[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 7USC1508]
TITLE 7--AGRICULTURE
CHAPTER 36--CROP INSURANCE
Sec. 1508. Crop insurance
(a) Authority to offer insurance
(1) In general
If sufficient actuarial data are available (as determined by the
Corporation), the Corporation may insure, or provide reinsurance for
insurers of, producers of agricultural commodities grown in the
United States under 1 or more plans of insurance determined by the
Corporation to be adapted to the agricultural commodity concerned.
To qualify for coverage under a plan of insurance, the losses of the
insured commodity must be due to drought, flood, or other natural
disaster (as determined by the Secretary).
(2) Period
Except in the cases of tobacco, potatoes, and sweet potatoes,
insurance shall not extend beyond the period during which the
insured commodity is in the field. As used in the preceding
sentence, in the case of an aquacultural species, the term ``field''
means the environment in which the commodity is produced.
(3) Exclusion of losses due to certain actions of producer
(A) Exclusions
Insurance provided under this subsection shall not cover
losses due to--
(i) the neglect or malfeasance of the producer;
(ii) the failure of the producer to reseed to the same
crop in such areas and under such circumstances as it is
customary to reseed; or
(iii) the failure of the producer to follow good farming
practices, including scientifically sound sustainable and
organic farming practices.
(B) Good farming practices
(i) Informal administrative process
A producer shall have the right to a review of a
determination regarding good farming practices made under
subparagraph (A)(iii) in accordance with an informal
administrative process to be established by the Corporation.
(ii) Administrative review
(I) No adverse decision
The determination shall not be considered an adverse
decision for purposes of subtitle H of the Department of
Agriculture Reorganization Act of 1994 (7 U.S.C. 6991 et
seq.).
(II) Reversal or modification
Except as provided in clause (i), the determination
may not be reversed or modified as the result of a
subsequent administrative review.
(iii) Judicial review
(I) Right to review
A producer shall have the right to judicial review
of the determination without exhausting any right to a
review under clause (i).
(II) Reversal or modification
The determination may not be reversed or modified as
the result of judicial review unless the determination
is found to be arbitrary or capricious.
(C) Limitation on revenue coverage for potatoes
No policy or plan of insurance provided under this chapter
(including a policy or plan of insurance approved by the Board
under subsection (h) of this section) shall cover losses due to
a reduction in revenue for potatoes except as covered under a
whole farm policy or plan of insurance, as determined by the
Corporation.
(4) Expansion to other areas or single producers
(A) Area expansion
The Corporation may offer plans of insurance or reinsurance
for production of agricultural commodities in the Commonwealth
of Puerto Rico, the Virgin Islands, Guam, American Samoa, the
Commonwealth of the Northern Mariana Islands, the Republic of
the Marshall Islands, the Federated States of Micronesia, and
the Republic of Palau in the same manner as provided in this
section for production of agricultural commodities in the United
States.
(B) Producer expansion
In an area in the United States or specified in subparagraph
(A) where crop insurance is not available for a particular
agricultural commodity, the Corporation may offer to enter into
a written agreement with an individual producer operating in the
area for insurance coverage under this chapter if the producer
has actuarially sound data relating to the production by the
producer of the commodity and the data is acceptable to the
Corporation.
(5) Dissemination of crop insurance information
(A) Available information
The Corporation shall make available to producers through
local offices of the Department--
(i) current and complete information on all aspects of
Federal crop insurance; and
(ii) a listing of insurance agents and companies
offering to sell crop insurance in the area of the
producers.
(B) Use of electronic methods
(i) Dissemination by Corporation
The Corporation shall make the information described in
subparagraph (A) available electronically to producers and
approved insurance providers.
(ii) Submission to Corporation
To the maximum extent practicable, the Corporation shall
allow producers and approved insurance providers to use
electronic methods to submit information required by the
Corporation.
(6) Addition of new and specialty crops
(A) Data collection
Not later than 180 days after October 13, 1994, the
Secretary shall issue guidelines for publication in the Federal
Register for data collection to assist the Corporation in
formulating crop insurance policies for new and specialty crops.
(B) Addition of new crops
Not later than 1 year after October 13, 1994, and annually
thereafter, the Corporation shall report to Congress on the
progress and expected timetable for expanding crop insurance
coverage under this chapter to new and specialty crops.
(C) Addition of direct sale perishable crops
Not later than 1 year after October 13, 1994, the
Corporation shall report to Congress on the feasibility of
offering a crop insurance program designed to meet the needs of
specialized producers of vegetables and other perishable crops
who market through direct marketing channels.
(D) Addition of nursery crops
Not later than 2 years after April 4, 1996, the Corporation
shall conduct a study and limited pilot program on the
feasibility of insuring nursery crops.
(7) Adequate coverage for States
(A) Definition of adequately served
In this paragraph, the term ``adequately served'' means
having a participation rate that is at least 50 percent of the
national average participation rate.
(B) Review
The Board shall review the policies and plans of insurance
that are offered by approved insurance providers under this
chapter to determine if each State is adequately served by the
policies and plans of insurance.
(C) Report
(i) In general
Not later than 30 days after completion of the review
under subparagraph (B), the Board shall submit to Congress a
report on the results of the review.
(ii) Recommendations
The report shall include recommendations to increase
participation in States that are not adequately served by
the policies and plans of insurance.
(8) Special provisions for cotton and rice
Notwithstanding any other provision of this chapter, beginning
with the 2001 crops of upland cotton, extra long staple cotton, and
rice, the Corporation shall offer plans of insurance, including
prevented planting coverage and replanting coverage, under this
chapter that cover losses of upland cotton, extra long staple
cotton, and rice resulting from failure of irrigation water supplies
due to drought and saltwater intrusion.
(b) Catastrophic risk protection
(1) In general
The Corporation shall offer a catastrophic risk protection plan
to indemnify producers for crop loss due to loss of yield or
prevented planting, if provided by the Corporation, when the
producer is unable, because of drought, flood, or other natural
disaster (as determined by the Secretary), to plant other crops for
harvest on the acreage for the crop year.
(2) Amount of coverage
(A) In general
Subject to subparagraph (B)--
(i) in the case of each of the 1995 through 1998 crop
years, catastrophic risk protection shall offer a producer
coverage for a 50 percent loss in yield, on an individual
yield or area yield basis, indemnified at 60 percent of the
expected market price, or a comparable coverage (as
determined by the Corporation); and
(ii) in the case of each of the 1999 and subsequent crop
years, catastrophic risk protection shall offer a producer
coverage for a 50 percent loss in yield, on an individual
yield or area yield basis, indemnified at 55 percent of the
expected market price, or a comparable coverage (as
determined by the Corporation).
(B) Reduction in actual payment
The amount paid to a producer on a claim under catastrophic
risk protection may reflect a reduction that is proportional to
the out-of-pocket expenses that are not incurred by the producer
as a result of not planting, growing, or harvesting the crop for
which the claim is made, as determined by the Corporation.
(3) Alternative catastrophic coverage
Beginning with the 2001 crop year, the Corporation shall offer
producers of an agricultural commodity the option of selecting
either of the following:
(A) The catastrophic risk protection coverage available
under paragraph (2)(A).
(B) An alternative catastrophic risk protection coverage
that--
(i) indemnifies the producer on an area yield and loss
basis if such a policy or plan of insurance is offered for
the agricultural commodity in the county in which the farm
is located;
(ii) provides, on a uniform national basis, a higher
combination of yield and price protection than the coverage
available under paragraph (2)(A); and
(iii) the Corporation determines is comparable to the
coverage available under paragraph (2)(A) for purposes of
subsection (e)(2)(A) of this section.
(4) Sale of catastrophic risk coverage
(A) In general
Catastrophic risk coverage may be offered by--
(i) approved insurance providers, if available in an
area; and
(ii) at the option of the Secretary that is based on
considerations of need, local offices of the Department.
(B) Need
For purposes of considering need under subparagraph (A)(ii),
the Secretary may take into account the most efficient and cost-
effective use of resources, the availability of personnel,
fairness to local producers, the needs and convenience of local
producers, and the availability of private insurance carriers.
(C) Delivery of coverage
(i) In general
In full consultation with approved insurance providers,
the Secretary may continue to offer catastrophic risk
protection in a State (or a portion of a State) through
local offices of the Department if the Secretary determines
that there is an insufficient number of approved insurance
providers operating in the State or portion of the State to
adequately provide catastrophic risk protection coverage to
producers.
(ii) Coverage by approved insurance providers
To the extent that catastrophic risk protection coverage
by approved insurance providers is sufficiently available in
a State (or a portion of a State) as determined by the
Secretary, only approved insurance providers may provide the
coverage in the State or portion of the State.
(iii) Timing of determinations
Not later than 90 days after April 4, 1996, the
Secretary shall announce the results of the determinations
under clause (i) for policies for the 1997 crop year. For
subsequent crop years, the Secretary shall make the
announcement not later than April 30 of the year preceding
the year in which the crop will be produced, or at such
other times during the year as the Secretary finds
practicable in consultation with affected crop insurance
providers for those States (or portions of States) in which
catastrophic coverage remains available through local
offices of the Department.
(iv) Current policies
This clause shall take effect beginning with the 1997
crop year. Subject to clause (ii) all catastrophic risk
protection policies written by local offices of the
Department shall be transferred to the approved insurance
provider for performance of all sales, service, and loss
adjustment functions. Any fees in connection with such
policies that are not yet collected at the time of the
transfer shall be payable to the approved insurance
providers assuming the policies. The transfer process for
policies for the 1997 crop year with sales closing dates
before January 1, 1997, shall begin at the time of the
Secretary's announcement under clause (iii) and be completed
by the sales closing date for the crop and county. The
transfer process for all subsequent policies (including
policies for the 1998 and subsequent crop years) shall begin
at a date that permits the process to be completed not later
than 45 days before the sales closing date.
(5) Administrative fee
(A) Basic fee
Each producer shall pay an administrative fee for
catastrophic risk protection in an amount equal to 10 percent of
the premium for the catastrophic risk protection or $100 per
crop per county, whichever is greater, as determined by the
Corporation.
(B) Payment on behalf of producers
(i) Payment authorized
If State law permits a licensing fee or other payment to
be paid by an insurance provider to a cooperative
association or trade association and rebated to a producer
with catastrophic risk protection or additional coverage, a
cooperative association or trade association located in that
State may pay, on behalf of a member of the association in
that State or a contiguous State who consents to be insured
under such an arrangement, all or a portion of the
administrative fee required by this paragraph for
catastrophic risk protection.
(ii) Treatment of licensing fees
A licensing fee or other payment made by an insurance
provider to the cooperative association or trade association
in connection with the issuance of catastrophic risk
protection or additional coverage to members of the
cooperative association or trade association shall be
subject to the laws regarding rebates of the State in which
the fee or other payment is made.
(iii) Selection of provider
Nothing in this subparagraph limits the option of a
producer to select the licensed insurance agent or other
approved insurance provider from whom the producer will
purchase a policy or plan of insurance or to refuse coverage
for which a payment is offered to be made under clause (i).
