YEAR-END SUMMARY: ARPA PROMOTES ADDITIONAL COVERAGE AND REVENUE PROTECTION

WASHINGTON, Mar 7, 2002 - Producers increased their crop insurance coverage significantly in 2001 and bought higher levels of coverage due to increased premium subsidies. Although the total acres insured increased only slightly, total acres insured jumped more than 50 percent for coverages 75 percent and greater. The number of policies, acres, liability, and total premium all raised more than 40 percent over last year for coverages of at least 70 percent.

Producers, recognizing the volatility in commodity prices, also took advantage of the revenue coverage insurance plans during 2001. For the first time, producers paid more premium for revenue coverage than for strictly yield insurance plans. In fact, the revenue programs' number of policies, acres, liability, and total premium all grew more than 20 percent during 2001. Revenue insurance programs include: Crop Revenue Coverage (CRC), Revenue Assurance (RA), Income Protection (IP), Indexed Income Protection (IIP), Adjusted Gross Revenue (AGR), and Group Risk Insurance Plan (GRIP).

Much of this change is the direct result of Agricultural Risk Protection Act (ARPA) provisions. ARPA, passed in 2000, provides over $8 billion in crop insurance spending from 2001-2005. Under ARPA, premium subsidies increased and were fully applied to revenue products for the first time in 2001.

Related item: Revenue programs chart (PDF)