# Fresh Plum Crop Insurance Provisions; and Common Crop Insurance Regulations; Plum Crop Insurance Provisions

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URL: https://www.frixlaw.com/law-library/documents/fr%3A97-3330

## Record

- **Collection:** Federal Register
- **Document type:** Proposed Rule
- **Published:** February 11, 1997
- **Citation:** 62 FR 6134

## Text

SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes
specific crop provisions for the insurance of plums. The provisions
will be used in conjunction with the Common Crop Insurance Policy Basic
Provisions, which contain standard terms and conditions common to most
crops. The intended effect of this action is to provide policy changes
to better meet the needs of the insured, include the current Fresh Plum
Crop Insurance Endorsement with the Common Crop Insurance Policy for
ease of use and consistency of terms, and to restrict the effects of
the current Fresh Plum Endorsement to the 1997 and prior crop years.

DATES: Written comments on this proposed rule will be accepted until
close of business April 14, 1997, and will be considered when the rule
is to be made final. The comment period for information collections
under the Paperwork Reduction Act of 1995 continues through April 11,
1997.

ADDRESSES: Interested persons are invited to submit written comments to
the Director, Product Development Division, Federal Crop Insurance
Corporation, United States Department of Agriculture, 9435 Holmes Road,
Kansas City, MO, 64131. Written comments will be available for public
inspection and copying in room 0324, South Building, United States
Department of Agriculture, 14th and Independence Avenue, SW.,
Washington, DC, 8:15 a.m. to 4:45 p.m., est, Monday through Friday,
except holidays.

FOR FURTHER INFORMATION CONTACT: Stephen Hoy, Program Analyst, Research
and Development, Product Development Division, Federal Crop Insurance
Corporation, at the Kansas City, MO address listed above, telephone
(816) 926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order No. 12866

The amendments set forth in this proposed rule contain information
collection that requires clearance by the Office of Management and
Budget (OMB) under provisions of 44 U.S.C. chapter 35.

Paperwork Reduction Act of 1995

The information collection requirements contained in these
regulations were previously approved by OMB pursuant to the Paperwork
Reduction Act of 1995 (44 U.S.C. chapter 35) under OMB control number
0563-0003 through September 30, 1998.
Section 7 of the 1998 Plum Crop Provisions adds interplanting as an
insurable farming practice as long as it is interplanted with another
perennial crop and does not adversely affect the insured crop. This
practice was not insurable under the previous fresh plum endorsement
and the General Crop Insurance Policy 88-G (REV 3-91) to which it
attached. Consequently, interplanting information will need to be
collected using the FCI-12-P Pre-Acceptance Perennial Crop Inspection
Report form for approximately two percent of the insureds who
interplant their plum crop. Standard interplanting language has been
added to most perennial crops to make insurance available for more
perennial crop producers and reduce the acreage that will need to be
placed into the noninsured crop disaster assistance program (NAP).
The other amendments set forth in this proposed rule to not contain
additional information collections that require clearance by OMB under
the provisions of 44 U.S.C. chapter 35.
The title of this information collection is ``Catastrophic Risk
Protection Plan and Related Requirements including, Common Crop
Insurance Regulations; Plum Crop Insurance Provision.'' The information
to be collected includes a crop insurance application and an acreage
report. Information collected from the application and acreage report
is electronically submitted to FCIC by the reinsured companies.
Potential respondents to this information collection are producers of
plums that are eligible for Federal crop insurance.
The information requested is necessary for the reinsured companies
and FCIC to provide insurance and reinsurance, determine eligibility,
determine the correct parties to the agreement or contract, determine
and collect premiums or other monetary amounts, and pay benefits.
All information is reported annually. The reporting burden for this
collection of information is estimated to average 16.9 minutes per
response for each of the 3.6 responses from approximately 1,755,015
respondents. The total annual burden on the public for the information
collection is 2,669,932 hours.
FCIC is requesting comments on the following: (a) Whether the
proposed collection of information is necessary for the proper
performance of the functions of the agency, including whether the
information shall have practical utility; (b) the accuracy of the
agency's estimate of the burden of the proposed collection of
information; (c) ways to enhance the quality, utility, and clarity of
the information to be collected; and (d) ways to minimize the burden of
the collection of information on respondents, including through the use
of automated collection techniques or other forms of information
gathering technology.
Comments regarding paperwork reduction should be submitted to the
Desk Officer for Agriculture, Office of Information and Regulatory
Affairs, Office of Management and Budget, Washington, DC 20503.
OMB is required to make a decision concerning the collections of
information contained in these proposed regulations between 30 and 60
days after submission to OMB. Therefore, a comment to OMB is best
assured of having full effect if OMB receives it within 30 days of
publication. This does not affect the deadline for the public to
comment on the proposed regulation.