(iv) Delivery of insurance
A policy or plan of insurance for which a payment is
made under clause (i) shall be delivered by a licensed
insurance agent or other approved insurance provider.
(v) Additional coverage encouraged
A cooperative association or trade association, and any
approved insurance provider with whom a licensing fee or
other arrangement under this subparagraph is made, shall
encourage producer members to purchase appropriate levels of
additional coverage in order to meet the risk management
needs of the member producers.
(vi) Report
Not later than April 1, 2002, the Secretary shall submit
to the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture, Nutrition,
and Forestry of the Senate a report that evaluates--
(I) the operation of this subparagraph; and
(II) the impact of this subparagraph on
participation in the Federal crop insurance program,
including the impact on levels of coverage purchased.
(C) Time for payment
The administrative fee required by this paragraph shall be
paid by the producer on the date that premium for a policy of
additional coverage would be paid by the producer.
(D) Use of fees
(i) In general
The amounts paid under this paragraph shall be deposited
in the crop insurance fund established under section 1516(c)
of this title, to be available for the programs and
activities of the Corporation.
(ii) Limitation
No funds deposited in the crop insurance fund under this
subparagraph may be used to compensate an approved insurance
provider or agent for the delivery of services under this
subsection.
(E) Waiver of fee
The Corporation shall waive the amounts required under this
paragraph for limited resource farmers, as defined by the
Corporation.
(6) Participation requirement
A producer may obtain catastrophic risk coverage for a crop of
the producer on land in the county only if the producer obtains the
coverage for the crop on all insurable land of the producer in the
county.
(7) Eligibility for Department programs
(A) In general
Effective for the spring-planted 1996 and subsequent crops
(and fall-planted 1996 crops at the option of the Secretary), to
be eligible for any payment or loan under the Agricultural
Market Transition Act [7 U.S.C. 7201 et seq.], for the
conservation reserve program, or for any benefit described in
section 2008f of this title, a person shall--
(i) obtain at least the catastrophic level of insurance
for each crop of economic significance in which the person
has an interest; or
(ii) provide a written waiver to the Secretary that
waives any eligibility for emergency crop loss assistance in
connection with the crop.
(B) ``Crop of economic significance'' defined
As used in this paragraph, the term ``crop of economic
significance'' means a crop that has contributed, or is expected
to contribute, 10 percent or more of the total expected value of
all crops grown by the producer.
(8) Limitation due to risk
The Corporation may limit catastrophic risk coverage in any
county or area, or on any farm, on the basis of the insurance risk
concerned.
(9) Transitional coverage for 1995 crops
Effective only for a 1995 crop planted or for which insurance
attached prior to January 1, 1995, the Corporation shall allow
producers of the crops until not later than the end of the 180-day
period beginning on the date of enactment of the Federal Crop
Insurance Reform Act of 1994 [Oct. 13, 1994] to obtain catastrophic
risk protection for the crop. On enactment of such Act, a producer
who made timely purchases of a crop insurance policy before the date
of enactment of such Act, under the provisions of this chapter then
in effect, shall be eligible for the same benefits to which a
producer would be entitled under comparable additional coverage
under subsection (c) of this section.
(10) Simplification
(A) Catastrophic risk protection plans
In developing and carrying out the policies and procedures
for a catastrophic risk protection plan under this chapter, the
Corporation shall, to the maximum extent practicable, minimize
the paperwork required and the complexity and costs of
procedures governing applications for, processing, and servicing
of the plan for all parties involved.
(B) Other plans
To the extent that the policies and procedures developed
under subparagraph (A) may be applied to other plans of
insurance offered under this chapter without jeopardizing the
actuarial soundness or integrity of the crop insurance program,
the Corporation shall apply the policies and procedures to the
other plans of insurance within a reasonable period of time (as
determined by the Corporation) after the effective date of this
paragraph.
(11) Loss adjustment
The rate for reimbursing an approved insurance provider or agent
for expenses incurred by the approved insurance provider or agent
for loss adjustment in connection with a policy of catastrophic risk
protection shall not exceed 8 percent of the premium for
catastrophic risk protection that is used to define loss ratio.
(c) General coverage levels
(1) Additional coverage generally
(A) In general
The Corporation shall offer to producers of agricultural
commodities grown in the United States plans of crop insurance
that provide additional coverage.
(B) Purchase
To be eligible for additional coverage, a producer must
apply to an approved insurance provider for purchase of
additional coverage if the coverage is available from an
approved insurance provider. If additional coverage is
unavailable privately, the Corporation may offer additional
coverage plans of insurance directly to producers.
(2) Transfer of relevant information
If a producer has already applied for catastrophic risk
protection at the local office of the Department and elects to
purchase additional coverage, the relevant information for the crop
of the producer shall be transferred to the approved insurance
provider servicing the additional coverage crop policy.
(3) Yield and loss basis
A producer shall have the option of purchasing additional
coverage based on an individual yield and loss basis or on an area
yield and loss basis, if both options are offered by the
Corporation.
(4) Level of coverage
The level of coverage shall be dollar denominated and may be
purchased at any level not to exceed 85 percent of the individual
yield or 95 percent of the area yield (as determined by the
Corporation). Not later than the beginning of the 1996 crop year,
the Corporation shall provide producers with information on
catastrophic risk and additional coverage in terms of dollar
coverage (within the allowable limits of coverage provided in this
paragraph).
(5) Expected market price
(A) Establishment or approval
For the purposes of this chapter, the Corporation shall
establish or approve the price level (referred to in this
chapter as the ``expected market price'') of each agricultural
commodity for which insurance is offered.
(B) General rule
Except as otherwise provided in subparagraph (C), the
expected market price of an agricultural commodity shall be not
less than the projected market price of the agricultural
commodity, as determined by the Corporation.
(C) Other authorized approaches
The expected market price of an agricultural commodity--
(i) may be based on the actual market price of the
agricultural commodity at the time of harvest, as determined
by the Corporation;
(ii) in the case of revenue and other similar plans of
insurance, may be the actual market price of the
agricultural commodity, as determined by the Corporation;
(iii) in the case of cost of production or similar plans
of insurance, shall be the projected cost of producing the
agricultural commodity, as determined by the Corporation; or
(iv) in the case of other plans of insurance, may be an
appropriate amount, as determined by the Corporation.
(6) Price elections
(A) In general
Subject to subparagraph (B), insurance coverage shall be
made available to a producer on the basis of any price election
that equals or is less than the price election established by
the Corporation. The coverage shall be quoted in terms of
dollars per acre.
(B) Minimum price elections
The Corporation may establish minimum price elections below
which levels of insurance shall not be offered.
(C) Wheat classes and malting barley
The Corporation shall, as the Corporation determines
practicable, offer producers different price elections for
classes of wheat and malting barley (including contract prices
in the case of malting barley), in addition to the standard
price election, that reflect different market prices, as
determined by the Corporation. The Corporation shall, as the
Corporation determines practicable, offer additional coverage
for each class determined under this subparagraph and charge a
premium for each class that is actuarially sound.
(7) Fire and hail coverage
For levels of additional coverage equal to 65 percent or more of
the recorded or appraised average yield indemnified at 100 percent
of the expected market price, or an equivalent coverage, a producer
may elect to delete from the additional coverage any coverage
against damage caused by fire and hail if the producer obtains an
equivalent or greater dollar amount of coverage for damage caused by
fire and hail from an approved insurance provider. On written notice
of the election to the company issuing the policy providing
additional coverage and submission of evidence of substitute
coverage on the commodity insured, the premium of the producer shall
be reduced by an amount determined by the Corporation to be
actuarially appropriate, taking into account the actuarial value of
the remaining coverage provided by the Corporation. In no event
shall the producer be given credit for an amount of premium
determined to be greater than the actuarial value of the protection
against losses caused by fire and hail that is included in the
additional coverage for the crop.
(8) State premium subsidies
The Corporation may enter into an agreement with any State or
agency of a State under which the State or agency may pay to the
approved insurance provider an additional premium subsidy to further
reduce the portion of the premium paid by producers in the State.
(9) Limitations on additional coverage
The Board may limit the availability of additional coverage
under this subsection in any county or area, or on any farm, on the
basis of the insurance risk involved. The Board shall not offer
additional coverage equal to less than 50 percent of the recorded or
appraised average yield indemnified at 100 percent of the expected
market price, or an equivalent coverage.
(10) Administrative fee
(A) Fee required
If a producer elects to purchase coverage for a crop at a
level in excess of catastrophic risk protection, the producer
shall pay an administrative fee for the additional coverage of
$30 per crop per county.
(B) Use of fees; waiver
Subparagraphs (D) and (E) of subsection (b)(5) of this
section shall apply with respect to the collection and use of
administrative fees under this paragraph.
(d) Premiums
(1) Premiums required
The Corporation shall fix adequate premiums for all the plans of
insurance of the Corporation at such rates as the Board determines
are actuarially sufficient to attain an expected loss ratio of not
greater than 1.1 through September 30, 1998, and not greater than
1.075 after October 1, 1998.
(2) Premium amounts
The premium amounts for catastrophic risk protection under
subsection (b) of this section and additional coverage under
subsection (c) of this section shall be fixed as follows:
(A) In the case of catastrophic risk protection, the amount
of the premium shall be sufficient to cover anticipated losses
and a reasonable reserve.
(B) In the case of additional coverage equal to or greater
than 50 percent of the recorded or appraised average yield
indemnified at not greater than 100 percent of the expected
market price, or a comparable coverage for a policy or plan of
insurance that is not based on individual yield, the amount of
the premium shall--
(i) be sufficient to cover anticipated losses and a
reasonable reserve; and
(ii) include an amount for operating and administrative
expenses, as determined by the Corporation, on an industry-
wide basis as a percentage of the amount of the premium used
to define loss ratio.
(3) Performance-based discount
The Corporation may provide a performance-based premium discount
for a producer of an agricultural commodity who has good insurance
or production experience relative to other producers of that
agricultural commodity in the same area, as determined by the
Corporation.
(e) Payment of portion of premium by Corporation
(1) In general
For the purpose of encouraging the broadest possible
participation of producers in the catastrophic risk protection
provided under subsection (b) of this section and the additional
coverage provided under subsection (c) of this section, the
Corporation shall pay a part of the premium in the amounts provided
in accordance with this subsection.
(2) Amount of payment
Subject to paragraph (4), the amount of the premium to be paid
by the Corporation shall be as follows:
(A) In the case of catastrophic risk protection, the amount
shall be equivalent to the premium established for catastrophic
risk protection under subsection (d)(2)(A) of this section.
(B) In the case of additional coverage equal to or greater
than 50 percent, but less than 55 percent, of the recorded or
appraised average yield indemnified at not greater than 100
percent of the expected market price, or a comparable coverage
for a policy or plan of insurance that is not based on
individual yield, the amount shall be equal to the sum of--
(i) 67 percent of the amount of the premium established
under subsection (d)(2)(B)(i) of this section for the
coverage level selected; and
(ii) the amount determined under subsection
(d)(2)(B)(ii) of this section for the coverage level
selected to cover operating and administrative expenses.
