Manager’s Bulletin MGR-25-006, published on August 20, 2025, outlines changes included in the One Big Beautiful Bill Act (OBBBA). These changes include expanding benefits for beginning farmers and ranchers, increasing coverage options, and making crop insurance more affordable.

With this bulletin, the Risk Management Agency (RMA) is implementing sections 10303(b) (Area Risk Coverage and Supplemental Coverage Option interaction), 10501 (Beginning Farmer and Rancher Benefit), 10502 (Area-Based Crop Insurance Coverage and Affordability), and 10504 (Premium Support) of the OBBBA. All these changes apply to all policies with a sales closing date (SCD) on or after July 1, 2025. Separate guidance will be issued by RMA later regarding the implementation of additional changes based on legislation.

Below is more detailed information about each of the changes being implemented with this bulletin:

BEGINNING FARMER OR RANCHER (BFR) BENEFIT

The definition of a Beginning Farmer or Rancher (BFR) has been revised to allow individuals who have not actively operated and managed a farm or ranch in any state, with an insurable interest in a crop or livestock as an owner-operator, landlord, tenant, or sharecropper, for more than 10 crop years to qualify.

In addition to the existing BFR benefits, such as the additional 10 percent premium subsidy rate for up to 10 crop years, eligible BFRs will now receive enhanced premium support: an extra 5 percent for the first two crop years, 3 percent in the third year, and 1 percent in the fourth year.

Any producer whose BFR eligibility changes under this legislation may submit a new or amended BFR application by November 30, 2025, for benefits to apply to 2026 crop year policies with an SCD on or after July 1, 2025, and on or before November 30, 2025. For policies with an SCD after November 30, 2025, BFR applications must be submitted by the applicable SCD.

NOTE: The OBBBA did not change the definition of, or benefits associated with, a Veteran Farmer or Rancher (VFR). If a producer qualifies as both a BFR and VFR, the higher benefit will apply.

 

AREA-BASED CROP INSURANCE COVERAGE AND AFFORDABILITY, AND AREA RISK COVERAGE AND SUPPLEMENTAL COVERAGE OPTION (SCO) INTERACTION

  • Whole-Farm Revenue Protection (WFRP) – The maximum insurable coverage level under the WFRP policy is increasing from 85 percent to 90 percent. The 90 percent coverage level will carry the same premium subsidy rates as the 85 percent level.
  • SCO, ECO, MCO, HIP-WI, and FIP-SI – The premium subsidy rate for SCO is being raised from 65 percent to 80 percent. This enhanced subsidy also applies to coverages like SCO, including the Enhanced Coverage Option (ECO), the Margin Coverage Option (MCO), the Hurricane Insurance Protection – Wind Index (HIP-WI), and the Fire Insurance Protection-Smoke Index (FIP-SI).

NOTE: The SCO policy will be updated beginning with the year 2027 to increase the maximum coverage level from 86 percent to 90 percent. For the 2026 crop year, insureds may cover this band of insurance with ECO and will receive the new 80 percent premium subsidy rate on ECO coverage. This provision effectively allows producers to access SCO-equivalent coverage up to 90 percent level for the 2026 crop year.

  • Additional SCO Changes – Insureds can now purchase SCO coverage regardless of their Area Risk Coverage (ARC) elections with the Farm Service Agency. Additionally, insureds are no longer required to report acreage under which ARC is elected for their SCO policy.

PREMIUM SUPPORT

Premium subsidy rates for different insurance coverage and unit elections for policies that use the Common Crop Insurance Policy, Basic Provisions (CCIP) have been updated. Access MGR-25-006 to view the table or refer to the actuarial documents on RMA’s website.