Group Risk Income Protection (GRIP)

Group Risk Income Protection is designed as a risk management tool to insure against widespread loss of revenue from the insured crop in a county. GRIP policies use a county revenue index as the basis for determining a loss by using the estimated county yield for the insured crop, as determined by National Agricultural Statistics Service (NASS), multiplied by the harvest price. If the county revenue falls below the trigger revenue level chosen by the producer, an indemnity is paid. Unlike GRP, it is not necessary to have a decline in yield to be indemnified, as long as the combination of price and yield results in a county revenue that is less than the trigger revenue. Payments are not based on individual producer’s crop yields and revenues. Coverage levels are available for up to 90 percent of the expected county revenue. GRIP involves less paperwork and costs less than plans of insurance against individual loss. Under GRIP, an individual producer’s crop may receive reduced revenue from the insured acreage and not receive a payment under this plan if the county does not suffer a similar level of revenue loss. This insurance is primarily intended for producers whose crop yields typically follow the average county yield and wish to insure that the combination of yield and price result in a particular level of revenue.

Group Risk Income Protection - Harvest Revenue Option (GRIP-HRO) is a supplemental endorsement to the GRIP Basic Provisions. The Harvest Revenue Option changes the trigger revenue to be the result of multiplying the expected county yield by the greater of the expected price or the harvest price and by the producer chosen coverage level percentage. If the county revenue for the insured crop, type, and practice falls below the GRIP-HRO trigger revenue, an indemnity is paid.

This information is intended for informational purposes only. Nothing contained herein can or should be interpreted to take precedence over policy language, Federal Crop Insurance Corporation/Risk Management Agency regulation, and Underwriting or Loss Adjustment rules.

Last Updated March 2011

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