency announced Thursday that it will continue to defer accrual of interest for 2019 crop year insurance premiums to help farmers and ranchers affected by this year’s “extreme weather.”
The USDA will defer the accrual of interest on crop insurance premiums to the earlier of the applicable termination date or January 31st, 2020 for policies with a premium billing date of August 15th, 2019. The extension is necessary because harvest progress has been delayed and crop insurance claims are not typically settled until harvest is complete.
The USDA previously announced a deferral to November 30th, 2019, providing producers with an additional two months from the traditional date of September 30th. The announcement means producers will have until January 31st to pay the 2019 premium without accruing interest.
Any premium not paid by the new deadline will be accrued interest consistent with the terms of the policy. Producers reported to the USDA that they were prevented from planting on nearly 20 million acres this year.
Indemnities from crop insurance have reached almost six billion dollars this year, with more than three-point nine billion dollars of that going to producers unable to plant because of flooding or excess moisture.
More than three billion dollars is available through the disaster relief package passed by Congress and signed by President Donald Trump in early June, which includes a top-up payment for producers who made prevented planting claims.
The USDA has distributed nearly 580 million dollars in top-up payments through producers’ Approved Insurance Providers, and additional payments will be made in the middle of each month as more prevented planting claims are processed.
The Disaster Relief Act also authorized the Wildfire and Hurricane Indemnity Program Plus, administered by the USDA’s Farm Service Agency, and included new programs to cover losses for milk dumped or removed from the commercial market and losses of eligible farm stored commodities due to eligible disaster events in 2018 and 2019.
Farmers who planted cover crops on prevented plant acres were able to hay, graze, and chop those fields earlier than November this year while maintaining eligibility for their full 2019 prevented planting indemnity.
The USDA adjusted the final haying and grazing date from November 1st to September 1st to help farmers prevented from planting because of flooding and excess rainfall this spring.
The agency also determined silage, haylage, and baleage should be treated in the same manner as haying and grazing this year.