The Importance of Multiple-Peril Crop Insurance For Your Farm

Multiple-Peril (also called Multi-Peril or MPCI) crop insurance helps farmers protect their income against whatever Mother Nature can throw at it. MPCI is created to deal with yield uncertainty – that is, the fact that the success of a farmer’s business is often at the disposal of something over which he has absolutely no control (the weather).

The way MCPI works in Canada is a bit more complex than other insurance plans. With MCPI, farmers choose a policy that covers a percentage of their average yield (usually 50, 60, 70, or 80 percent); they pay a portion of their insurance cost, and the government pays the rest. This combination of funding offers the grower financial incentive not to abuse the program, and it offers adequate resources in case of a true natural emergency – which is often catastrophic and far too expensive for any private individual or company to afford. This Canadian system of MCPI is modeled after the United States’ crop insurance program, which was implemented in 1981 and has proved extremely beneficial both to farmers and the American public.

If you are a farmer whose livelihood depends upon the success of a crop’s growth, you should definitely consider MPCI. While there are other risk management steps you can take to protect your business as a farmer, MPCI is arguably the most important because it not only accounts for price risks but also protects farmers from low yields. Most growers who run small to medium farms are great candidates for MPCI; the only farmers who might not need it are those who run farms that are successful enough or have enough capital to overcome a significant loss in case of unexpected damage to crops or loss of income.

As weather becomes more severe and unpredictable, crop insurance is an integral part of any agri-business. An experienced insurance agent can help figure out the best program, based on local risks and production history. Multi-peril crop insurance helps smooth out the ups and downs of being a farmer in Canada. Give Excalibur Insurance Group a call 519-348-9150 to review coverage and options for your Mississauga Farm Insurance .