Unfunded Mandates Reform Act of 1995

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public
Law 104-4, establishes requirements for

[[Page 6135]]

Federal agencies to assess the effects of their regulatory actions on
state, local, and tribal governments and the private sector. This rule
contains no Federal mandates (under the regulatory provisions of Title
II of the UMRA) for state, local, and tribal governments or the private
sector. Thus, the rule is not subject to the requirements of section
202 and 205 of the UMRA.

Executive Order No. 12612

It has been determined under section 6(a) of Executive Order No.
12612, Federalism, that this rule does not have sufficient federalism
implications to warrant the preparation of a Federalism Assessment. The
provisions contained in this rule will not have a substantial direct
effect on states or their political subdivisions, or on the
distribution of power and responsibilities among the various levels of
government.

Regulatory Flexibility Act

This regulation will not have a significant impact on a substantial
number of small entities. New provisions included in this rule will not
impact small entities to a greater extent than large entities. Under
the current regulations, a producer is required to complete an
application and acreage report. If the crop is damaged or destroyed,
the insured is required to give notice of loss and provide the
necessary information to complete a claim for indemnity. The producer
must also annually certify to the previous years production, if
adequate records are available to support the certification, or receive
a transitional yield. The producer must maintain the production records
to support the certified information for at least three years. This
regulation does not alter those requirements. The amount of work
required of the insurance companies delivering and servicing these
policies will not increase significantly from the amount of work
currently required. This rule does not have any greater or lesser
impact on the producer. Therefore, this action is determined to be
exempt from the provisions of the regulatory Flexibility Act (5 U.S.C.
605), and no Regulatory Flexibility Analysis was prepared.

Federal Assistance Program

This program is listed in the Catalog of Federal Domestic
Assistance under No. 10.450.

Executive Order No. 12372

This program is not subject to the provisions of Executive Order
No. 12372, which require intergovernmental consultation with state and
local officials. See the Notice related to 7 CFR part 3015, subpart V,
published at 48 FR 29115, June 24, 1983.

Executive Order No. 12778

The Office of the General Counsel has determined that these
regulations meet the applicable standards provided in sections 2(a) and
2(b)(2) of Executive Order No. 12778. The provisions of this rule will
not have a retroactive effect prior to the effective date. The
provisions of this rule will preempt state and local laws to the extent
such state and local laws are inconsistent herewith. The administrative
appeal provisions published at 7 CFR part 11 must be exhausted before
any action for judicial review may be brought.

Environmental Evaluation

This action is not expected to have a significant impact on the
quality of the human environment, health, and safety. Therefore,
neither an Environmental Assessment nor an Environmental Impact
Statement is needed.

National Performance Review

This regulatory action is being taken as part of the National
Performance Review Initiative to eliminate unnecessary or duplicative
regulations and improve those that remain in force.