(C) In the case of additional coverage equal to or greater
than 55 percent, but less than 65 percent, of the recorded or
appraised average yield indemnified at not greater than 100
percent of the expected market price, or a comparable coverage
for a policy or plan of insurance that is not based on
individual yield, the amount shall be equal to the sum of--
(i) 64 percent of the amount of the premium established
under subsection (d)(2)(B)(i) of this section for the
coverage level selected; and
(ii) the amount determined under subsection
(d)(2)(B)(ii) of this section for the coverage level
selected to cover operating and administrative expenses.
(D) In the case of additional coverage equal to or greater
than 65 percent, but less than 75 percent, of the recorded or
appraised average yield indemnified at not greater than 100
percent of the expected market price, or a comparable coverage
for a policy or plan of insurance that is not based on
individual yield, the amount shall be equal to the sum of--
(i) 59 percent of the amount of the premium established
under subsection (d)(2)(B)(i) of this section for the
coverage level selected; and
(ii) the amount determined under subsection
(d)(2)(B)(ii) of this section for the coverage level
selected to cover operating and administrative expenses.
(E) In the case of additional coverage equal to or greater
than 75 percent, but less than 80 percent, of the recorded or
appraised average yield indemnified at not greater than 100
percent of the expected market price, or a comparable coverage
for a policy or plan of insurance that is not based on
individual yield, the amount shall be equal to the sum of--
(i) 55 percent of the amount of the premium established
under subsection (d)(2)(B)(i) of this section for the
coverage level selected; and
(ii) the amount determined under subsection
(d)(2)(B)(ii) of this section for the coverage level
selected to cover operating and administrative expenses.
(F) In the case of additional coverage equal to or greater
than 80 percent, but less than 85 percent, of the recorded or
appraised average yield indemnified at not greater than 100
percent of the expected market price, or a comparable coverage
for a policy or plan of insurance that is not based on
individual yield, the amount shall be equal to the sum of--
(i) 48 percent of the amount of the premium established
under subsection (d)(2)(B)(i) of this section for the
coverage level selected; and
(ii) the amount determined under subsection
(d)(2)(B)(ii) of this section for the coverage level
selected to cover operating and administrative expenses.
(G) Subject to subsection (c)(4) of this section, in the
case of additional coverage equal to or greater than 85 percent
of the recorded or appraised average yield indemnified at not
greater than 100 percent of the expected market price, or a
comparable coverage for a policy or plan of insurance that is
not based on individual yield, the amount shall be equal to the
sum of--
(i) 38 percent of the amount of the premium established
under subsection (d)(2)(B)(i) of this section for the
coverage level selected; and
(ii) the amount determined under subsection
(d)(2)(B)(ii) of this section for the coverage level
selected to cover operating and administrative expenses.
(3) Premium reduction
If an approved insurance provider determines that the provider
may provide insurance more efficiently than the expense
reimbursement amount established by the Corporation, the approved
insurance provider may reduce, subject to the approval of the
Corporation, the premium charged the insured by an amount
corresponding to the efficiency. The approved insurance provider
shall apply to the Corporation for authority to reduce the premium
before making such a reduction, and the reduction shall be subject
to the rules, limitations, and procedures established by the
Corporation.
(4) Prohibition on continuous coverage
Notwithstanding paragraph (2), during each of the 2001 and
subsequent reinsurance years, additional coverage under subsection
(c) of this section shall be available only in 5 percent increments
beginning at 50 percent of the recorded or appraised average yield.
(5) Premium payment disclosure
Each policy or plan of insurance under this chapter shall
prominently indicate the dollar amount of the portion of the premium
paid by the Corporation.
(f) Eligibility
(1) In general
To participate in catastrophic risk protection coverage under
this section, a producer shall submit an application at the local
office of the Department or to an approved insurance provider.
(2) Sales closing date
(A) In general
For coverage under this chapter, each producer shall
purchase crop insurance on or before the sales closing date for
the crop by providing the required information and executing the
required documents. Subject to the goal of ensuring actuarial
soundness for the crop insurance program, the sales closing date
shall be established by the Corporation to maximize convenience
to producers in obtaining benefits under price and production
adjustment programs of the Department.
(B) Established dates
Except as provided in subparagraph (C), the Corporation
shall establish, for an insurance policy for each insurable crop
that is planted in the spring, a sales closing date that is 30
days earlier than the corresponding sales closing date that was
established for the 1994 crop year.
(C) Exception
If compliance with subparagraph (B) results in a sales
closing date for an agricultural commodity that is earlier than
January 31, the sales closing date for that commodity shall be
January 31 beginning with the 2000 crop year.
(3) Records and reporting
To obtain catastrophic risk protection under subsection (b) of
this section or additional coverage under subsection (c) of this
section, a producer shall--
(A) provide annually records acceptable to the Secretary
regarding crop acreage, acreage yields, and production for each
agricultural commodity insured under this chapter or accept a
yield determined by the Corporation; and
(B) report acreage planted and prevented from planting by
the designated acreage reporting date for the crop and location
as established by the Corporation.
(g) Yield determinations
(1) In general
Subject to paragraph (2), the Corporation shall establish crop
insurance underwriting rules that ensure that yield coverage, as
specified in this subsection, is provided to eligible producers
obtaining catastrophic risk protection under subsection (b) of this
section or additional coverage under subsection (c) of this section.
(2) Yield coverage plans
(A) Actual production history
Subject to subparagraph (B), the yield for a crop shall be
based on the actual production history for the crop, if the crop
was produced on the farm without penalty during each of the 4
crop years immediately preceding the crop year for which actual
production history is being established, building up to a
production data base for each of the 10 consecutive crop years
preceding the crop year for which actual production history is
being established.
(B) Assigned yield
If the producer does not provide satisfactory evidence of
the yield of a commodity under subparagraph (A), the producer
shall be assigned--
(i) a yield that is not less than 65 percent of the
transitional yield of the producer (adjusted to reflect
actual production reflected in the records acceptable to the
Corporation for continuous years), as specified in
regulations issued by the Corporation based on production
history requirements; or
(ii) a yield determined by the Corporation, in the case
of--
(I) a producer that has not had a share of the
production of the insured crop for more than two crop
years, as determined by the Secretary;
(II) a producer that produces an agricultural
commodity on land that has not been farmed by the
producer; or
(III) a producer that rotates a crop produced on a
farm to a crop that has not been produced on the farm.
(C) Area yield
The Corporation may offer a crop insurance plan based on an
area yield that allows an insured producer to qualify for an
indemnity if a loss has occurred in an area (as specified by the
Corporation) in which the farm of the producer is located. Under
an area yield plan, an insured producer shall be allowed to
select the level of area production at which an indemnity will
be paid consistent with such terms and conditions as are
established by the Corporation.
(D) Commodity-by-commodity basis
A producer may choose between individual yield or area yield
coverage or combined coverage, if available, on a commodity-by-
commodity basis.
(3) Transitional yields for producers of feed or forage
(A) In general
If a producer does not provide satisfactory evidence of a
yield under paragraph (2)(A), the producer shall be assigned a
yield that is at least 80 percent of the transitional yield
established by the Corporation (adjusted to reflect the actual
production history of the producer) if the Secretary determines
that--
(i) the producer grows feed or forage primarily for on-
farm use in a livestock, dairy, or poultry operation; and
(ii) over 50 percent of the net farm income of the
producer is derived from the operation.
(B) Yield calculation
The Corporation shall--
(i) for the first year of participation of a producer,
provide the assigned yield under this paragraph to the
producer of feed or forage; and
(ii) for the second year of participation of the
producer, apply the actual production history or assigned
yield requirement, as provided in this subsection.
(C) Termination of authority
The authority provided by this paragraph shall terminate on
the date that is 3 years after the effective date of this
paragraph.
(4) Adjustment in actual production history to establish
insurable yields
(A) Application
This paragraph shall apply whenever the Corporation uses the
actual production records of the producer to establish the
producer's actual production history for an agricultural
commodity for any of the 2001 and subsequent crop years.
(B) Election to use percentage of transitional yield
If, for one or more of the crop years used to establish the
producer's actual production history of an agricultural
commodity, the producer's recorded or appraised yield of the
commodity was less than 60 percent of the applicable
transitional yield, as determined by the Corporation, the
Corporation shall, at the election of the producer--
(i) exclude any of such recorded or appraised yield; and
(ii) replace each excluded yield with a yield equal to
60 percent of the applicable transitional yield.
(C) Premium adjustment
In the case of a producer that makes an election under
subparagraph (B), the Corporation shall adjust the premium to
reflect the risk associated with the adjustment made in the
actual production history of the producer.
(5) Adjustment to reflect increased yields from successful
pest control efforts
(A) Situations justifying adjustment
The Corporation shall develop a methodology for adjusting
the actual production history of a producer when each of the
following apply:
(i) The producer's farm is located in an area where
systematic, area-wide efforts have been undertaken using
certain operations or measures, or the producer's farm is a
location at which certain operations or measures have been
undertaken, to detect, eradicate, suppress, or control, or
at least to prevent or retard the spread of, a plant disease
or plant pest, including a plant pest (as defined in section
7759 \1\ of this title).
---------------------------------------------------------------------------
\1\ See References in Text note below.
---------------------------------------------------------------------------
(ii) The presence of the plant disease or plant pest has
been found to adversely affect the yield of the agricultural
commodity for which the producer is applying for insurance.
(iii) The efforts described in clause (i) have been
effective.
(B) Adjustment amount
The amount by which the Corporation adjusts the actual
production history of a producer of an agricultural commodity
shall reflect the degree to which the success of the systematic,
area-wide efforts described in subparagraph (A), on average,
increases the yield of the commodity on the producer's farm, as
determined by the Corporation.
(h) Submission of policies and materials to Board
(1) In general
In addition to any standard forms or policies that the Board may
require be made available to producers under subsection (c) of this
section, a person (including an approved insurance provider, a
college or university, a cooperative or trade association, or any
other person) may prepare for submission or propose to the Board--
(A) other crop insurance policies and provisions of
policies; and
(B) rates of premiums for multiple peril crop insurance
pertaining to wheat, soybeans, field corn, and any other crops
determined by the Secretary.
(2) Submission of policies
A policy or other material submitted to the Board under this
subsection may be prepared without regard to the limitations
contained in this chapter, including the requirements concerning the
levels of coverage and rates and the requirement that a price level
for each commodity insured must equal the expected market price for
the commodity as established by the Board.
(3) Review and approval by the Board
A policy or other material submitted to the Board under this
subsection shall be reviewed by the Board and, if the Board finds
that the interests of producers are adequately protected and that
any premiums charged to the producers are actuarially appropriate,
shall be approved by the Board for reinsurance and for sale by
approved insurance providers to producers as an additional choice at
actuarially appropriate rates and under appropriate terms and
conditions. The Corporation may enter into more than 1 reinsurance
agreement with the approved insurance provider simultaneously to
facilitate the offering of the new policies.
