Weaned Calf Risk Protection (WCRP) is coming in 2024 for cow-calf producers. It will be available as a pilot program in four states for the 2024 spring calving season: South Dakota, Nebraska, Colorado, and Texas. The program is one of several livestock-based products created by USDA’s Risk Management Agency (RMA) in response to recent federal farm legislation.
Farmers and ranchers in those states will need to sign up by Jan. 31, 2024, with a local private livestock insurance agent.
“The cow-calf sector has been historically underserved in risk management programs,” says Marcia Bunger, the administrator of RMA. “We’ve spent about three years developing WCRP, and now we’re ready to launch it in these four states and focus on learning. Who purchases WCRP? What are the challenges? What are the successes? What losses are paid? We’ll adjust as needed and hopefully be able to offer it in more states after that.”
Interested cow-calf producers in the pilot states will need to find a private insurance agent before Jan. 31, and discuss how WCRP could work for them. The livestock agent may be the same one you use for your other farm insurance. If you don’t have an agent who offers WCRP, you can inquire at your local USDA Service Center, or visit the agent locator tool on the RMA website.
Recordkeeping for WCRP
Like crop insurance, WCRP will rely on your actual production history (APH) for calves born, weaned, and sold. Any losses paid will be based on that. Bunger says, the first step is to gather those records, preferably going back four to 10 years. Auction barn receipts and weights will be most useful. In some cases, she says, county-wide averages can be used when records are not available.
As calving starts, keep good records of calves born and losses as they occur. Losses should be reported as promptly as possible to your insurance agent, just like you report other losses to an insurance company.
What does WCRP cover?
Indemnities will be paid for losses that exceed your deductible as a result of natural causes named in your policy, Bunger says. The policy provides coverage of revenue losses to perils such as drought, floods, diseases, or blizzards. Losses can be due to animal deaths, since that impacts overall production, or loss of weight or production to the natural disaster.
“If you have losses that are out of your control, then you have a claim,” she says. “You still have to provide good management to your cattle. If the loss is due to something that you should have tended to, and didn’t, then you won’t have an approved cause of loss.”
You’ll need to clarify with your insurance agent about loss reporting requirements and the timing. They may require third-party verification of death losses by a veterinarian or loss adjuster. A final indemnity for losses will typically be paid after a full accounting of the calves and their weights after weaning.
As with other federal crop insurance, you’ll have a range of coverage that you can insure at between 50% and 85% of your herd average weaning weight and revenue. The higher the coverage, the higher the premium.
“Every producer is different in the level of risk they are comfortable with,” says Bunger. “You’ll want to talk that through with your insurance agent. If you have a lender, you may want to get them involved, too, about the level of coverage that is right for you.”
What is the cost of WCRP?
Premiums for WCRP insurance will be subsidized by the federal government to a similar degree as other crop insurance programs. The RMA website has a cost estimator tool that may be helpful, but you’ll get the actual quote when you talk to your insurance agent.
Bunger and her husband, Roger, have their own crop and cow-calf farm in southeast South Dakota with 200 cows. She knows from her own neighborhood and experience that every producer is different when it comes to risk tolerance and vulnerability. That’s why WCRP was not designed to be a one-size-fits-all insurance option, she says.
“Some producers are in position to survive a year of bad storms that lead to calf losses. But some producers, especially those who are younger or newer to the business and more highly leveraged, can’t tolerate as much risk. It’s designed to let you choose a level of coverage so you can sleep at night, and everybody is different on that,” she says.
The innovator of the new cow-calf insurance program predicts it will be a game-changer
The new Weaned Calf Risk Protection (WCRP) insurance program for cow-calf producers started as the brainchild of Windmark, a private agribusiness insurance company, and Nebraska insurance agent Bill Halligan.
Windmark president Kelly Deterding then teamed with AgriLogic Consulting, a risk analysis and crop insurance development company, to further develop the concept and present it to USDA’s Risk Management Agency. The program has been approved and implemented for producers in four states — South Dakota, Nebraska, Colorado, and Texas — for the 2024 spring calving season.
Successful Farming recently interviewed Deterding by email about this new insurance product.
SF: How will WCRP be helpful to cow-calf producers?
KD: Prior to this, a cow-calf producer had no meaningful risk protection options. WCRP will offer a true revenue protection plan that protects against both yield loss, such as reduced weaning weight, and price. This is a policy that you can take to your lender with confidence that you now have a risk protection plan that covers multiple perils and price.
SF: How can producers prepare for WCRP?
KD: It is best if a producer has records to verify previous years weaning weights. Gather those records and take them to your insurance agent.
SF: What will WCRP cost?
KD: That will vary by region and state, but the policy will be very affordable like the other crop insurance policies. The discounts [from federal subsidies] are similar to others available to producers who insure things like corn, wheat, soybeans, or cotton. Discounts will vary by the level of coverage chosen by the policyholder.
Like other government insurance policies, the producer will pay the premium toward the end of the year, not up front.
SF: Any advice for producers thinking about using WCRP?
KD: This coverage will be a game-changer for cow-calf operators throughout the U.S. It will be especially helpful for the beginning farmers and ranchers who are partnered with a financial institution. Lenders will see the immediate value of this product and what it can do for the customer’s balance sheet.