Background

FCIC proposes to add to the Common Crop Insurance Regulations (7
CFR part 457), a new section, 7 CFR 457.157, Plum Crop Insurance
Provisions. The new provisions will be effective for the 1998 and
succeeding crop years. These provisions will replace and supersede the
current provisions for insuring fresh plums found at 7 CFR 401.146
(Fresh Plum Endorsement). FCIC also proposes to amend Sec. 401.146 to
limit its effect to the 1997 and prior crop years. FCIC will later
publish a regulation to remove and reserve Sec. 401.146.
This rule makes minor editorial and format changes to improve the
Fresh Plum Endorsement's compatibility with the Common Crop Insurance
Policy. In addition, FCIC is proposing substantive changes in the
provisions for insuring plums as follows:
1. Remove the word ``fresh'' from the title of the policy since
plums marketed for uses other than fresh packed are covered.
2. Section 1--Add definitions for the terms ``days,'' ``direct
marketing,'' ``good farming practice,'' ``interplanted,'' ``irrigated
practice,'' ``non-contiguous,'' ``pitburn and sunburn,'' ``production
guarantee (per acre),'' ``scion,'' ``varietal group,'' and ``written
agreement'' for clarification purposes.
3. Section 2(e)(3)(ii)--Add optional units by varietal group to be
consistent with other policies that offer insurance by crop variety.
4. Section 3(a)--Specify that the insured may select only one price
election for all the plums in the county insured under this policy,
unless the Special Provisions provide different price elections by
varietal group, in which case the insured may select one price election
for each varietal group. The price election the insured selects must
have the same percentage relationship to the maximum price offered.
This helps to protect against adverse selection and simplifies
administration of the program.
5. Section 3(b)--Specify that an insured must report damage,
removal of trees, and any change in practice that may reduce yields.
For the first year of insurance for acreage interplanted with another
perennial crop and anytime the planting pattern of such acreage is
changed, the insured must report the age and varietal group, if
applicable, of any interplanted perennial crop, its planting pattern,
and any other information needed to establish the approved yield. If
the insured fails to notify the insurer of factors that may reduce
yields from previous levels, the insurer will reduce the production
guarantee at any time the insurer becomes aware of damage, removal of
trees, or changes in practices. This allows the insurance provider to
limit liability, if necessary, before insurance attaches.
6. Section 6--Remove the provision that restricts crop insurance
coverage if plums are harvested directly by the public. Section 10(b)
of the proposed rule requires the insured to notify the insurance
provider at least 15 days before any production from any unit will be
sold by direct marketing in order to accurately determine production to
count.
7. Section 6(d)--Specify that at least 200 lugs per acre must have
been produced in at least one of the three most recent actual
production history crop years. Previous regulations required a minimum
of 200 lugs per acre of fresh market production in the previous crop
year unless the acreage is inspected by us and approved for coverage.
Basing the required minimum production on only the previous crop year
is too restrictive considering that one year of adverse growing
conditions would exclude eligibility for crop insurance.
8. Section 6(f)--Allow insurance for plums produced on scions that
have not reached the fifth growing season after being grafted to
established rootstock. If

[[Page 6136]]

all other requirements for insurability have been met, the crop should
make the approved yield.
9. Section 7--Allow insurance for plums interplanted with another
perennial crop in order to make insurance available on more acreage and
reduce the reliance on the noninsured crop disaster assistance program
(NAP) for protection against crop losses.
10. Section 8(a)(1)--Specify that the insurance period begins on
February 1 of each crop year, except for the year of application, if
the application is received after January 22 but prior to February 1,
insurance will attach on the 10th day after the application is received
in the insurance provider's local office unless the acreage is
inspected during the 10 day period and does not meet insurability
requirements. This provision is consistent with other perennial crops
to prevent producers from obtaining insurance only when they know a
loss is likely.
11. Section 8(b)--Add provisions to clarify the procedures when an
insurable share is acquired or relinquished on or before the acreage
reporting date.
12. Section 9(a)(2)--Add pitburn and sunburn as insured causes of
loss since they are common causes of loss.
13. Section 9(c)(1)--Clarify that disease and insect infestation
are excluded causes of loss unless adverse weather prevents the proper
application of control measures, causes control measures to be
ineffective when properly applied, or causes disease or insect
infestation for which no effective control mechanism is available.
14. Section 10(a)--Specify the notice requirements if the orchard
has suffered a loss, and the crop will not be harvested, in order to
permit timely appraisal of any loss.
15. Section 10(b)--Require the producer to give notice at least 15
days prior to harvest so a preharvest inspection can be made if the
insured intends to engage in direct marketing to consumers. This is
necessary to permit an accurate appraisal of production to count
because it is difficult to verify production that is directly marketed
to consumers.
16. Section 10(c)--Require the producer to give at least 15 days
notice prior to the beginning of harvest or immediately if damage is
discovered during harvest to permit the insurance provider to make a
timely inspection.
17. Section 10(d)--Prohibit the insured from selling or otherwise
disposing of any damaged production until consent is given by the
insurance provider.
18. Section 11(c)(2)(i)--Change the quality specifications for
determining production to count from U.S. Number 1 standards to the
California Marketing Order grade requirements in effect for the crop
year, since such grade order requirements better correspond with the
quality specifications used by the plum industry.
19. Sections 11(c)(2)(ii)--Specify the adjustment of the production
to count for harvested production that is packed and sold as fresh
fruit but does not meet California Marketing Order grade requirements.
20. Sections 11(c)(2)(iii)--Specify the adjustment of the
production to count for harvested production that is or could be
marketed for any use other than fresh packed plums.
21. Section 12--Add provisions for providing insurance covered by
written agreement. FCC has a long standing policy of permitting certain
modifications of the insurance contracts by written agreement for some
policies. This amendment allows FCC to tailor the policy to a specific
insured in certain instances. The new section will cover the
application for and duration of written agreements.