(4) Guidelines for submission and review
The Corporation shall issue regulations to establish guidelines
for the submission, and Board review, of policies or other material
submitted to the Board under this subsection. At a minimum, the
guidelines shall ensure the following:
(A) Confidentiality
(i) In general
A proposal submitted to the Board under this subsection
(including any information generated from the proposal)
shall be considered to be confidential commercial or
financial information for the purposes of section 552(b)(4)
of title 5.
(ii) Standard of confidentiality
If information concerning a proposal could be withheld
by the Secretary under the standard for privileged or
confidential information pertaining to trade secrets and
commercial or financial information under section 552(b)(4)
of title 5, the information shall not be released to the
public.
(iii) Application
This subparagraph shall apply with respect to a proposal
only during the period preceding any approval of the
proposal by the Board.
(B) Personal presentation
The Board shall provide an applicant with the opportunity to
present the proposal to the Board in person if the applicant so
desires.
(C) Notification of intent to disapprove
(i) Time period
The Board shall provide an applicant with notification
of intent to disapprove a proposal not later than 30 days
prior to making the disapproval.
(ii) Modification of application
(I) Authority
An applicant that receives the notification may
modify the application, and such application, as
modified, shall be considered by the Board in the manner
provided in subparagraph (D) within the 30-day period
beginning on the date the modified application is
submitted.
(II) Time period
Clause (i) shall not apply to the Board's
consideration of the modified application.
(iii) Explanation
Any notification of intent to disapprove a policy or
other material submitted under this subsection shall be
accompanied by a complete explanation as to the reasons for
the Board's intention to deny approval.
(D) Determination to approve or disapprove policies or materials
(i) Time period
Not later than 120 days after a policy or other material
is submitted under this subsection, the Board shall make a
determination to approve or disapprove the policy or
material.
(ii) Explanation
Any determination by the Board to disapprove any policy
or other material shall be accompanied by a complete
explanation of the reasons for the Board's decision to deny
approval.
(iii) Failure to meet deadline
Notwithstanding any other provision of this chapter, if
the Board fails to make a determination within the
prescribed time period, the submitted policy or other
material shall be deemed approved by the Board for the
initial reinsurance year designated for the policy or
material, unless the Board and the applicant agree to an
extension.
(5) Premium schedule
(A) Payment by Corporation
In the case of a policy or plan of insurance developed and
approved under this subsection or section 1522 of this title, or
conducted under section 1523 of this title (other than a policy
or plan of insurance applicable to livestock), the Corporation
shall pay a portion of the premium of the policy or plan of
insurance that is equal to--
(i) the percentage, specified in subsection (e) of this
section for a similar level of coverage, of the total amount
of the premium used to define loss ratio; and
(ii) an amount for administrative and operating expenses
determined in accordance with subsection (k)(4) of this
section.
(B) Transitional schedule
Effective only during the 2001 reinsurance year, in the case
of a policy or plan of insurance developed and approved under
this subsection or section 1522 of this title, or conducted
under section 1523 of this title (other than a policy or plan of
insurance applicable to livestock), and first approved by the
Board after June 20, 2000, the payment by the Corporation of a
portion of the premium of the policy may not exceed the dollar
amount that would otherwise be authorized under subsection (e)
of this section (consistent with subsection (c)(5) of this
section, as in effect on the day before June 20, 2000).
(6) Additional prevented planting policy coverage
(A) In general
Beginning with the 1995 crop year, the Corporation shall
offer to producers additional prevented planting coverage that
insures producers against losses in accordance with this
paragraph.
(B) Approved insurance providers
Additional prevented planting coverage shall be offered by
the Corporation through approved insurance providers.
(C) Timing of loss
A crop loss shall be covered by the additional prevented
planting coverage if--
(i) crop insurance policies were obtained for--
(I) the crop year the loss was experienced; and
(II) the crop year immediately preceding the year of
the prevented planting loss; and
(ii) the cause of the loss occurred--
(I) after the sales closing date for the crop in the
crop year immediately preceding the loss; and
(II) before the sales closing date for the crop in
the year in which the loss is experienced.
(i) Adoption of rates and coverages
(1) In general
The Corporation shall adopt, as soon as practicable, rates and
coverages that will improve the actuarial soundness of the insurance
operations of the Corporation for those crops that are determined to
be insured at rates that are not actuarially sound, except that no
rate may be increased by an amount of more than 20 percent over the
comparable rate of the preceding crop year.
(2) Review of rating methodologies
To maximize participation in the Federal crop insurance program
and to ensure equity for producers, the Corporation shall
periodically review the methodologies employed for rating plans of
insurance under this chapter consistent with section 1507(c)(2) of
this title.
(3) Analysis of rating and loss history
The Corporation shall analyze the rating and loss history of
approved policies and plans of insurance for agricultural
commodities by area.
(4) Premium adjustment
If the Corporation makes a determination that premium rates are
excessive for an agricultural commodity in an area relative to the
requirements of subsection (d)(2) of this section for that area,
then, for the 2002 crop year (and as necessary thereafter), the
Corporation shall make appropriate adjustments in the premium rates
for that area for that agricultural commodity.
(j) Claims for losses
(1) In general
Under rules prescribed by the Corporation, the Corporation may
provide for adjustment and payment of claims for losses. The rules
prescribed by the Corporation shall establish standards to ensure
that all claims for losses are adjusted, to the extent practicable,
in a uniform and timely manner.
(2) Denial of claims
(A) In general
Subject to subparagraph (B), if a claim for indemnity is
denied by the Corporation or an approved provider, an action on
the claim may be brought against the Corporation or Secretary
only in the United States district court for the district in
which the insured farm is located.
(B) Statute of limitations
A suit on the claim may be brought not later than 1 year
after the date on which final notice of denial of the claim is
provided to the claimant.
(3) Indemnification
The Corporation shall provide approved insurance providers with
indemnification, including costs and reasonable attorney fees
incurred by the approved insurance provider, due to errors or
omissions on the part of the Corporation.
(4) Marketing windows
The Corporation shall consider marketing windows in determining
whether it is feasible to require planting during a crop year.
(k) Reinsurance
(1) In general
Notwithstanding any other provision of this chapter, the
Corporation shall, to the maximum extent practicable, provide
reinsurance to insurers approved by the Corporation that insure
producers of any agricultural commodity under 1 or more plans
acceptable to the Corporation.
(2) Terms and conditions
The reinsurance shall be provided on such terms and conditions
as the Board may determine to be consistent with subsections (b) and
(c) of this section and sound reinsurance principles.
(3) Share of risk
The reinsurance agreements of the Corporation with the reinsured
companies shall require the reinsured companies to bear a sufficient
share of any potential loss under the agreement so as to ensure that
the reinsured company will sell and service policies of insurance in
a sound and prudent manner, taking into consideration the financial
condition of the reinsured companies and the availability of private
reinsurance.
(4) Rate
(A) In general
Except as provided in subparagraph (B), the rate established
by the Board to reimburse approved insurance providers and
agents for the administrative and operating costs of the
providers and agents shall not exceed--
(i) for the 1998 reinsurance year, 27 percent of the
premium used to define loss ratio; and
(ii) for each of the 1999 and subsequent reinsurance
years, 24.5 percent of the premium used to define loss
ratio.
(B) Proportional reductions
A policy of additional coverage that received a rate of
reimbursement for administrative and operating costs for the
1998 reinsurance year that is lower than the rate specified in
subparagraph (A)(i) shall receive a reduction in the rate of
reimbursement that is proportional to the reduction in the rate
of reimbursement between clauses (i) and (ii) of subparagraph
(A).
(C) Other reductions
Beginning with the 2002 reinsurance year, in the case of a
policy or plan of insurance approved by the Board that was not
reinsured during the 1998 reinsurance year but, had it been
reinsured, would have received a reduced rate of reimbursement
during the 1998 reinsurance year, the rate of reimbursement for
administrative and operating costs established for the policy or
plan of insurance shall take into account the factors used to
determine the rate of reimbursement for administrative and
operating costs during the 1998 reinsurance year, including the
expected difference in premium and actual administrative and
operating costs of the policy or plan of insurance relative to
an individual yield policy or plan of insurance and other
appropriate factors, as determined by the Corporation.
(5) Cost and regulatory reduction
Consistent with section 118 of the Federal Crop Insurance Reform
Act of 1994, and consistent with maintenance of program integrity,
prevention of fraud and abuse, the need for program expansion, and
improvement of quality of service to customers, the Board shall
alter program procedures and administrative requirements in order to
reduce the administrative and operating costs of approved insurance
providers and agents in an amount that corresponds to any reduction
in the reimbursement rate required under paragraph (4) during the 5-
year period beginning on October 13, 1994.
(6) Agency discretion
The determination of whether the Corporation is achieving, or
has achieved, corresponding administrative cost savings shall not be
subject to administrative review, and is wholly committed to agency
discretion within the meaning of section 701(a)(2) of title 5.
(7) Plan
The Corporation shall submit to Congress a plan outlining the
measures that will be used to achieve the reduction required under
paragraph (5). If the Corporation can identify additional cost
reduction measures, the Corporation shall describe the measures in
the plan.
(l) Optional coverages
The Corporation may offer specific risk protection programs,
including protection against prevented planting, wildlife depredation,
tree damage and disease, and insect infestation, under such terms and
conditions as the Board may determine, except that no program may be
undertaken if insurance for the specific risk involved is generally
available from private companies.
(m) Quality loss adjustment coverage
(1) Effect of coverage
If a policy or plan of insurance offered under this chapter
includes quality loss adjustment coverage, the coverage shall
provide for a reduction in the quantity of production of the
agricultural commodity considered produced during a crop year, or a
similar adjustment, as a result of the agricultural commodity not
meeting the quality standards established in the policy or plan of
insurance.
(2) Additional quality loss adjustment
(A) Producer option
Notwithstanding any other provision of law, in addition to
the quality loss adjustment coverage available under paragraph
(1), the Corporation shall offer producers the option of
purchasing quality loss adjustment coverage on a basis that is
smaller than a unit with respect to an agricultural commodity
that satisfies each of the following:
(i) The agricultural commodity is sold on an identity-
preserved basis.
(ii) All quality determinations are made solely by the
Federal agency designated to grade or classify the
agricultural commodity.
(iii) All quality determinations are made in accordance
with standards published by the Federal agency in the
Federal Register.
(iv) The discount schedules that reflect the reduction
in quality of the agricultural commodity are established by
the Secretary.
(B) Basis for adjustment
Under this paragraph, the Corporation shall set the quality
standards below which quality losses will be paid based on the
variability of the grade of the agricultural commodity from the
base quality for the agricultural commodity.
(3) Review of criteria and procedures
(A) Review
The Corporation shall contract with a qualified person to
review the quality loss adjustment procedures of the Corporation
so that the procedures more accurately reflect local quality
discounts that are applied to agricultural commodities insured
under this chapter.
