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Good Farming Practices (GFP) and Crop Insurance

January 2, 2024 - Craig Nielsen

What are good farming practices and why are they important? The Federal crop insurance program covers losses that are unavoidable and due to naturally occurring events. The program does not cover losses due to negligence, or any failure to follow good farming practices. If good farming practices are not followed, lost production attributed to this failure must be assessed and any indemnity will be reduced. This is true for all insured farmers regardless of their plan of insurance. The definition of good farming practices will vary from crop to crop and from region to region. A good rule of thumb is that you should follow all the practices considered prudent and responsible by local extension agents and certified crop consultants to produce your crop’s historic yield. In the basic provisions of the crop insurance policy, the definition of negligence is, “The failure to use such care as a reasonably prudent and careful person would use under similar circumstances.”

The purpose of the Good Farming Practice provisions with crop insurance is to ensure that a policyholder’s production methods do not adversely affect the quantity and/or quality of the production. Consider any practice that could affect the amount and quality of the crop, from ground preparation through harvest. In the case of perennials, consider practices from post-harvest of the previous crop year through harvest of the current crop year that could affect the amount and quality of the crop. Policyholders are responsible for establishing that the farming practice in question was a good farming practice.

The Approved Insurance Provider (AIP) makes an initial decision of whether the production methods used by a policyholder constitute GFP according to the terms of the policy and these procedures and determines whether the policyholder carried out generally recognized GFPs. These procedures apply to all GFP decisions, regardless of the origination of the review, i.e., RCO review requests, loss adjustment process, growing season inspection, etc., when the AIP or RMA has a reason to question whether GFP was followed by the policyholder. The AIP shall provide a precise description of the production methods employed by the policyholder that adversely impacted the yield from making normal progress toward maturity. The AIP is responsible for providing sufficient documentation that supports all failure to follow good farming practices determinations.

Economic conditions are not a valid consideration for deciding if a production method is a GFP or if a policyholder is justified in not following a GFP. Accordingly, the policyholder will not be exempt from following a recommended GFP because a policyholder does not want to or cannot afford to incur the costs associated with following the recommendations of agricultural experts or published materials. If an AIP’s GFP decision finds the policyholder failed to follow GFP, only the AIP can assign production or value as uninsured causes of loss for such failure. While conducting GFP determinations, instances of suspected fraud, waste, or abuse and suspected wrongdoing in the use of FCIC-issued policies, standards, and procedures may be identified and should be discussed initially with the appropriate RCO.

• Remember, using good farming practices is your responsibility.
• You are responsible for keeping informed about disease or pest outbreaks in your area.
• You are responsible for keeping informed about what constitutes good farming practices in the event of an outbreak that reaches your farm or ranch.
• You are responsible for frequently scouting your fields and documenting your findings.
• You are responsible for keeping records of your good farming practices, broken out by each insurable unit, just like your production records.

For more information: please contact a licensed crop insurance agent.

14060 Good Farming Practices Standards Handbook 2024 (usda.gov)
Good Farming Practices Protect (usda.gov)

Published in: Crop Insurance