List of Subjects in 7 CFR Parts 401 and 457

Crop insurance, Fresh plums endorsement, Plums.

Proposed Rule

Accordingly, for the reasons set forth in the preamble, the Federal
Crop Insurance Corporation hereby proposes to amend 7 CFR parts 401 and
457 as follows:

PART 401--GENERAL CROP INSURANCE REGULATIONS--REGULATIONS FOR THE
1988 AND SUBSEQUENT CONTRACT YEARS

1. The authority citation for 7 CFR part 401 continues to read as
follows:

Authority: 7 U.S.C. 1506(l), 1506(p).

2. The introductory text of Sec. 401.146 is revised to read as
follows:

Sec. 401.146 Fresh plum endorsement.

The provisions of the Fresh Plum Crop Insurance Endorsement for the
1990 through the 1997 crop years are as follows:
* * * * *

PART 457-COMMON CROP INSURANCE REGULATIONS; REGULATIONS FOR THE
1994 AND SUBSEQUENT CONTRACT YEARS

3. The authority citation for 7 CFR part 457 continues to read as
follows:

Authority: 7 U.S.C. 1506(l), 1506(p).

4. 7 CFR part 457 is amended by adding a new Sec. 457.157 to read
as follows:

Sec. 457.157 Plum Crop Insurance Provisions.

The Plum Crop Insurance Provisions for the 1998 and succeeding crop
years are as follows:

FCIC policies:

Department of Agriculture

Federal Crop Insurance Corporation

Reinsured policies:

(Appropriate title for insurance provider)
Both FCIC and reinsured policies:

Plum Crop Provisions

If a conflict exists among the Basic Provisions (Sec. 457.8),
these crop provisions, and the Special Provisions; the Special
Provisions will control these crop provisions and the Basic
Provisions; and these crop provisions will control the Basic
Provisions.
1. Definitions.
Days--Calendar days.
Direct marketing--Sale of the insured crop directly to consumers
without the intervention of an intermediary such as a wholesaler,
retailer, packer, processor, shipper, or buyer. Examples of direct
marketing include selling through an on-farm or roadside stand,
farmer's market, and permitting the general public to enter the
field for the purpose of picking all or a portion of the crop.
Good farming practices--The cultural practices generally in use
in the county for the crop to make normal progress toward maturity
and produce at least the yield used to determine the production
guarantee, and are those recognized by the Cooperative State
Research, Education, and Extension Service as compatible with
agronomic and weather conditions in the county.
Harvest--The picking of mature plums from the trees either by
hand or machine.
Interplanted--Acreage on which two or more crops are planted in
any form of alternating or mixed pattern.
Irrigated practice--A method of producing a crop by which water
is artificially applied during the growing season by appropriate
systems and at the proper times, with the intention of providing the
quantity of water needed to produce at least the yield used to
establish the irrigated production guarantee on the irrigated
acreage planted to the insured crop.
Lug--Twenty-eight (28) pounds of the insured crop.
Non-contiguous--Any two or more tracts of land whose boundaries
do not touch at any point, except that land separated only by a
public or private right-of-way, waterway, or an irrigation canal
will be considered as contiguous.
Pitburn and sunburn--Damage to fresh fruit as a result of
excessive heat.
Production guarantee (per acre)--The number of lugs of plums
determined by multiplying the approved APH yield per acre by the
coverage level percentage you elect.

