HR 5834 IH
102d CONGRESS
2d Session
 H. R. 5834
To amend the Federal Crop Insurance Act to modify the provisions governing
yield averages, to provide late planting and prevented planting coverage,
and to authorize higher levels of coverage.
IN THE HOUSE OF REPRESENTATIVES
August 12, 1992
Mr. EWING (for himself and Mr. JONTZ) introduced the following bill; which
was referred to the Committee on Agriculture
A BILL
To amend the Federal Crop Insurance Act to modify the provisions governing
yield averages, to provide late planting and prevented planting coverage,
and to authorize higher levels of coverage.
  Be it enacted by the Senate and House of Representatives of the United
  States of America in Congress assembled,
SECTION 1. SHORT TITLE.
  This Act may be cited as the `Federal Crop Insurance Fairness Act of 1992'.
SEC. 2. YIELD AVERAGES.
  Section 508A(b) of the Federal Crop Insurance Act (7 U.S.C. 1508a(b))
  is amended by adding at the end the following new paragraph:
  `(4) YIELD AVERAGES-
  `(A) IN GENERAL- Notwithstanding paragraphs (1) and (2) of this subsection,
  yield coverage under this section shall be based on the average of a
  producer's actual proven crop yields for a commodity over not less than
  4 crop years and not more than 10 crop years, as determined under this
  paragraph.
  `(B) ESTABLISHING A MINIMUM LEVEL OF INSURANCE PROTECTION- The Corporation
  shall establish a minimum level of insurance protection for those producers
  who have had reduced yields due to natural disasters.
  `(C) USE OF TRANSITIONAL OR ACTUAL YIELDS- A transitional yield may only
  be used to establish a yield for the producers on a farm to the extent the
  producers have not established actual production history for the first
  4 crop years the producers operate the farm. After producers establish
  actual production history for such 4 crop years, yield coverage under
  this section shall be based only on the actual production history for the
  commodity for the farm.
  `(D) USE OF YIELDS FOR PREVIOUS CROP YEARS- In the case of producers who
  operate a new parcel of land, for crop insurance purposes, the producers
  may elect to apply--
  `(i) the previous yield history for the land, if the Corporation determines
  the yield history to be actuarially sound; or
  `(ii) transitional yield data to the parcel of land.
  `(E) NONSTANDARD CLASSIFICATION SYSTEM- The Corporation shall make
  adjustments in the Nonstandard Classification System to account for producer
  yield declines due to recurrent natural disasters.
  `(F) TRANSITIONAL YIELD- For purposes of this paragraph, the term
  `transitional yield' means the countywide average used by the Corporation
  to establish a yield for a producer where there are no actual production
  records available.'.
SEC. 3. LATE PLANTING COVERAGE.
  Section 508 of the Federal Crop Insurance Act (7 U.S.C. 1508) is amended
  by adding at the end the following new subsection:
  `(n) LATE PLANTING COVERAGE-
  `(1) IN GENERAL- Producers on a farm entering into a crop insurance contract
  under this Act shall have late planting coverage that would permit planting
  after the final planting date for a commodity by up to 25 days for coverage
  under the contract.
  `(2) REDUCTION OF COVERAGE- If the producers on a farm utilize late planting
  coverage under paragraph (1), the yield guarantee shall be reduced by--
  `(A) 1 percent per day for each of the 1st through 10th days planting is
  delayed beyond the normal final planting date;
  `(B) 2 percent per day for each of the 11th through 25th days planting is
  delayed beyond the normal final planting date; and
  `(C) such other amounts as can be demonstrated to offset the additional
  insurer risk of providing the coverage.
  `(3) PRESUMPTION OF COVERAGE- The producers on a farm shall have late
  planting coverage as part of a basic policy of insurance under this Act
  unless the producers notify the Corporation that the producers waive late
  planting coverage.
  `(4) RAISES IN PREMIUMS- If the Corporation determines that late
  planting coverage would raise premiums to such an extent as to discourage
  participation in the program established by this Act, the Corporation
  shall offer late planting as a separate endorsement.'.
SEC. 4. PREVENTED PLANTING COVERAGE.
  Section 508 of the Federal Crop Insurance Act (7 U.S.C. 1508) (as amended
  by section 3) is further amended by adding at the end the following new
  subsection:
  `(o) PREVENTED PLANTING COVERAGE-
  `(1) IN GENERAL- Producers on a farm entering into a crop insurance contract
  under this Act shall have prevented planting coverage as part of the basic
  policy of insurance under this Act.
  `(2) COVERAGE- If the producers on a farm are prevented from planting a crop
  of a covered commodity as the result of excess moisture, or other natural
  disaster, as defined by the Corporation, the producers shall be eligible
  for coverage equal to 50 percent of the guaranteed level of coverage for
  the crop.
  `(3) SUBSTITUTE CROP- In prevented planting situations, the producers on
  a farm shall have the option of planting a substitute crop, in lieu of an
  insured crop, as part of the basic policy of insurance under this Act. The
  value of the substitute crop shall reduce the remaining guaranteed level
  of coverage for the insured crop as determined under paragraph (2).
  `(4) PRESUMPTION OF COVERAGE- The producers on a farm shall have prevented
  planting coverage as part of a basic policy of insurance under this Act
  unless the producers notify the Corporation that the producers waive
  prevented planting coverage.
  `(5) RAISES IN PREMIUMS- If the Corporation determines that prevented
  planting coverage would raise premiums to such an extent as to discourage
  participation in the program established by this Act, the Corporation
  shall offer prevented planting as a separate endorsement.'.
SEC. 5. LEVELS OF COVERAGE IN EXCESS OF 75 PERCENT OF RECORDED OR APPRAISED
AVERAGE YIELD.
  Section 508(a) of the Federal Crop Insurance Act (7 U.S.C. 1508) is amended--
  (1) in the ninth sentence, by striking `Except as provided in the preceding
  two sentences,' and inserting `Except as provided in the preceding three
  sentences,'; and
  (2) by inserting after the eighth sentence the following new sentence:
  `The Corporation may make available to producers in a growing area a level
  of coverage in excess of 75 percent of the recorded or appraised average
  yield, as adjusted, if the Corporation determines that normal variations
  in yield in that growing area have not resulted in the payment of claims
  for losses while the level of coverage is limited to 75 percent.'
SEC. 6. REPORT ON FEASIBILITY OF COVERAGE OF DE MINIMIS YIELDS.
  (a) REPORT REQUIRED- Not later than 180 days after the date of the enactment
  of this Act, the Federal Crop Insurance Corporation shall submit to the
  Committee on Agriculture of the House of Representatives and the Committee
  on Agriculture, Nutrition, and Forestry of the Senate a report--
  (1) describing the feasibility of providing de minimis yield coverage under
  the Federal Crop Insurance Act (7 U.S.C. 1501 et seq.) for producers of
  agricultural commodities grown in the United States; and
  (2) determining the actuarial impact of providing such coverage.
  (b) DE MINIMIS YIELD DEFINED- For purposes of this section, the term `de
  minimis yield' means a crop yield for which the estimated market value of
  the crop is less than the cost to the producer of harvesting the crop.