The definition of stress is when you see the ice pellets start hitting the ground in front of you, and you know they’re also pummeling your crop, stripping the leaves and the season’s potential.
Now that you can see that picture, rewind, and do something more than just a multi-peril policy to protect your income and tamp down your future stress.
Jason is a Nebraska farmer with a smart philosophy about coverage for wind and hail.
“When you have a corn yield goal of 250 bushels to the acre on a field, when you’re putting those kinds of inputs out there, you want to make sure you get a return on that investment. And in an irrigated situation particularly, the major thing that’s going to keep you from getting that yield is going to be wind and hail.”
Jason concedes disease can also get in the way, but for disease, you can scout and monitor, or proactively select the right hybrids to manage around it.
“The wind and hail policy protects my revenue stream. When you’re making the investment in the crop, you’re selling those bushels and locking in a margin. Hail and wind coverage is going to help ensure that you have a positive return on that investment.”
Jason insures at 120%. His thought is that if a field sustains ten or fifteen percent damage from a hailstorm, then it’s not going to get to the potential he fertilized for. It will still yield well, but with protection, he gets the return on his seed and fertilizer investment and protects his working capital.
“It helps you sleep at night when the storm’s coming.”
Sometimes producers wait until the storm season to place coverage, but Jason takes care of it while he’s making the rest of his crop insurance decisions.
“I make the decisions when I have more time to think about it and so typically with my agent, we pretty much have that wrapped up with in late February.”
Just last season, the insurance proved its value. Storms hit.
“What the hail and wind insurance is allowing me to do is continue to maintain my equipment line. When I look at my working capital before that season, and then after, basically I’m in the same place. It allows me to continue to operate and not have to worry about the shorter crop, because I had the right coverage. My yield goals are higher than my APH and so I’m going to push populations. The wind and hail insurance allows me to do that with confidence.”
Jason says he buys this coverage from Farm Credit Services of America for a couple reasons.
“Different policies offer different things. I think it’s important for growers to look at and know what’s covered and what isn’t and the one thing I feel with Farm Credit is they understand the policies and their goal is to try to get me the most value for that policy. And I think they’ve done an excellent job. You can get wind and hail insurance, but whether it’s a product that protects you the way you want to be protected is another thing. Where I’m at as far as land payments and meeting that positive revenue stream all the time, I can’t afford any setbacks. Because of that, I want to make sure if I do have a problem, it’s covered.”
Hail and wind policies complement your MPCI coverage to help you build a more holistic risk management plan. Together, this covers some gaps and provides stronger protection around your working capital. We can help you align your risk management dollars to get the best coverage for your farm.
