Margin Protection Coverage

  • September 16, 2021
  • Posted by: Daniel Lefstad
  • Category: News
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Margin Protection
With higher commodity prices and rising input costs there has been some renewed interest in Margin Protection. The Margin Protection (MP) plan of insurance is available for wheat, corn, and soybeans in most of our region. Margin Protection can be purchased by itself or in conjunction with a Revenue Protection (RP) or Yield Protection (YP) MPCI policy.

The Margin Protection (MP) policy provides you coverage against an unexpected decrease in your operating margin (expected margin = expected revenue – input costs). Margin Protection is AREA BASED, using COUNTY-LEVEL estimates of average revenue and input costs to establish the amount of coverage and indemnity. Because Margin Protection is area based and uses the average for the county, it may not necessarily reflect your individual experience. Your own operations yields and costs are not taken into account. If the average margin for the county is lower than expected, due to a decrease in revenue and/or an increase in input costs, Margin Protection will cover a portion of that shortfall. You may choose to cover anywhere from 70 to 95% of the expected margin in your county. In addition you have the ability to elect the Harvest Price Option and also choose a protection factor from 80 to 120% which will increase or decrease premium/indemnity. There are no replant or prevent plant provisions with an MP policy, only insures planted acres.

If a MPCI RP or YP policy is purchased, it must be with the same insurance company that issued the Margin Protection policy. If you buy a RP or YP policy, you will receive a premium credit on your Margin Protection policy to reflect that indemnity payments from one policy can offset payments from the other.  Any indemnities owed will be paid when final county yields are available, in spring the following year. The sales closing date for Margin Protection policy for 2022 is September 30th  2021.    For more information give us a call at ProAg.

ProAg Service & Insurance
2417 US Hwy 59
Mahnomen, MN  56557
218.935.2700 (office)
This agency is an equal opportunity provider