[[Page 6137]]

Scion--Twig or portion of a twig of one plant that is grafted on
to a stock of another.
Varietal group--Different varieties of plums that are grouped
according to the normal maturity dates as specified in the Special
Provisions.
Written agreement--A written document that alters designated
terms of this policy in accordance with section 12.
2. Unit Division.
(a) Unless limited by the Special Provisions, a unit as defined
in section 1 (Definitions) of the Basic Provisions (Sec. 457.8)
(basic unit), may be divided into optional units if, for each
optional unit, you meet all the conditions of this section or if a
written agreement to such division exists.
(b) Basic units may not be divided into optional units on any
basis other than as described in this section.
(c) If you do not comply fully with these provisions, we will
combine all optional units that are not in compliance with these
provisions into the basic unit from which they were formed. We will
combine the optional units at any time we discover that you have
failed to comply with these provisions. If failure to comply with
these provisions is determined to be inadvertent, and the optional
units are combined into a basic unit, that portion of the additional
premium paid for the optional units that have been combined will be
refunded to you for the units combined.
(d) All optional units you selected for the crop year must be
identified on the acreage report for that crop year.
(e) The following requirements must be met for each optional
unit:
(1) You must have records, which can be independently verified,
of acreage and production for each optional unit for at least the
last crop year used to determine your production guarantee;
(2) You must have records of marketed production or measurement
of stored production from each optional unit maintained in such a
manner that permits us to verify the production from each optional
unit, or the production from each unit must be kept separate until
loss adjustment is completed by us; and
(3) Each optional unit must meet one or more of the following
criteria, as applicable:
(i) Optional Units on Acreage Located on Non-Contiguous Land:
Optional units may be established if each optional unit is located
on non-contiguous land.
(ii) Optional Units on Acreage by Varietal Group: In addition
to, or instead of, establishing optional units on non-contiguous
land, optional units may be established by varietal group when
provided for in the Special Provisions.
3. Insurance Guarantees, Coverage Levels, and Prices for
Determining Indemnities.
In addition to the requirements of section 3 (Insurance
Guarantees, Coverage Levels, and Prices for Determining Indemnities)
of the Basic Provisions (Sec. 457.8):
(a) You may select only one price election for all the plums in
the county insured under this policy unless the Special Provisions
provide different price elections by varietal group, in which case
you may select one price election for each plum varietal group
designated in the Special Provisions. The price elections you choose
for each varietal group must have the same percentage relationship
to the maximum price offered by us for each varietal group. For
example, if you choose 100 percent of the maximum price election for
one varietal group, you must also choose 100 percent of the maximum
price election for all other varietal groups.
(b) You must report, by the production reporting date designated
in section 3 (Insurance Guarantees, Coverage Levels, and Prices for
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by
varietal group if applicable:
(1) Any damage, removal of trees, change in practices, or any
other circumstance that may reduce the expected yield below the
yield upon which the insurance guarantee is based, and the number of
affected acres;
(2) The number of bearing trees on insurable and uninsurable
acreage;
(3) The age of the trees and the planting pattern; and
(4) For the first year of insurance for acreage interplanted
with another perennial crop, and anytime the planting pattern of
such acreage is changed:
(i) The age of the interplanted crop and varietal group if
applicable;
(ii) The planting pattern; and
(iii) Any other information that we request in order to
establish your approved yield.
We will reduce the yield used to establish your production
guarantee as necessary, based on our estimate of the effect of