(B) Procedures
Effective beginning not later than the 2004 reinsurance
year, based on the review, the Corporation shall make
adjustments in the procedures, taking into consideration the
actuarial soundness of the adjustment and the prevention of
fraud, waste, and abuse.
(4) Quality of agricultural commodities delivered to
warehouse operators
In administering this chapter, the Secretary shall accept, in
the same manner and under the same terms and conditions, evidence of
the quality of agricultural commodities delivered to--
(A) warehouse operators that are licensed under the United
States Warehouse Act (7 U.S.C. 241 et seq.);
(B) warehouse operators that--
(i) are licensed under State law; and
(ii) have entered into a storage agreement with the
Commodity Credit Corporation; and
(C) warehouse operators that--
(i) are not licensed under State law but are in
compliance with State law regarding warehouses; and
(ii) have entered into a commodity storage agreement
with the Commodity Credit Corporation.
(n) Limitation on multiple benefits for same loss
(1) In general
Except as provided in paragraph (2), if a producer who is
eligible to receive benefits under catastrophic risk protection
under subsection (b) of this section is also eligible to receive
assistance for the same loss under any other program administered by
the Secretary, the producer shall be required to elect whether to
receive benefits under this chapter or under the other program, but
not both. A producer who purchases additional coverage under
subsection (c) of this section may also receive assistance for the
same loss under other programs administered by the Secretary, except
that the amount received for the loss under the additional coverage
together with the amount received under the other programs may not
exceed the amount of the actual loss of the producer.
(2) Exception
Paragraph (1) shall not apply to emergency loans under subtitle
C of the Consolidated Farm and Rural Development Act (7 U.S.C. 1961
et seq.).
(Feb. 16, 1938, ch. 30, title V, Sec. 508, 52 Stat. 74; June 22, 1938,
ch. 563, 52 Stat. 835; June 21, 1941, ch. 214, Secs. 3-7, 10, 55 Stat.
255, 256; Dec. 23, 1944, ch. 713, Secs. 1-3, 58 Stat. 918, 919; Aug. 1,
1947, ch. 440, Secs. 1-3, 61 Stat. 718; Aug. 25, 1949, ch. 512, Secs. 1-
3, 63 Stat. 663; Aug. 13, 1953, ch. 431, 67 Stat. 575; Pub. L. 85-111,
July 23, 1957, 71 Stat. 309; Pub. L. 86-131, Aug. 4, 1959, 73 Stat. 278;
Pub. L. 88-589, Sept. 12, 1964, 78 Stat. 933; Pub. L. 96-365, title I,
Secs. 105, 106, 107(b), Sept. 26, 1980, 94 Stat. 1314, 1315, 1317; Pub.
L. 100-387, title II, Sec. 208(a), Aug. 11, 1988, 102 Stat. 941; Pub. L.
101-624, title XXII, Secs. 2203-2205, Nov. 28, 1990, 104 Stat. 3955-
3957; Pub. L. 102-237, title VI, Sec. 601(4), (5), Dec. 13, 1991, 105
Stat. 1878; Pub. L. 103-66, title XIV, Sec. 1403(b)(1), (2), Aug. 10,
1993, 107 Stat. 333, 334; Pub. L. 103-354, title I, Sec. 106, Oct. 13,
1994, 108 Stat. 3183; Pub. L. 104-127, title I, Secs. 193(a)(1), (2),
(c), (d), (f), 195, Apr. 4, 1996, 110 Stat. 943-946; Pub. L. 105-185,
title V, Secs. 532, 534, June 23, 1998, 112 Stat. 581, 583; Pub. L. 105-
277, div. A, Sec. 101(a) [title VIII, Sec. 803(a)], Oct. 21, 1998, 112
Stat. 2681, 2681-38; Pub. L. 106-113, div. B, Sec. 1000(a)(5) [title II,
Secs. 205(a), 206], Nov. 29, 1999, 113 Stat. 1536, 1501A-294; Pub. L.
106-224, title I, Secs. 101-103(b)(1), (c), (d), 104-107, 123, 124(a),
144-146, 161, 162, June 20, 2000, 114 Stat. 360-368, 378, 391, 392, 395;
Pub. L. 107-171, title X, Secs. 10001-10003, May 13, 2002, 116 Stat.
486.)
References in Text
The Department of Agriculture Reorganization Act of 1994, referred
to in subsec. (a)(3)(B)(ii)(I), is title II of Pub. L. 103-354, Oct. 13,
1994, 108 Stat. 3209, as amended. Subtitle H of the Act is classified
principally to subchapter VIII (Sec. 6991 et seq.) of chapter 98 of this
title. For complete classification of this Act to the Code, see Tables.
The Agricultural Market Transition Act, referred to in subsec.
(b)(7)(A), is title I of Pub. L. 104-127, Apr. 4, 1996, 110 Stat. 896,
which is classified principally to chapter 100 (Sec. 7201 et seq.) of
this title. For complete classification of this Act to the Code, see
References in Text note set out under section 7201 of this title and
Tables.
For the effective date of this paragraph, referred to in subsecs.
(b)(10)(B) and (g)(3)(C), as being Oct. 13, 1994, see Effective Date of
1994 Amendment note below.
Section 7759 of this title, referred to in subsec. (g)(5)(A)(i), was
amended by Pub. L. 106-224, title IV, Sec. 438(a)(3), June 20, 2000, 114
Stat. 454, and, as amended, no longer contains provisions defining the
term ``plant pest''. See section 7702 of this title.
Section 118 of the Federal Crop Insurance Reform Act of 1994,
referred to in subsec. (k)(5), is section 118 of Pub. L. 103-354, which
is set out as a note under section 1506 of this title.
The United States Warehouse Act, referred to in subsec. (m)(4)(A),
is part C of act Aug. 11, 1916, ch. 313, 39 Stat. 486, as amended, which
is classified generally to chapter 10 (Sec. 241 et seq.) of this title.
For complete classification of this Act to the Code, see Short Title
note set out under section 241 of this title and Tables.
The Consolidated Farm and Rural Development Act, referred to in
subsec. (n)(2), is title III of Pub. L. 87-128, Aug. 8, 1961, 75 Stat.
307, as amended. Subtitle C of the Act is classified generally to
subchapter III (Sec. 1961 et seq.) of chapter 50 of this title. For
complete classification of this Act to the Code, see Short Title note
set out under section 1921 of this title and Tables.
Amendments
2002--Subsec. (a)(2). Pub. L. 107-171, Sec. 10001, substituted ``,
potatoes, and sweet potatoes'' for ``and potatoes''.
Subsec. (e)(4). Pub. L. 107-171, Sec. 10002, substituted
``Prohibition'' for ``Temporary prohibition'' in heading and ``and
subsequent reinsurance years'' for ``through 2005 reinsurance years'' in
text.
Subsec. (m)(3). Pub. L. 107-171, Sec. 10003(1), designated first
sentence of par. (3) as subpar. (A) and inserted heading and designated
second sentence of par. (3) as subpar. (B), inserted heading, and
substituted ``Effective beginning not later than the 2004 reinsurance
year, based on'' for ``Based on'' in text.
Subsec. (m)(4). Pub. L. 107-171, Sec. 10003(2), added par. (4).
2000--Subsec. (a)(3). Pub. L. 106-224, Sec. 123, added par. (3) and
struck out heading and text of former par. (3). Text read as follows:
``Insurance provided under this subsection shall not cover losses due
to--
``(A) the neglect or malfeasance of the producer;
``(B) the failure of the producer to reseed to the same crop in
such areas and under such circumstances as it is customary to
reseed; or
``(C) the failure of the producer to follow good farming
practices (as determined by the Secretary).''
Subsec. (a)(3)(C). Pub. L. 106-224, Sec. 161, added subpar. (C).
Subsec. (a)(5). Pub. L. 106-224, Sec. 144, designated existing
provisions as subpar. (A) and inserted heading, redesignated former
subpars. (A) and (B) as cls. (i) and (ii), respectively, and realigned
their margins, and added subpar. (B).
Subsec. (a)(7). Pub. L. 106-224, Sec. 145, added par. (7).
Subsec. (a)(8). Pub. L. 106-224, Sec. 162, added par. (8).
Subsec. (b)(3). Pub. L. 106-224, Sec. 103(a), added par. (3) and
struck out heading and text of former par. (3). Text read as follows:
``A producer shall have the option of basing the catastrophic coverage
of the producer on an individual yield and loss basis or on an area
yield and loss basis, if both options are offered by the Corporation.''
Subsec. (b)(5)(A). Pub. L. 106-224, Sec. 103(b)(1)(A), substituted
``$100'' for ``$50''.
Subsec. (b)(5)(B). Pub. L. 106-224, Sec. 103(b)(1)(B), (c), added
subpar. (B) and struck out heading and text of former subpar. (B). Text
read as follows: ``In addition to the amount required under subparagraph
(A), the producer shall pay a $10 fee for each amount determined under
subparagraph (A).''
Subsec. (b)(5)(C). Pub. L. 106-224, Sec. 103(b)(1)(C), substituted
``administrative fee required by this paragraph'' for ``amounts required
under subparagraphs (A) and (B)''.
Subsec. (b)(11). Pub. L. 106-224, Sec. 103(d), substituted ``8
percent'' for ``11 percent''.
Subsec. (c)(5). Pub. L. 106-224, Sec. 101(a), added par. (5) and
struck out heading and text of former par. (5). Text read as follows:
``The Corporation shall establish a price level for each commodity on
which insurance is offered that--
``(A) shall not be less than the projected market price for the
commodity (as determined by the Corporation); or
``(B) at the discretion of the Corporation, may be based on the
actual market price at the time of harvest (as determined by the
Corporation).''
Subsec. (c)(10). Pub. L. 106-224, Sec. 104, added par. (10) and
struck out former par. (10), which required administrative fee where
producer elected to purchase additional coverage for crop at level that
was less than 65 percent of recorded or appraised average yield
indemnified at 100 percent of expected market price, or equivalent
coverage, and provided for exception to fee if producer elected to
purchase additional coverage for crop equal to 65 percent or more of
recorded or appraised average yield indemnified at 100 percent of
expected market price, or equivalent coverage, additional fee if
producer elected to purchase additional coverage for crop equal to or
exceeding 65 percent of recorded or appraised average yield and 100
percent of expected market price or equivalent coverage, and for deposit
of fees.
Subsec. (d)(2)(B), (C). Pub. L. 106-224, Sec. 101(b)(1), added
subpar. (B) and struck out former subpars. (B) and (C), which described
premium amounts in the case of additional coverage below, equal to, or
greater than 65 percent of the recorded or appraised average yield
indemnified at 100 percent of the expected market price, or an
equivalent coverage.
Subsec. (d)(3). Pub. L. 106-224, Sec. 101(b)(2), added par. (3).
Subsec. (e)(2). Pub. L. 106-224, Sec. 101(c)(1), substituted
``Subject to paragraph (4), the amount'' for ``The amount'' in
introductory provisions.
