Area Yield Protection

Under the AYP policy, the producer elects a coverage level (up to 90%) which is multiplied by the expected county yield to determine a trigger yield. An indemnity is due if the final county yield is less than the trigger yield. The producer elects a protection factor between 80% and 120% which allows them to insure more or less than the county average. That factor is multiplied by the expected county yield and projected price to determine the dollar amount of insurance per acre which is used to determine the indemnity payable. The projected price is based on the average of the closing price of a designated board of trade futures contract during a specified period of time prior to the planting of the crop.

Coverage Levels

The Coverage Level is used to calculate the Trigger Yield used to determine if an indemnity is due and ranges from 70% to 90% in 5% increments.  The insured may elect a different coverage level for each crop, type and practice.

Protection Factor

The producer elects a Protection Factor between 80% and 120% in 1% increments (unless otherwise specified in the Special Provisions).  This factor allows producers to purchase protection below, equal to or above the county average represented by the Expected County Yield.  The producer may elect a different Protection Factor for each crop, type and practice.