MASC AgriInsurance for Organic Crops – Q & A

Mike Street, MASC

If you’re certified to grow organic crops in Manitoba, you can manage the risks associated with organic production through MASC AgriInsurance. Before the new crop year gets started, MASC would like to address some issues that specifically pertain to organic farmers.

What crops can I insure?

Organic producers can insure their crops under the organic option (limited to wheat, flax and oats) or through MASC’s conventional AgriInsurance programs. However, under conventional AgriInsurance, MASC requires higher levels of weed control and offers a lower dollar value than the organic option.

What is ‘Individual Coverage’ and how does it apply to organic producers?

Individual Coverage (IC) gives each producer an individualized ‘probable yield’ for crops that is based on the producer’s own yield history. The IC calculation uses a 10-year moving average of a producer’s yields for each crop type. A two-year lag is applied for the IC calculation, so data from 2003 to 2012 will be used to calculate a producer’s IC probable yields in 2014. If a producer hasn’t grown the crop in any of the previous 10 years, an area average is used to represent non-growing years. If a producer was not previously insured but has historical yield data, MASC will use the producer’s data in the calculation, provided it can be verified. Newly insured growers are allowed a 5-year ‘fast track’ to quick start their IC. If the producer falls short of the coverage based on the probable yield for that crop, they are entitled to a claim.

The IC method for non-organic producers is limited to certain crops, but all organic crops are eligible for individual coverage.

What are MASC’s adjusting procedures for organic crops?

Most of MASC’s adjusting procedures for organic crops are the same as for non-organics, but there are a few differences that acknowledge the special conditions required for organic crops.

“We certainly verify a producer’s organic certification,” says David Van Deynze, MASC Manager of Claim Services. “But otherwise, our adjustors don’t ask for anything more of organic producers than what’s required from a non-organic producer.”

“We do have a bit more tolerance for weed control and fertility issues,” adds Van Deynze. “Obviously, we look at organic fields differently than non-organic fields when identifying weed issues. In the case of reseeds, MASC considers early-season weed problems a designated peril for organic crops, while for non-organic crops we consider it a management issue.”

What are the policies for growing intercrop mixtures?

Organic producers in Manitoba have found some success with intercropping and mixing crops that provide mutual benefits, most often with field peas and canola, cereal/flax or cereal/pea combinations. However, due to difficulties in both management of intercropped fields and MASC’s administration of intercropped fields, MASC deems intercropping ineligible for insurance.

“Management of intercropping for organic producers is quite challenging,” says Doug Wilcox, Manager of Program Development – Insurance. The timing of seeding two crops can be easily interrupted by inclement conditions. At harvest, one crop may be ready while the other is still green and maturing. “These factors add considerable risk to a producer’s success, enough that these crops become uninsurable to MASC at the present premium levels,” explains Wilcox.

Administering the AgriInsurance program for intercrop mixtures is also particularly demanding. The program requires a declared primary crop to determine rates and coverages, but as the two mixed crops are competing for resources, yields for the primary crop will often be less than if grown alone. This creates a situation where a producer’s yield for the declared crop will appear artificially low and appear to be in a claim position.

This scenario was seen during the period from 1992 to 1995, when MASC covered intercrop mixtures. MASC also found that intercropping required a disproportionate amount of corporate resources for a quite limited acreage. Additional resources were required to track and determine relative stands through early pre-harvest stand appraisals (not required for single crops), along with additional resources required for pre-harvest claims on intercrop mixtures that effectively doubled MASC’s workload.

“There is sympathy to the concern that MASC may be passively discouraging the practice of intercropping,” says Wilcox, “However, the business decision made in 1996 to no longer insure intercrops has not caused any significant insurance concerns to date.”

For more information about AgriInsurance for organic crops, please visitmasc.mb.caor contact your MASC Insurance Agent.

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