Vegetation index hay insurance program

A new risk management tool for pasture, rangeland and forage is now available for the 2007 crop year. This program allows livestock producers to purchase insurance protection for losses of forage produced for grazing or harvesting for hay. Insurance can be purchased for pasture-rangeland, or hayland-forage, or both.

The program may be purchased from crop insurance agents up until the November 30th sales deadline. Local insurance provid-ers who offer these programs are Bank West Insurance, Crew Agency, Eliason Company, Farm Bureau Financial Services, First National Agency and State Farm Insurance.

The vegetation index program is to allow maximum flexibility for the producer. Producers are not required to insure all their acres, for instance, but rather may elect to insure only those acres that are important to their grazing program or hay operation. Further, producers are not required to insure the acreage for the entire crop year. The crop year is divided into intervals and producers may elect to insure their acreage for only those intervals where the risk is the greatest.

"Insure it when you need it to be green, when you need the crop to be growing," said Rusty Olney of Crew Agency. "You will be insuring only those usable acres that you want to insure. And, if you have a loss in, say, the first interval, and then we get great rains in the second interval, you are paid no matter what happens in the second interval."

This pilot program is based on satellite imagery that determines the productivity of the acreage as a means to measure the density and health of the plants within a 4.8 mile by 4.8 mile grid that a producer insures for a chosen dollar amount. The program is to be tested in 16 South Dakota counties - Haakon, Bennett, Butte, Corson, Dewey, Harding, Jackson, Jones, Lyman, Meade, Mellette, Perkins, Shannon, Stanley, Todd and Ziebach.

"This new insurances tool will help farmers and ranchers, especially with operations located in drought impacted areas, to improve their risk management capabilities," said Agriculture Secretary Mike Johanns. "Designed to operate in a variety of range and pasture environments, these products utilize technology to determine when a producer has suffered a loss."

Development of the program was provided through provisions of the Agricultural Risk Protection Act of 2000, which established the development of a pasture, rangeland and forage program as one of Risk Management Agency's highest research and development priorities.

For more information, contact an insurance agent or visit http://www.rma.usda.gov/policies/pasturerangeforage/.