interplanting a perennial crop, removal of trees, damage, change in
practice, and any other circumstance that may effect the yield
potential of the insured crop. If you fail to notify us of any
circumstance that may reduce your yields from previous levels, we
will reduce your production guarantee as necessary at any time we
become aware of the circumstance.
4. Contract Changes.
In accordance with section 4 (Contract Changes) of the Basic
Provisions (Sec. 457.8), the contract change date is October 31
preceding the cancellation date.
5. Cancellation and Termination Dates.
In accordance with section 2 (Life of Policy, Cancellation, and
Termination) of the Basic Provisions (Sec. 457.8), the cancellation
and termination dates are January 31.
6. Insured Crop.
In accordance with section 8 (Insured Crop) of the Basic
Provisions (Sec. 457.8), the crop insured will be all the plums in
the county for which a premium rate is provided by the actuarial
table:
(a) In which you have a share;
(b) That are grown on tree varieties that:
(1) Were commercially available when the trees were set out;
(2) Are adapted to the area;
(3) Are grown on rootstock that is adapted to the area; and
(4) Are regulated by the California Advisory Board Standards, a
related crop advisory board, or the state;
(c) That are irrigated;
(d) That have produced an average of at least 200 lugs per acre
in at least one of the three most recent actual production history
crop years, unless we inspect such acreage and give our approval in
writing;
(e) That are grown in an orchard that, if inspected, is
considered acceptable by us; and
(f) That have reached at least the fifth (5th) growing season
after set out. Plums produced on scions that have not reached the
fifth growing season may be insured if the provisions in section 6
(a), (b), (c), and (e) are met. Such trees must have produced at
least 200 lugs per acre in at least one year after being grafted.
7. Insurable Acreage.
In lieu of the provisions in section 9 (Insurable Acreage) of
the Basic Provisions (Sec. 457.8) that prohibit insurance attaching
to a crop planted with another crop, plums interplanted with another
perennial crop are insurable unless we inspect the acreage and
determine that it does not meet the requirements contained in your
policy.
8. Insurance Period.
(a) In accordance with the provisions of section 11 (Insurance
Period) of the Basic Provisions (Sec. 457.8):
(1) Coverage begins on February 1 of each crop year, except that
for the year of application, if your application is received after
January 22 but prior to February 1, insurance will attach on the
10th day after your properly completed application is received in
our local office unless we inspect the acreage during the 10 day
period and determine that it does not meet insurability
requirements. You must provide any information that we require for
the crop or to determine the condition of the orchard.
(2) The calendar date for the end of the insurance period for
each crop year is September 30.
(b) In addition to the provisions of section 11 (Insurance
Period) of the Basic Provisions (Sec. 457.8):
(1) If you acquire an insurable share in any insurable acreage
after coverage begins but on or before the acreage reporting date
for the crop year, and after an inspection we consider the acreage
acceptable, insurance will be considered to have attached to such
acreage on the calendar date for the beginning of the insurance
period.
(2) If you relinquish your insurable share on any insurable
acreage of plums on or before the acreage reporting date for the
crop year, insurance will not be considered to have attached to, and
no premium or indemnity will be due for such acreage for that crop
year unless:
(i) A transfer of coverage and right to an indemnity, or a
similar form approved by us, is completed by all affected parties;
(ii) We are notified by you or the transferee in writing of such
transfer on or before the acreage reporting date; and
(iii) The transferee is eligible for crop insurance.
9. Causes of Loss.
(a) In accordance with the provisions of section 12 (Causes of
Loss) of the Basic Provisions (Sec. 457.8), insurance is provided
only against the following causes of loss that occur during the
insurance period:
(1) Adverse weather conditions;
(2) Pitburn and sunburn;
(3) Fire, unless weeds and other forms of undergrowth have not
been controlled or

