Farms can be insured against catastrophic events. Insurance policies are available for replacement of materials damaged, repair work for recovery, boarding of occupants and animals if evacuated, lost production, and relocation. These should be investigated and purchased before the disaster threatens. For a farmer to claim compensation for lost production, which in many cases is the largest economic cost during a disaster, the farmer must have substantial records that document the level of production his/her herd has achieved in previous years. One of the best ways is using recognized herd monitoring programs, such as Dairy Herd Improvement or other programs that are available for various species. To verify the validity of these records a herd health program should be in place, which is based on a valid veterinarian-client-animal relationship. A copy of all production records should be kept in a secure place that the details are not lost during the disaster.
USDA Livestock Disaster Programs
Livestock Forage Program (LFP): LFP provides compensation to eligible livestock producers that have suffered grazing losses due to drought or fire on land that is native or improved pastureland with permanent vegetative cover or that is planted specifically for grazing. Read detailed about the LFP program.
Livestock Indemnity Program (LIP): LIP provides benefits to livestock producers for livestock deaths in excess of normal mortality caused by adverse weather or by attacks by animals reintroduced into the wild by the federal government. Learn more about the Livestock Indemnity Program.
Emergency Assistance for Livestock, Honeybees, and Farm-Raised Fish (ELAP):ELAP provides emergency assistance to eligible producers of livestock, honeybees and farm-raised fish for losses due to disease (including cattle tick fever), adverse weather, or other conditions, such as blizzards and wildfires, not covered by LFP and LIP.Learn more about Emergency Assistance for Livestock, Honeybeas, and Farm-Raised Fish.
In order for you to be eligible for a USDA disaster program, you generally need to be in an area that has been declared a disaster by USDA. A list of all disaster declarations is available here: http://catalog.data.gov/dataset/disaster-declarations-usda. The USDA Emergency Response website also includes other disaster aid for farms.
USDA-RMA also Offers Revenue Insurance Products for Livestock Producers
Rapidly changing livestock prices feed costs can put a livestock operation at risk. Two types of livestock insurance are sold through USDA’s Risk Management Agency (RMA). Livestock Risk Protection (LRP) protects producers against a drop in prices. Livestock Gross Margin (LGM) insurance protects producers from losses of gross margin, from falling livestock prices, rising feed costs or both. Neither of these policies protects producers against a disease outbreak or death losses. Both of these types of insurance can be purchased to cover finished beef cattle, feeder cattle, market hogs, market lambs or dairy. Both LRP and LGM settlements are based on national market prices, not necessarily the price you receive. Your own price may be above or below what the national market was. By the same token, your own cost of production is not the figure used to determine gross margin; that is calculated with national grain prices from the Chicago Board of Trade.
To learn more:
RMA Livestock Insurance Programs http://www.rma.usda.gov/livestock/
More information about RMA Insurance Programs: http://www.usda.gov/wps/portal/usda/usdahome?navid=CROP_LIVESTOCK_INSUR
Last updated May 29, 2015