Buying insurance isn’t fun, but can make a big difference

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storm damaged corn
Storm damaged corn.

Hello Again!

My oldest daughter finally got to experience purchasing her first vehicle. During this process, I think she finally understood the true meaning of sales tax and insurance.

The taxes she paid without blinking an eye; after all, it is just a one-time payment. But, insurance was a completely different ordeal, which for me, was highly entertaining! Insurance for a young driver without a multi-car, or homeowners discount can be a little harsh.

When she started her car shopping experience she was somewhat adamant that she did not want me to have anything to do with the selection or the purchase of her vehicle. I did, however mention, to her when looking at her monthly payment, that she would also need to budget in a monthly insurance premium. She responded with, “OK, how much is that”?

Different factors

I went on to explain that it varies based on the type of vehicle. Of course, since I am not very smart, she was sure that I didn’t understand her question, which she proceeded to repeat to me, very slowly.

I again explained that it varies and she should just call our insurance agent. I gave her the telephone number and told her to call for the information. My dear sweet daughter called me back a short 15 minutes later to “explain” to me how insurance works. She just couldn’t understand how it is fair to make a payment on something that you hope you will never have to use.

I laughed at her innocence and inexperience, and said yes, that is exactly what you do, you pay for something that can actually keep you out of a bad financial situation, but in reality you hope that you never have to file a claim.

Planning ahead

With this thought in mind that is the reason why the Farm Service Agency offers Noninsured Crop Disaster Assistance Program (NAP). This program can help you plan for the future, even when an unforeseen weather-related disaster strikes.

The deadline to enroll for this program is March 15, for 2016 NAP coverage on forage sorghum, oats, potatoes, Sunflowers and all spring planted specialty crops grown for food.

The 2014 farm bill provides greater coverage for losses when natural disasters affect specialty crops. Previously, the program offered coverage at 55 percent of the average market price for crop losses that exceed 50 percent of expected production.

Producers can now choose higher levels of coverage, up to 65 percent of their expected production at 100 percent of the average market price. The expanded protection is especially helpful to beginning and socially disadvantaged producers, as well as farmers with limited resources, who will receive fee waivers and premium reductions for expanded coverage.

Eligible producers can apply for 2016 NAP coverage at their local FSA Office using form CCC-471, Application for Coverage. The service fee for basic NAP coverage is the lesser of $250 per crop, or $750 per producer per administrative county, not to exceed a total of $1,875 for a producer with farming interest in multiple counties. Producers interested in buy-up coverage must pay a premium, in addition to the service fee. The maximum premium will be $6,564.

Meeting the definition

Producers meeting the definition of a socially disadvantaged farmer, beginning farmer or limited resource farmer will have service fees waived. Producers meeting this definition who choose to purchase buy-up coverage will also have service fees waived and the premium will be capped at $3,282.

To help producers learn more about the NAP program and how it can help them, USDA, offers an online Web tool at www.fsa.usda.gov/nap. The web tool allows producers to determine whether their crops are eligible for coverage and gives producers an opportunity to explore a variety of options and levels to determine the best protection level for their operation.

For more information on NAP coverage or obtain coverage, contact your FSA County office.

That’s all for now,
FSA Andy

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FSA Andy is written by USDA Farm Service Agency county executive directors in northeastern Ohio.

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