The Enhanced Coverage Option (ECO) provides additional area-based coverage for a portion of your underlying crop insurance policy deductible. It must be purchased as an endorsement to the Yield Protection (YP), Revenue Protection (RP), Revenue Protection with the Harvest Price Exclusion (RP HPE), Actual Production History (APH) or Yield-Based Dollar Amount of Insurance policy. ECO offers producers a choice of 90% or 95% trigger levels. Trigger means the percentage of expected yield or revenue at which a loss becomes payable.
How it Works…
ECO:
- ECO follows the coverage of insured’s underlying MPCI policy. If YP or a yield-based policy is chosen, then ECO covers yield loss. If an RP policy is chosen, then the ECO covers revenue losses. The amount of the ECO coverage depends on the liability of the underlying policy.
- ECO differs from the underlying policy in how a loss payment is triggered. The underlying policy pays a loss on an individual basis, and an indemnity is triggered when insured has an individual loss in yield or revenue.
- ECO pays a loss on an area basis, and an indemnity is triggered when there is a decrease in the county level yield or revenue. ECO has two trigger levels: 90% and 95%. ECO provides a band of coverage between the elected trigger level and 86%. If the county yield or revenue is reduced beyond the trigger level, insured will receive an ECO indemnity. If the reduction in yield or revenue exceeds the 86% threshold, insured will receive an indemnity equal to the full insured liability.
Availability
ECO is available for 31 crops (shown below) in most counties where these crops are grown. ECO and availability were introduced in 2021 and additional crops will be added in subsequent years based on producer interest and data availability.
*Wheat, Canola, Oats, Millet, Rice, Cotton, Cotton (e.g., Long Staple), Flax, Hybrid Sorghum Seed, Cigar Binder Tobacco, Popcorn, Dry Beans, Sugar Beets, Grain Sorghum, Corn, Sesame, Silage Sorghum, Hybrid Corn Seed, Peanuts, Sunflowers, Hybrid Seed Rice, Soybeans, Cultivated Wild Rice, Buckwheat, Flue Cured Tobacco, Fire Cured Tobacco, Burley Tobacco, Barley, Dark Air Tobacco, Safflower, Dry Peas
*Only for “spring” type counties.