Subsec. (e)(2)(B) to (G). Pub. L. 106-224, Sec. 101(c)(2), added
subpars. (B) to (G) and struck out former subpars. (B) and (C), which
set forth amount of premium to be paid by Corporation in the case of
coverage below, equal to, or greater than 65 percent of the recorded or
appraised average yield indemnified at 100 percent of the expected
market price, or an equivalent coverage.
Subsec. (e)(4). Pub. L. 106-224, Sec. 101(d), added par. (4) and
struck out former par. (4), which authorized Corporation to allow
approved providers to offer insurance plan to producers that would
combine both individual and area yield coverage at a premium rate
determined under certain conditions.
Subsec. (e)(5). Pub. L. 106-224, Sec. 101(e), added par. (5).
Subsec. (f)(3)(A). Pub. L. 106-224, Sec. 124(a), added subpar. (A)
and struck out former subpar. (A) which read as follows: ``provide, to
the extent required by the Corporation, records acceptable to the
Corporation of historical acreage and production of the crops for which
the insurance is sought or accept a yield determined by the Corporation;
and''.
Subsec. (g)(2)(B). Pub. L. 106-224, Sec. 105(a), designated existing
provisions of subpar. (B) as cl. (i) and added cl. (ii).
Subsec. (g)(2)(D). Pub. L. 106-224, Sec. 101(f), struck out ``(as
provided in subsection (e)(4) of this section)'' after ``combined
coverage''.
Subsec. (g)(4), (5). Pub. L. 106-224, Sec. 105(b), added pars. (4)
and (5).
Subsec. (h)(1). Pub. L. 106-224, Sec. 146(a), inserted ``(including
an approved insurance provider, a college or university, a cooperative
or trade association, or any other person)'' after ``a person'' in
introductory provisions.
Subsec. (h)(2). Pub. L. 106-224, Sec. 102(a)(1), struck out at end
``In the case of such a policy, the payment by the Corporation of a
portion of the premium of the policy may not exceed the amount that
would otherwise be authorized under subsection (e) of this section.''
Subsec. (h)(3). Pub. L. 106-224, Sec. 146(b), inserted ``by approved
insurance providers'' after ``for sale'' in first sentence.
Subsec. (h)(4)(A). Pub. L. 106-224, Sec. 146(c)(1), added subpar.
(A) and struck out former subpar. (A) which read as follows: ``A
proposal submitted to the Board under this subsection shall be
considered as confidential commercial or financial information for
purposes of section 552(b)(4) of title 5 until approved by the Board. A
proposal disapproved by the Board shall remain confidential commercial
or financial information.''
Subsec. (h)(4)(B). Pub. L. 106-224, Sec. 146(c)(2), inserted subpar.
heading.
Subsec. (h)(4)(C), (D). Pub. L. 106-224, Sec. 146(c)(3), added
subpars. (C) and (D) and struck out former subpars. (C) and (D), which
required notice of intent to disapprove, provided that modification
would be considered an original application, and directed that specific
guidelines were to prescribe timely submission and consideration of
proposals.
Subsec. (h)(5). Pub. L. 106-224, Sec. 102(a)(2), added par. (5) and
struck out heading and text of former par. (5). Text read as follows:
``Any policy, provision of a policy, or rate approved under this
subsection shall be published as a notice in the Federal Register and
made available to all persons contracting with or reinsured by the
Corporation under the terms and conditions of the contract between the
Corporation and the person originally submitting the policy or other
material.''
Subsec. (h)(6) to (10). Pub. L. 106-224, Sec. 146(d), redesignated
par. (7) as (6) and struck out former pars. (6) which related to pilot
cost of production risk protection plan, (8) which related to pilot
program of assigned yields for new producers, (9) which related to
revenue insurance pilot program, and (10) which related to time limits
for response to submission of new policies.
Subsec. (i). Pub. L. 106-224, Sec. 106, designated existing
provisions as par. (1), inserted heading, and added pars. (2) to (4).
Subsec. (k)(4)(C). Pub. L. 106-224, Sec. 102(b), added subpar. (C).
Subsec. (m). Pub. L. 106-224, Sec. 107, added subsec. (m) and struck
out former subsec. (m), which authorized research, surveys, pilot
programs, and investigations relating to crop insurance and agriculture-
related risks and losses and required evaluation of pilot programs and
submission of reports, including recommendations with respect to
implementation of programs on a national basis.
1999--Subsec. (f)(2). Pub. L. 106-113, Sec. 1000(a)(5) [title II,
Sec. 206], designated existing provisions as subpar. (A), inserted
heading, struck out ``Beginning with the 1995 crop year, the Corporation
shall establish, for an insurance policy for each insurable crop that is
planted in the spring, a sales closing date that is 30 days earlier than
the corresponding sales closing date that was established for the 1994
crop year.'' after ``price and production adjustment programs of the
Department.'', and added subpars. (B) and (C).
Subsec. (h)(9)(A). Pub. L. 106-113, Sec. 1000(a)(5) [title II,
Sec. 205(a)], substituted ``1997 through 2001'' for ``1997, 1998, 1999,
and 2000''.
1998--Subsec. (b)(5). Pub. L. 105-185, Sec. 532(a), added par. (5)
and struck out heading and text of former par. (5) which, in subpar. (A)
required payment of $50 fee per crop per county up to a maximum of $200
per producer per county and $600 per producer for all counties, in
subpar. (B) directed crediting of fees up to $100 collected by USDA
offices to appropriations account, retention of fees up to $100
collected by approved insurance providers, and deposit of fees in excess
of $100 in crop insurance fund, and in subpar. (C) waived fee for
limited resource farmers as defined by Corporation.
Subsec. (b)(11). Pub. L. 105-185, Sec. 532(d), added par. (11).
Subsec. (c)(10)(A). Pub. L. 105-185, Sec. 532(b)(1), added subpar.
(A) and struck out heading and text of former subpar. (A). Text read as
follows: ``Except as otherwise provided in this paragraph, if a producer
elects to purchase additional coverage for a crop at a level that is
less than 65 percent of the recorded or appraised average yield
indemnified at 100 percent of the expected market price, or an
equivalent coverage, the producer shall pay an administrative fee for
the additional coverage. Subsection (b)(5) of this section shall apply
in determining the amount and use of the administrative fee or in
determining whether to waive the administrative fee.''
Subsec. (c)(10)(C). Pub. L. 105-185, Sec. 532(b)(2), substituted
``$20'' for ``$10'' in first sentence.
Subsec. (h)(10). Pub. L. 105-185, Sec. 534, added par. (10).
Subsec. (k)(4). Pub. L. 105-185, Sec. 532(c), added par. (4) and
struck out heading and text of former par. (4). Text read as follows:
``The rate established by the Board to reimburse approved insurance
providers and agents for the administrative and operating costs of the
providers and agents shall not exceed--
``(A) for the 1997 reinsurance year, 29 percent of the premium
used to define loss ratio;
``(B) for the 1998 reinsurance year, 28 percent of the premium
used to define loss ratio; and
``(C) for the 1999 reinsurance year, 27.5 percent of the premium
used to define loss ratio.''
Subsec. (n). Pub. L. 105-277 designated existing provisions as par.
(1), inserted heading, substituted ``Except as provided in paragraph
(2), if a producer'' for ``If a producer'', and added par. (2).
1996--Subsec. (a)(6)(D). Pub. L. 104-127, Sec. 193(c), added subpar.
(D).
Subsec. (b)(4)(C). Pub. L. 104-127, Sec. 193(a)(1), added subpar.
(C).
Subsec. (b)(7)(A). Pub. L. 104-127, Sec. 193(a)(2), added subpar.
(A) and struck out heading and text of former subpar. (A). Prior to
amendment, text read as follows: ``To be eligible for any price support
or production adjustment program, the conservation reserve program, or
any benefit described in section 2008f of this title, the producer must
obtain at least the catastrophic level of insurance for each crop of
economic significance grown on each farm in the county in which the
producer has an interest, if insurance is available in the county for
the crop.''
Subsec. (h)(9). Pub. L. 104-127, Sec. 195, added par. (9).
Subsec. (j)(4). Pub. L. 104-127, Sec. 193(d), added par. (4).
Subsec. (n). Pub. L. 104-127, Sec. 193(f), added subsec. (n).
1994--Pub. L. 103-354 amended section generally, substituting
present provisions for former provisions which related to: in subsec.
(a), authority to offer insurance; in subsec. (b), submission of
policies and materials to Board; in subsec. (c), actuarial soundness; in
subsec. (d), adoption of rates and coverages; in subsec. (e), premiums;
in subsec. (f), claims for losses; in subsec. (g), special rule for
cotton; in subsec. (h), reinsurance; in subsec. (i), application to
other areas; in subsec. (j), optional coverages; in subsec. (k),
research; in subsec. (l), crop insurance for dry edible beans; in
subsec. (m), information collection on crop insurance; and in subsec.
(n), area yield plan.
1993--Subsec. (h). Pub. L. 103-66, Sec. 1403(b)(1), substituted
fifth sentence for former fifth sentence which read as follows: ``The
Corporation shall also pay operating and administrative costs to
insurers of policies on which the Corporation provides reinsurance to
the same extent that such costs are covered by the Corporation on the
Corporation's policies of insurance.''
Subsec. (n). Pub. L. 103-66, Sec. 1403(b)(2), added subsec. (n).
1991--Subsec. (a). Pub. L. 102-237, Sec. 601(4), struck out par. (1)
designation.
Subsecs. (k) to (n). Pub. L. 102-237, Sec. 601(5), redesignated
subsecs. (l) to (n) as (k) to (m), respectively.
1990--Pub. L. 101-624, Sec. 2204(b)(1), inserted section catchline
and struck out ``To carry out the purposes of this chapter the
Corporation is authorized and empowered--'' before subsec. (a).
Subsec. (a). Pub. L. 101-624, Sec. 2205(1), inserted heading,
substituted ``the Corporation may insure'' for ``to insure'' in first
sentence, and inserted provisions relating to amount of insurance to be
provided in cases where Agricultural Stabilization and Conservation
Service has established adjusted yields, and provisions relating to
establishment of a price level for each commodity beginning with the
1992 crop year.
Subsecs. (b) to (d). Pub. L. 101-624, Sec. 2204(a)(1), (2), added
subsecs. (b) to (d) and redesignated subsecs. (b) to (d) as (e) to (g),
respectively.
Subsec. (e). Pub. L. 101-624, Sec. 2204(a)(1), (b)(2), redesignated
subsec. (b) as (e), inserted heading, and substituted ``The Corporation
may fix'' for ``To fix'' in par. (1). Former subsec. (e) redesignated
(h).
Subsec. (f). Pub. L. 101-624, Sec. 2204(a)(1), redesignated subsec.
(c) as (f). Former subsec. (f) redesignated (i).
Pub. L. 101-624, Sec. 2203(a), inserted heading, substituted ``The
Corporation may adjust and pay claims for losses as provided under
subsection (a) of this section'' for ``To adjust and pay claims for
losses'', and inserted after first sentence ``The rules prescribed by
the Board shall establish standards to ensure that all claims for losses
are adjusted to the extent practicable in a uniform and timely manner.''
