With the changes in the hemp industry at of the passage of the 2018 Farm Bill and the many changes on the horizon, it’s important that you protect your business and your investment. Now that hemp has been classified as an agricultural commodity, hemp farms have access to insurance options that other crop farmers use.
What type of insurance does your hemp farm need? Start with these three policies.
Multiple Peril Crop Insurance
One of the most common insurance policies for crop farmers is multiple peril crop insurance or MPCI. These policies are federally regulated but available for purchase from your local independent insurance agency.
MPCI covers crop losses and lower yields that occur after natural events:
- Insect damage
- Weather damage from hail, frost, and wind
Your policy must be purchased before your crop is planted each growing season and by federally mandated deadlines. If you experience hemp crop damage early in the planting season, your policy may include incentives to help you replant. But it may also include penalties if you don’t replant at all.
Crop Hail Coverage
Crop hail coverage is not federally regulated or mandated and the majority of farmers purchase it as a supplement to their MPCI policy. It’s most common in areas with high occurrences of hail storms and damage. Unlike MPCI, you can buy crop hail coverage at any point in the growing season, and it often has low or no deductible.
Crop Revenue Insurance
Even if your hemp crop makes it through the harvesting season, you may still experience losses. Crop revenue insurance protects you in years when you have a low-yield crop or when prices fall dramatically. This policy covers your earnings against wild and potentially devastating swings in hemp prices, no matter what the cost. Your insurance policy will pay an amount that compares the current year’s revenues to previous years earnings so you don’t have to face a big loss.
Your hemp farm is a business and needs many forms of business insurance. But it’s a farm first, and without a successful crop, you could be out of business. Make sure you protect your hemp farm and your business with insurance designed specifically for your needs. As the laws and rules change regarding hemp, so too will your business options. Work with an independent insurance agency who can help you through every stage. Contact Charlotte Insurance today!