Crop Insurance Now Available For Hemp

Farmers of various crops across the country routinely rely on insurance to protect them against unavoidable catastrophic losses. These losses are caused by a variety of phenomena from natural disasters to economic turmoil. Without this insurance, many farmers would simply be unable to stay in business in the event of a bad season. Up until recently, farmers whose principal crop was hemp have been unable to purchase crop insurance. Thankfully, there are now two separate crop insurance programs available to hemp farmers in certain counties within 21 states across the nation. These pilot programs were developed by United States Department of Agriculture (USDA) earlier this year in the hopes of testing out feasibility and viability of a permanent, long-term insurance option for hemp farmers. Both programs are outlined below.

Multi-Peril Crop Insurance Pilot Insurance Program (MPCI)

The MPCI pilot insurance program is a new crop insurance option for producers of hemp in select counties in Oregon, California, Colorado and roughly 20 other states. Along with other requirements, in order to be eligible for the pilot program, a producer must have been producing hemp for at least one year and must possess a contract for the sale of the insured hemp. Also, there is a minimum acreage requirement: 20 acres for fiber and grain, and 5 acres for CBD. Unfortunately, under MPCI, hemp does not qualify for replant payments or prevented plant payments.

Under the Whole-Farm Revenue Protection (WFRP) insurance plan, coverage is available to hemp growers in addition to revenue protection. Additionally, beginning with the 2021 crop year, hemp will be insurable via Nursery Crop Insurance and Nursery Value Select. Under both nursery programs, hemp will be insurable if grown in containers in accordance with federal regulations, applicable state or tribal laws, and the terms of the selected crop insurance policy.

Noninsured Crop Disaster Assistance Program (NAP)

Where no permanent federal crop insurance program is available, NAP offers coverage for loss of hemp grown for grain, fiber, seed or CBD for the 2020 crop year. This program mostly covers catastrophic losses due to weather or natural disasters. NAP offers 50/55 coverage against insurable losses, meaning that if production for a season falls under 50% of a farm’s average yield, losses are paid at a rate of 55% of the highest price election. Protection for up to 65/100 is also available.


Hemp crops testing over the federal THC limit of 0.3% will not be covered under the programs. Further, all producers must possess a license to grow hemp and must be in compliance with all applicable federal, state and tribal regulations. Visit USDA’s website for more information on eligibility for both insurance options.

Aaron Pelley

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