Subsec. (g). Pub. L. 101-624, Sec. 2204(a)(1), (b)(3), redesignated
subsec. (d) as (g), inserted heading, and substituted ``the Corporation
may include'' for ``to include''. Former subsec. (g) redesignated (j).
Subsec. (h). Pub. L. 101-624, Sec. 2204(a)(1), redesignated subsec.
(e) as (h). Former subsec. (h) redesignated (k).
Pub. L. 101-624, Sec. 2203(b), inserted heading, substituted ``The
Corporation is directed'' for ``And directed'', and inserted sentence at
end relating to revision of reinsurance agreements beginning with the
1992 reinsurance year.
Subsec. (i). Pub. L. 101-624, Sec. 2204(a)(1), (b)(4), redesignated
subsec. (f) as (i), inserted heading, and substituted ``The Corporation
may provide'' for ``To provide''. Former subsec. (i) redesignated (l).
Subsec. (j). Pub. L. 101-624, Sec. 2204(a)(1), (b)(5), redesignated
subsec. (g) as (j), inserted heading, and substituted ``The Corporation
may offer'' for ``To offer''. Former subsec. (j) redesignated (m).
Subsec. (k). Pub. L. 101-624, Sec. 2205(2), struck out subsec. (k)
which set out a special rule for calculating premiums and indemnities,
with respect to insuring timber and forest yields.
Pub. L. 101-624, Sec. 2204(a)(1), (b)(6), redesignated subsec. (h)
as (k), inserted heading, and substituted ``The Corporation may
include'' for ``To include''.
Subsec. (l). Pub. L. 101-624, Sec. 2204(a)(1), (b)(7), redesignated
subsec. (i) as (l), inserted heading, substituted ``The Corporation may
conduct'' for ``To conduct'', and struck out second and third sentences
which read as follows: ``Beginning in the 1981 crop year and ending
after the 1985 crop year, the Corporation shall also conduct a pilot
program of individual risk underwriting of crop insurance in not less
than twenty-five counties. Under this pilot program, to the extent that
appropriate yield data are available, the Corporation shall make
available to producers in such counties crop insurance under this
chapter based on personalized rates and with guarantees determined from
the producer's actual yield history.''
Subsec. (m). Pub. L. 101-624, Sec. 2204(b)(8), added subsec. (m) and
struck out former subsec. (m) which read as follows: ``To accumulate,
prior to the 1989 crop year, sufficient actuarial data to enable the
Corporation to provide crop insurance that meets the differentiated
needs of producers of different types of dry edible beans. Commencing
with the 1989 crop year, the Corporation shall make such crop insurance
available to producers.''
Pub. L. 101-624, Sec. 2204(a)(1), redesignated subsec. (j) as (m).
Subsec. (n). Pub. L. 101-624, Sec. 2204(a)(3), added subsec. (n).
1988--Subsec. (j). Pub. L. 100-387 added subsec. (j).
1980--Subsec. (a). Pub. L. 96-365, Sec. 105, authorized Corporation,
if sufficient actuarial data is available, to insure producers of any
agricultural commodity grown in the United States under any plan of
insurance determined to be adapted to the commodity involved; defined
``field'' in the case of aquacultural species to mean the environment in
which the commodity is produced; in revising percentage limitations for
crop insurance coverage, prescribed 75 per centum protection for
recorded or appraised average yield (previously protected up to such
percentage), offered producers lesser levels of coverage including 50
per centum of recorded or appraised average yield as adjusted, barred
protection exceeding 75 per centum, offered price election approximating
(but not less than 90 per centum of) projected market price for
commodity involved, and struck out requirement for downward adjustment
of minimum percentage in yield which may be insured to reflect
investment in crop; and struck out limitations on Federal crop insurance
program which: limited crop insurance to not more than seven
agricultural commodities in 1948 and to not more than three additional
commodities yearly thereafter, beginning with 1954 crop authorized
yearly expansion of crop insurance program to not more than 150 counties
in addition to counties offered insurance the previous year, limited
reinsurance for private insurance companies to 20 counties, and required
counties selected by the Board for crop insurance to be representative
of areas where the commodity involved normally was produced; and struck
out general reinsurance provision, covered in subsec. (e) of this
section.
Subsec. (b). Pub. L. 96-365, Sec. 106(1), designated existing
provisions as par. (1), struck out ``in the agricultural commodity or in
cash,'' after ``premiums for insurance'' and proviso from first sentence
authorizing establishment of premiums on the basis of the parity or
comparable price for the commodity as determined and publish by
Secretary of Agriculture, or on the basis of an average market price
designated by the Board and second sentence providing for collection of
premiums at such time or times, or for securing in such manner, as the
Board may determine, which is covered in par. (4), required the rates to
be actuarially sufficient, added pars. (2) and (3), incorporated
existing provision in par. (4), and added pars. (5) and (6).
Subsec. (c). Pub. L. 96-365, Sec. 106(2), struck out ``in the
agricultural commodity or in cash,'' after ``claims for losses'' and
provisions respecting: determination of indemnities on same price basis
as premiums were determined for the crop with respect to which the
indemnities were paid; requirement that the Corporation post annually
for each county at the county courthouse a list of indemnities paid for
losses on farms in the county; action on claims in any court of the
State having general jurisdiction, sitting in the county where the
insured farm was located; and jurisdiction of district courts without
regard to amount in controversy.
Subsec. (d). Pub. L. 96-365, Sec. 106(3), redesignated subsec. (e)
as (d) and struck out prior subsec. (d) authorizing Corporation to
purchase, handle, store, insure, provide storage facilities for, and
sell agricultural commodities.
Subsec. (e). Pub. L. 96-365, Sec. 106(4), added subsec. (e). Former
subsec. (e) redesignated (d).
Subsec. (f). Pub. L. 96-365, Sec. 106(4), substituted provisions for
insurance and reinsurance in the territories and possessions for prior
provision for reinsurance in Puerto Rico when not available from
recognized private sources.
Subsecs. (g), (h). Pub. L. 96-365, Sec. 106(4), added subsecs. (g)
and (h).
Subsec. (i). Pub. L. 96-365, Sec. 107(b), added subsec. (i).
1964--Subsec. (a). Pub. L. 88-589 increased from 100 to 150 the
number of counties into which the Federal crop insurance program may be
extended.
1959--Subsec. (a). Pub. L. 86-131 struck out provision prohibiting
Federal crop insurance in a county unless two hundred farms or one third
of the farms normally producing the commodity apply for such insurance,
excluding farms refused insurance on the basis of risk involved.
1957--Subsec. (f). Pub. L. 85-111 added subsec. (f).
1953--Subsec. (a). Act Aug. 13, 1953, authorized extension of
Federal crop insurance program into an additional 100 counties, struck
out commodity formula basis on which this expansion may take place, and
provided an exception to the strict county limitation by providing that
producers on farms situated in a local producing area bordering on a
county with a crop insurance program may be included in that county's
program.
1949--Subsec. (a). Act Aug. 25, 1949, Sec. 1, provided for an annual
increase in number of counties in which insurance now offered by
Corporation can be issued.
Subsec. (b). Act Aug. 25, 1949, Sec. 2, struck out provision under
which Corporation's administrative expenses are restricted, after the
crop year 1949, to a sum equivalent to 25 percent of the premiums
collected in the preceding year.
Subsec. (c). Act Aug. 25, 1949, Sec. 3, struck out provision which
required prorating of losses beginning with crop year 1950.
1947--Subsec. (a). Act Aug. 1, 1947, Sec. 1, amended subsec. (a)
generally, and among other changes, provided for crop insurance,
commencing with crops planted for harvest in 1948, made provision for
reinsurance, enumerated specific crops insurable in 1948, provided for
additional crops in subsequent years, limited number of counties in
which certain crops were insurable, increased required number of
applications in any one county from fifty to two hundred, and authorized
Board to refuse insurance in any county where agricultural commodity to
be insured constitutes an unimportant part of total agricultural income.
Subsec. (b). Act Aug. 1, 1947, Sec. 2, inserted proviso relating to
basis for premiums.
Subsec. (c). Act Aug. 1, 1947, Sec. 3, inserted first proviso
relating to determination of price basis for indemnities.
1944--Subsec. (a). Act Dec. 23, 1944, Sec. 1, amended subsec. (a)
generally to provide insurance against loss not only for wheat and
cotton crops but also for flax, corn, oats, etc.
Subsec. (b). Act Dec. 23, 1944, Sec. 2, provided for the
establishment of such rates as would cover crop losses and build up a
reasonable reserve, and inserted proviso.
Subsec. (c). Act Dec. 23, 1944, Sec. 3, inserted first proviso, and
inserted ``and received'' after ``mailed to'' in last proviso.
1941--Subsec. (a). Act June 21, 1941, Secs. 3-5, struck out comma
after ``1939'' and inserted ``and with the cotton crop planted for
harvest in 1942'', and substituted ``producers of the agricultural
commodity against loss in yields of the agricultural commodity'' for
``producers of wheat against loss in yields of wheat'' in the first
sentence, and ``the agricultural commodity'' for ``wheat'' in the third
sentence, respectively.
Subsecs. (b), (c). Act June 21, 1941, Sec. 6, substituted ``the
agricultural commodity'' for ``wheat'' wherever appearing.
Subsec. (d). Act June 21, 1941, Secs. 6, 10, substituted ``the
agricultural commodity'' for ``wheat'' wherever appearing, and inserted
second sentence.
Subsec. (e). Act June 21, 1941, Sec. 7, added subsec. (e).
1938--Subsec. (a). Act June 22, 1938, inserted second proviso in
first sentence.
Effective Date of 2000 Amendment
Amendment by sections 101(a)-(c), 102(a), 103(a), (b)(1), (c), 104,
105(b), and 162 of Pub. L. 106-224 applicable beginning with the 2001
crop of an agricultural commodity, amendment by sections 101(d), 102(b),
and 103(d) of Pub. L. 106-224 applicable beginning with the 2001
reinsurance year, amendment by sections 101(e), (f), 105(a), 106, 107,
123, 124(a), 144, 145, and 161 of Pub. L. 106-224 effective June 20,
2000, and amendment by section 146 of Pub. L. 106-224 effective Oct. 1,
2000, see section 171 of Pub. L. 106-224, set out as a note under
section 1501 of this title.
Effective Date of 1998 Amendment
Amendment by Pub. L. 105-185 effective July 1, 1998, see section 537
of Pub. L. 105-185, set out as a note under section 1506 of this title.
Effective Date of 1994 Amendment
Amendment by Pub. L. 103-354 effective Oct. 13, 1994, and applicable
to provision of crop insurance under Federal Crop Insurance Act (7
U.S.C. 1501 et seq.) beginning with 1995 crop year, with such Act, as in
effect on the day before Oct. 13, 1994, to continue to apply with
respect to 1994 crop year, see section 120 of Pub. L. 103-354, set out
as a note under section 1502 of this title.
