Margin Protection provides coverage against an unexpected decrease in operating margin (revenue less input costs). Margin Protection is area-based, using county-level estimates of average revenue and input costs to establish the amount of coverage and indemnity payments. Because Margin Protection is area-based (average for a county), it may not reflect your individual experience.
Margin Protection takes into considerations changes in crop prices, reductions of yields and changes in the prices of inputs used to grow the crop.
Margin Protection can be purchased by itself, or in conjunction with a Yield Protection or Revenue Protection policy purchased from the same Approved Insurance Provider that issued the Margin Protection policy. If you buy a Yield Protection or Revenue Protection policy, you will receive a Margin Protection premium credit to reflect that indemnity payments from one policy can offset payments from the other.
Margin Protection is available in select counties for corn, rice, soybeans, and wheat in the states listed below:
- Rice – Arkansas, California, Louisiana, Mississippi, Missouri and Texas
- Corn and Soybeans – Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota and Wisconsin
- Wheat – Minnesota, Montana, North Dakota and South Dakota
Margin Protection provides coverage that is based on an expected margin for each applicable crop, type, and practice.
Expected Margin = Expected Revenue – Expected Costs, where:
- Expected revenue (per acre) is the expected county yield multiplied by a projected commodity price; and
- Expected cost (per acre) is the dollar amount determined by multiplying the quantity of each allowed input by the input’s projected price.
You may choose coverage from 70 percent to 95 percent of your expected margin. A higher coverage level has a higher premium rate. The Catastrophic Risk Protection (CAT) coverage level is not available with MPP.
Changes Made to the Margin Protection Plan for 2018
- Coverage Levels expanded to 70%-95%
- Protection Factors are now offered from 0.80 to 1.20
- Harvest Price Option is now available
- The calculation of deductibles and trigger margins have been revised for easier use
- There has been a major pilot area expansion for corn and soybeans
Click here for more information on the Margin Protection Premium Estimator and Price Discovery tool. RMA’s Frequently Asked Questions on the Margin Protection Plan can by found by clicking here. Check out our Margin Protection infographic by clicking here.
Contact your local ProAg agent for more information. Come experience the ProAg difference today!
Not all coverages or products may be available in all jurisdictions. The description of coverage in these pages is for informational purposes only. Actual coverages will vary based on the terms and conditions of the policy issued. The information described herein does not amend, or otherwise affect, the terms and conditions of any insurance policy issued by ProAg or any of its subsidiaries.