October 21, 2011
The U.S. Department of Agriculture's Risk Management Agency (RMA) this week announced its plans to fairly distribute the available funding for livestock insurance programs for the 2012 fiscal year. The Federal Crop Insurance Act limits expenditures for costs for all livestock pilot programs to a combined total of $20 million per fiscal year.
RMA currently provides eight plans of insurance that cover livestock with Livestock Risk Protection-Lamb being one. Livestock Gross Margin for Dairy used approximately $16.2 million of the total funding during fiscal year 2011, while other livestock plans of insurance also experienced increased expenditures so that for the first time, the entire $20 million was used.
For fiscal year 2012, RMA is initially allocating $14.6 million to support livestock plans of insurance, holding $5.4 million in reserve, based on past sales expenditures and experience. RMA will closely monitor available funding for all livestock insurance plans and make adjustments, as necessary, to distribute available funding equitably. This may result in sales for particular plans of livestock insurance to cease if initial allocations are met.
Alternatively, if RMA determines that sales of other plans are not using initial allocations, adjustments may be made for sales of any plan initially exceeding its capacity to resume. RMA will work to re-allocate funds during the fiscal year to minimize ceasing and re-starting sales, taking into account the most fair and equitable distribution of funding to all available plans experiencing sales.