As a farmer, you work hard for every dollar you earn. In many ways, the outcome of all of your effort is out of your control. With climate change bringing increasingly unpredictable and extreme weather, crops are being tested in unprecedented ways. For many farmers, crop insurance is an effective tool to mitigate losses from these events. Consider how these coverages can help protect your investment.

Weather-Related Damage

This is the most common type of insurance taken out on crops. Known as multi-peril coverage, it protects against losses from weather-related events such as flooding, fire, and drought. It may also include crop damage from insects. Multi-peril coverage will usually cover the cost to replant fields if the damage occurs early enough in the season. 

Decreasing Crop Prices

Like all commodities, crops are subject to market fluctuations. When prices drop drastically, you may not be able to recover the cost of planting and harvesting your fields. That can lead to severe financial strain on a farm’s budget. Crop revenue insurance can protect against this type of price fluctuation. it may also cover loss of income when fields produce unusually low yields.

As you already know, many farms operate on a thin margin. Crop insurance can be a valuable tool to help guard against losses due to severe weather, insect damage, and fluctuating market prices.