Effective Date of 1993 Amendment
Amendment by Pub. L. 103-66 effective Oct. 1, 1993, see section
1403(c) of Pub. L. 103-66, set out as a note under section 1506 of this
title.
Effective Date of 1980 Amendment
Section 105 of Pub. L. 96-365 provided that the amendment made by
that section is effective with respect to 1981 and subsequent crops.
Section 106 of Pub. L. 96-365 provided that the amendment made by
that section is effective with respect to 1981 and subsequent crops.
Amendment by section 107(b) of Pub. L. 96-365 effective Sept. 26,
1980, see section 112 of Pub. L. 96-365, set out as a note under section
1504 of this title.
Transfer of Functions
Administration of program of Federal Crop Insurance Corporation
transferred to Secretary of Agriculture by 1946 Reorg. Plan No. 3,
Sec. 501, eff. July 16, 1946, 11 F.R. 7877, 60 Stat. 1100. See note set
out under section 1503 of this title.
Wartime consolidation of Federal Crop Insurance Corporation into
Agricultural Conservation and Adjustment Administration, see note set
out under section 1503 of this title.
Expansion of Crop Insurance Pilots
Pub. L. 106-113, div. B, Sec. 1000(a)(5) [title II, Sec. 205(b)],
Nov. 29, 1999, 113 Stat. 1536, 1501A-294, provided that: ``In the case
of any pilot program offered under the Federal Crop Insurance Act [7
U.S.C. 1501 et seq.] that was approved by the Board of Directors of the
Federal Crop Insurance Corporation on or before September 30, 1999, the
pilot program may be offered on a regional, whole State, or national
basis for the 2000 and 2001 crop years notwithstanding section 553 of
title 5, United States Code.''
Limitation on Fee for Catastrophic Risk Protection
Pub. L. 105-277, div. A, Sec. 101(a) [title VII, Sec. 748], Oct. 21,
1998, 112 Stat. 2681, 2681-32, as amended by Pub. L. 106-224, title I,
Sec. 103(b)(2), June 20, 2000, 114 Stat. 364, provided that:
``Notwithstanding the provisions of section 508(b)(5)(A) of the Federal
Crop Insurance Act (7 U.S.C. 1508(b)(5)(A)), for the 1999 reinsurance
and subsequent reinsurance years, no producer shall pay more than $100
per crop per county as an administrative fee for catastrophic risk
protection under section 508(b)(5)(A) of the Act.''
Special Rule for 1996 Crop Year Regarding Catastrophic Risk Protection
Insurance
Section 193(a)(3) of Pub. L. 104-127 provided that:
``(A) Effective period.--This paragraph shall apply only to the 1996
crop year.
``(B) Availability.--During a period of not less than 2 weeks, but
not more than 4 weeks, beginning on the date of enactment of this title
[Apr. 4, 1996], the Secretary shall provide producers with an
opportunity to obtain catastrophic risk protection insurance under
section 508(b) of the Federal Crop Insurance Act (7 U.S.C. 1508(b)) for
a spring-planted crop, and limited additional coverage for malting
barley under the Malting Barley Price and Quality Endorsement. The
Federal Crop Insurance Corporation may attach such limitations and
restrictions on obtaining insurance during this period as the
Corporation considers necessary to maintain the actuarial soundness of
the crop insurance program.
``(C) Attachment.--Insurance coverage under any policy obtained
under this paragraph during the extended sales period shall not attach
until 10 days after the application.
``(D) Cancellation.--During the extended period, a producer may
cancel a catastrophic risk protection policy if--
``(i) the policy is a continuation of a policy that was obtained
for a previous crop year; and
``(ii) the cancellation request is made before the acreage
reporting date for the policy for the 1996 crop year.''
Crop Insurance Pilot Program
Section 193(b) of Pub. L. 104-127 provided that:
``(1) Coverage.--The Secretary of Agriculture shall develop and
administer a pilot project for crop insurance coverage that indemnifies
crop losses due to a natural disaster such as insect infestation or
disease.
``(2) Actuarial soundness.--A pilot project under this paragraph
shall be actuarially sound, as determined by the Secretary and
administered at no net cost.
``(3) Duration.--A pilot project under this paragraph shall be of
two years' duration.''
Prevented Planting
Section 116 of Pub. L. 103-354 provided that:
``(a) In General.--Effective for the 1994 crop year, a producer
described in subsection (b) shall receive compensation under the
prevented planting coverage policy provision described in subsection
(b)(1) by--
``(1) obtaining from the Secretary of Agriculture the applicable
amount that is payable under the conserving use program described in
subsection (b)(4); and
``(2) obtaining from the Federal Crop Insurance Corporation the
amount that is equal to the difference between--
``(A) the amount that is payable under the conserving use
program; and
``(B) the amount that is payable under the prevented
planting coverage policy.
``(b) Eligible Producers.--Subsection (a) shall apply to a producer
who--
``(1) purchased a prevented planting policy for the 1994 crop
year from the Federal Crop Insurance Corporation prior to the spring
sales closing date for the 1994 crop year;
``(2) is unable to plant a crop due to major, widespread
flooding in the Midwest, or excessive ground moisture, that occurred
prior to the spring sales closing date for the 1994 crop year;
``(3) had a reasonable expectation of planting a crop on the
prevented planting acreage for the 1994 crop year; and
``(4) participates in a conserving use program established for
the 1994 crop of wheat, feed grains, upland cotton, or rice
established under section 107B(c)(1)(E), 105B(c)(1)(E),
103B(c)(1)(D), or 101B(c)(1)(D), respectively, of the Agricultural
Act of 1949 ([former] 7 U.S.C. 1445b-3a(c)(1)(E), 1444f(c)(1)(E),
1444-2(c)(1)(D), or 1441-2(c)(1)(D)).
``(c) Oilseed Prevented Planting Payments.--
``(1) In general.--Effective for the 1994 crop year, a producer
of a crop of oilseeds (as defined in section 205(a) of the
Agricultural Act of 1949 ([former] 7 U.S.C. 1446f(a))) shall receive
a prevented planting payment for the crop if the requirements of
paragraphs (1), (2), and (3) of subsection (b) are satisfied.
``(2) Source of payment.--The total amount of payments required
under this subsection shall be made by the Federal Crop Insurance
Corporation.
``(d) Payment.--A payment under this section may not be made before
October 1, 1994.''
Report on Improving Dissemination of Crop Insurance Information
Section 117 of Pub. L. 103-354 provided that: ``Not later than 180
days after the date of enactment of this Act [Oct. 13, 1994] and at the
end of each of the 2 1-year periods thereafter, the Federal Crop
Insurance Corporation shall submit a report to Congress containing a
plan to implement a sound program for producer education regarding the
crop insurance program and for the dissemination of crop insurance
information to producers, as required by section 508(a)(5) of the
Federal Crop Insurance Act [7 U.S.C. 1508(a)(5)] (as amended by section
106).''
Federal Crop Insurance Commission
Pub. L. 100-546, Oct. 28, 1988, 102 Stat. 2730, provided for
establishment, membership, compensation, etc., of Commission for the
Improvement of the Federal Crop Insurance Program, directed Commission
to study and determine why participation in program had not reached
levels anticipated when Federal Crop Insurance Act of 1980 was enacted,
to identify States and commodities to which lack of participation in
program is most serious, and to prepare findings and recommendations
setting forth means by which participation in program could be increased
and natural protection for producers of agricultural commodities could
be improved, required Commission to submit an interim report to
Congressional committees and Secretary of Agriculture, not later than
Apr. 1, 1989, containing findings and recommendations for immediate
administrative improvement in program, aimed at improving program in
1990 sales year, and a final report, not later than July 1, 1989, to
include Commission's findings and recommendation and a status report on
improvement of program, authorized Commission to continue to monitor
program and to submit monthly reports beginning July 1, 1989, and ending
Dec. 31, 1990, and terminated Commission on Dec. 31, 1990.
Loss Adjustment Obligations
Pub. L. 100-203, title I, Sec. 1507, Dec. 22, 1987, 101 Stat. 1330-
29, provided that: ``It is the sense of Congress that, in carrying out
the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.), the Federal Crop
Insurance Corporation--
``(1) should not be required to assume 100 percent of all loss
adjustments in the Federal crop insurance program; and
``(2) should assume and perform the loss adjustment obligations
of a reinsured company if the Corporation determines that such
company's loss adjustment performance and practices are not carried
out in accordance with the applicable reinsurance agreement.''
Notice to Producers of Right To Elect Subsidized Crop Insurance or
Disaster Payments on 1981 Crops
Section 202 of Pub. L. 96-365 provided that: ``The Secretary of
Agriculture, after consultation with the Board of Directors of the
Federal Crop Insurance Corporation, shall, at least sixty days prior to
the beginning of the planting of the 1981 crops of wheat, feed grains,
upland cotton, and rice, or thirty days after the date of enactment of
this Act [Sept. 26, 1980], whichever is the later, notify producers of
those commodities of their right to elect, with respect to the 1981
crop, between (1) declaring the farm acreage of the respective commodity
eligible for disaster payments under the Agricultural Act of 1949 [7
U.S.C. 1421 et seq.], or (2) covering such farm acreage with crop
insurance, part of the premium for which is paid by the Federal Crop
Insurance Corporation under the provisions of section 508(b)(3) or
508(e) of the Federal Crop Insurance Act [subsec. (b)(3) or (e) of this
section]. Such notice shall include a statement of the percent of crop
insurance premium that will be paid by the Corporation.''
Study of Alternative All-Risk, All-Crop Insurance Programs
Pub. L. 95-181, Sec. 2, Nov. 15, 1977, 91 Stat. 1373, provided that:
``The Secretary of Agriculture shall undertake an immediate study of
alternative programs which could be established for an all-risk, all-
crop insurance to help provide protection to those suffering crop losses
in floods, droughts, and other natural disasters, including alternative
methods of administration, Federal assistance, reinsurance, rate setting
and private insurance industry involvement, as well as variations on the
existing crop insurance program, and such other matters as he determines
are relevant, and shall report his findings and recommendations to the
President for transmission to the Congress by March 1, 1978. The
Secretary shall consult with the Secretary of Housing and Urban
Development on behalf of the Federal Insurance Administration; the
Secretary of Treasury and representatives of the private insurance
industry in the course of the study and shall identify the views of each
in forwarding his findings and recommendations to the President. Such
sums, not exceeding $200,000, as are appropriated for fiscal year 1978
under section 504 of the Federal Crop Insurance Act, as amended [section
1504 of this title], may be utilized to conduct such a study.''
Validity and Termination of Prior Insurance Contracts
Section 5 of act Aug. 1, 1947, provided: ``Nothing in this Act
[amending sections 1502, 1505 (a to d), 1506(d), 1507(d), and 1508 (a to
c) of this title] shall be construed to affect the validity of any
insurance contract entered into prior to the enactment of this Act [Aug.
1, 1947] insofar as such contract covers the 1947 crop year. Any such
contract which purports to cover a crop in the 1948 or a
