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Changes To Whole Farm Insurance May Increase Use

A lavander field.
Flickr (CC BY-SA 2.0)
There’s no individual lavender crop insurance policy in the United States. With Whole Farm insurance, lavander is covered. ";


Federal crop insurance is a safety net for many farmers and rural communities but it typically favors the big commodities like corn, soybeans, wheat and cotton. A few years ago, a new type of insurance emerged to cover everything grown or raised on a farm under one umbrella, even specialty crops like hemp and lavender that don’t have their own policies. It’s been slow to catch on but a few modifications may entice more farmers to get on board in 2020. 

Jeff Schahczenski, an economist with the Butte-based organization National Center for Appropriate Technology, says Whole Farm Revenue Protection insurance takes a very different approach to what most farmers are used to. Instead of an insurance policy focusing on a specific crop, Whole Farm protects the income generated by a farm.

“Basically it says to the farmer: Grow the combination of crops you would like to grow, that you think would be the most profitable to make a living,” Schahczenski said. 

Schahczenski says Whole Farm incentivizes people to diversify their operations. Farmers who grow more types of crops and raise livestock pay lower premiums.

He says not putting all your eggs in one basket makes good economic sense while also supporting better soil health, biodiversity and less dependence on chemical inputs.

This type of insurance is also really useful for producers who want to grow specialty crops.

“Production of lavender, interestingly, is kind of a hot thing around the country and people want to grow lavender. There’s no individual lavender policy in the United States,” Schahczenski said. 

With Whole Farm, lavender would be covered.

Schahczenski helped get Whole Farm authorized with the 2014 Farm Bill. It’s the first crop insurance policy available in every county nationwide, which is a big deal.

In Montana, for example, only eight counties have crop insurance for potatoes whereas all but two counties have it for wheat.

But the adoption of this new type of insurance has been relatively slow. Around 2,200 policies were sold in the U.S. last year, with fewer than 60 in Montana, according to AgriPulse.

Schahczenski says part of that is because it’s hard for people to change.

“It’s just so different that people say, ‘Oh, I don’t know. That just seems too weird. I don’t want to try it,’” Schahczenski said. 

He says getting Whole Farm also requires a little more paperwork, like turning in taxes which can make some people feel uncomfortable.

There have been some challenges with how coverage levels are determined, as well.

Farmers with Whole Farm can insure up to 85 percent of their average revenue. In the past, that average was based on the last five years. If one of those years had low yields due to something like drought or hail, that skewed the average and resulted in less coverage.

Schahczenski says deductibles will be lower this coming year and farmers will have the option of dropping a really bad year so the average more accurately reflects typical farm revenue.

He says more people may sign up now that the policy has been modified.

Doug Crabtree says being able to drop a bad year made a big difference. He uses the insurance policy for his 9,600-acre farm near Havre, where a small team grows 15 to 20 different small grains, pulses and oil seed crops.

“What we’re experiencing with climate change impacts, we’ve had insurance claims in two of the last five years. So when we did the math. If they hadn’t made that change, we probably would not have the policy today,” Crabtree said. 

Crabtree was on a team to help design Whole Farm at the beginning stages, and he says there are still some kinks that need to be worked out. But he says he would encourage any farmer growing specialty crops or more than three or four types to meet with an insurance agent to get a quote.

Farmers have until March to sign up for their insurance policies.

Jeff Schahczenski with the National Center for Appropriate Technology will host a webinar Thursday morning about insuring hemp in 2020. Right now the only option of the burgeoning crop is with the Whole Farm Revenue Protection policy.