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Livestock Gross Margin Insurance

Protects against a decrease in margin caused by a drop in livestock prices or an increase in feed costs.

Product Overview

Understanding Livestock Gross Margin Insurance

Livestock Gross Margin (LGM) is a federal risk-management program designed to protect against a decrease in margin caused by a drop in livestock prices or an increase in feed costs. LGM can be a good fit for any farm size as it has no head limitations. This product continues to become more attractive with the addition of premium subsidies on cattle and swine, as well as a potential change to more frequent sales periods.

Benefits

Coverage is available on fed cattle, swine and dairy production (milk).
Simpler than using options or futures.
Similar to buying a put option on your livestock / production to be sold plus a call option to limit higher feed costs
Can sign up 12 times a year to insure all milk / livestock production expected to be marketed over a rolling 11-month insurance period
Coverage is subsidized based on deductible
Dairy, cattle and swine premiums are billed at the end of the endorsement period

Basic provisions

Based on futures prices
Producer prepares a Target Marketing Report
- Fed cattle: number in each month of the insurance period
- Swine: number in each month of the insurance period
- Dairy: target milk marketings and feed rations (best reflect actual production)
Insured at 100% share
Dairy/swine: in the 48 contiguous states
Fed cattle: specific states (including Farm Credit Services of America’s footprint)
Fed-cattle LGM is for calf and yearling finishing operations
Producer must submit a marketing report and sales receipts for actual marketings for each month within 15 days of receipt of notice of probable loss from the company

Available to all qualifying producers regardless of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, and marital or family status.

How does Livestock Gross Margin Coverage Work?

Application must be completed between 5 p.m. last Friday business day of the month and 8 p.m. the following evening
Choose a deductible:
- Fed cattle: $0-$150/head
- Swine: $0-$20/head
- Milk: $0-$2/cwt.
Insurance period:
- Fed cattle, dairy: 11 months
- Swine: 6 months
- Coverage begins in the second month
Gross Margin Guarantee – Actual Gross Margin = Indemnity

Are you covered?

We know crop insurance decisions can feel complicated. Our insurance officers have access to a tool that analyzes your numbers and local data to help you make the best decisions to meet your goals. Get started by completing the inquiry form and we’ll find a time that is convenient for you to meet with us.

Get Started

Why Work With Us for Livestock Insurance

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Dedicated Specialists

Our agents are non-commissioned and focus 100% of their time on crop insurance and livestock insurance — every working day of every week in the year. They don’t sell property, casualty or life insurance.