Base Price Modifier for Corn and Soybeans
- High risk, unrated or uninsurable acreage.
- WFRP, CAT coverage and ARPI plans.
- Acreage that is prevented from planting.
- Acreage insured by written agreement with the exception of Written Unit Agreements.
- Second or double crops as defined in the MPCI Policy.
- Crops insured with New Producer status.
Indemnity Calculation Example
The insured will receive an indemnity payment from the BPM policy in addition to the MPCI payment only when a yield loss occurs and the production to count is less than the MPCI production guarantee. The formula for calculating the BPM indemnity is as follows: MPCI production guarantee for the BPM unit minus the MPCI production to count times the BPM price election times the insured’s share.
A grower has 200 acres of soybeans insured under the MPCI Revenue Protection plan (RP) at an 85% coverage level and 100% share. The approved yield for a unit is 45 bu.
The MPCI projected price is $9.00.
The RP guarantee is:
45bu. X 0.85 = 38 X $9.00 = $342.00 per acre.
The grower also buys a BPM policy with a price election of $0.80 per bushel.
The grower harvests 30 bu. per acre indicating a yield loss of 8 bu. per acre.
The harvest price was $9.75/bu. for a revenue to count of $292.50.
The indemnity payment per acre in this example will be:
- RP indemnity:
$342.00 - $292.50 = $49.50 per acre
- BPM indemnity:
38 bu. – 30 bu. = 8 bu. X $0.80 = $6.40 per acre
- Total indemnity:
$55.90 per acre
BPM premium is calculated by multiplying the BPM liability by the BPM rate for the crop/county (rounded to the nearest whole dollar).