§ 400.250 - General statement.

The Disaster Assistance Act of 1988, subsequent disaster acts and disaster provisions in subsequent acts and the Rural Development Act (7 U.S.C. 1961 et seq.) have required that, subject to certain provisions in those enactments, procedures on a farm, in order to be eligible to receive benefits under the various provisions, would be required to purchase Federal crop insurance when the disaster for which benefits are being obtained are related to a peril which should be covered under the insurance policy. Most of these legislative provisions require that regulations be promulgated to provide for a reduction in the commissions paid to private insurance agents, brokers, or companies on contracts for crop insurance entered into under such disaster provisions. Said reductions must be sufficient to reflect that such insurance contracts principally involve only a servicing function to be performed by the agent, broker, or company.