[[Page 6138]]

pruning debris has not been removed from the orchard;
(4) Wildlife;
(5) Earthquake;
(6) Volcanic eruption;
(7) An insufficient number of chilling hours to effectively
break dormancy; or
(8) Failure of the irrigation water supply, if caused by an
insured peril that occurs during the insurance period.
(b) In addition to the causes of loss excluded in section 12
(Causes of Loss) of the Basic Provisions (Sec. 457.8), we will not
insure against damage or loss of production due to:
(1) Disease or insect infestation, unless adverse weather:
(i) Prevents the proper application of control measures or
causes properly applied control measures to be ineffective; or
(ii) Causes disease or insect infestation for which no effective
control mechanism is available;
(2) Rejection of the crop by the packing house due to being
undersized, immature, overripe, or mechanically damaged; or
(3) Inability to market the plums for any reason other than
actual physical damage from an insurable cause specified in this
section. For example, we will not pay you an indemnity if you are
unable to market due to quarantine, boycott, or refusal of any
person to accept production.
10. Duties In The Event of Damage or Loss.
In addition to the requirements of section 14 (Duties in the
Event of Damage or Loss) of the Basic Provisions (Sec. 457.8), the
following will apply:
(a) You must notify us within 3 days of the date harvest should
have started if the crop will not be harvested.
(b) You must notify us at least 15 days before any production
from any unit will be sold by direct marketing. We will conduct an
appraisal that will be used to determine your production to count
for production that is sold by direct marketing. If damage occurs
after this appraisal, we will conduct an additional appraisal. These
appraisals, and any acceptable records provided by you, will be used
to determine your production to count. Failure to give timely notice
that production will be sold by direct marketing will result in an
appraised amount of production to count of not less than the
production guarantee per acre if such failure results in our
inability to make the required appraisal.
(c) If you intend to claim an indemnity on any unit, you must
notify us at least 15 days prior to the beginning of harvest or
immediately if damage is discovered during harvest, so that we may
inspect the damaged production.
(d) You must not sell or dispose of the damaged crop until after
we have given you written consent to do so. If you fail to notify us
and such failure results in our inability to inspect the damaged
production, we may consider all such production to be undamaged and
include it as production to count.
11. Settlement of Claim.
(a) We will determine your loss on a unit basis. In the event
you are unable to provide separate acceptable production records:
(1) For any optional units, we will combine all optional units
for which acceptable production records were not provided; or
(2) For any basic units, we will allocate any commingled
production to such units in proportion to our liability on the
harvested acreage for the units.
(b) In the event of loss or damage covered by this policy, we
will settle your claim by:
(1) Multiplying the insured acreage for each varietal group, if
applicable, by its respective production guarantee;
(2) Multiplying the results in section 11(b)(1) by the
respective price election for each varietal group, if applicable;
(3) Totaling the results in section 11(b)(2);
(4) Multiplying the total production to be counted of each
varietal group, if applicable, (see section 11(c)) by the respective
price election;
(5) Totaling the results in section 11(b)(4);
(6) Subtracting the results in section 11(b)(5) from the results
in section 11 (b)(3); and
(7) Multiplying the result in section 11(b)(6) by your share.
(c) The total production to count (in lugs) from all insurable
acreage on the unit will include:
(1) All appraised production as follows:
(i) Not less than the production guarantee per acre for acreage:
(A) That is abandoned;
(B) That is sold by direct marketing directly if you fail to
meet the requirement contained in section 10;
(C) That is damaged solely by uninsured causes; or
(D) For which you fail to provide production records that are
acceptable to us.
(ii) Production lost due to uninsured causes;
(iii) Unharvested production; and
(iv) Potential production on insured acreage that you intend to
abandon or no longer care for, if you and we agree on the appraised
amount of production. Upon such agreement, the insurance period for
that acreage will end. If you do not agree with our appraisal, we
may defer the claim only if you agree to continue to care for the
crop. We will then make another appraisal when you notify us of
further damage or that harvest is general in the area unless you
harvested the crop, in which case we will use the harvested
production. If you do not continue to care for the crop, our
appraisal made prior to deferring the claim will be used to
determine the production to count; and
(2) All harvested production from the insurable acreage:
(i) That is packed and sold as fresh fruit and meets the
California Marketing Order grade requirements, as amended, in effect
for the applicable crop year;
(ii) That is packed and sold as fresh fruit but does not meet
the grade requirements specified in section 11(c)(2)(i) due to
insurable causes. Such production will be adjusted by:
(A) Dividing the value per lug of this production by the highest
price election available for the applicable varietal group; and
(B) Multiplying the resulting factor, if less than 1.0, by the
number of lugs of such plums.
(iii) That is damaged and is, or could be, marketed for any use
other than fresh packed plums. Such production will be adjusted by:
(A) Multiplying the number of tons of such production by the
value per ton of the damaged plums or $50.00, whichever is greater;
and
(B) Dividing that result by the highest price election available
for the applicable varietal group.
12. Written agreement.
Designated terms of this policy may be altered by written
agreement in accordance with the following:
(a) You must apply in writing for each written agreement no
later than the sales closing date, except as provided in section
12(e);
(b) The application for a written agreement must contain all
terms of the contract between you and us that will be in effect if
the written agreement is not approved;
(c) If approved, the written agreement will include all variable
terms of the contract, including, but not limited to, crop variety,
the guarantee, premium rate, and price election;
(d) Each agreement will only be valid for one year (If the
written agreement is not specifically renewed the following year,
insurance coverage for subsequent crop years will be in accordance
with the printed policy); and
(e) An application for written agreement submitted after the
sales closing date may be approved if, after physical inspection of
the acreage, it is determined that no loss has occurred and the crop
is insurable in accordance with the policy and written agreement
provisions.

Signed in Washington, DC, on February 6, 1997.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 97-3330 Filed 2-10-97; 8:45 am]
BILLING CODE 3410-FA-P

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A97-3330. Public record. Not legal advice.