[Federal Register Volume 61, Number 81 (Thursday, April 25, 1996)]
[Proposed Rules]
[Pages 18293-18299]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-10145]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 61, No. 81 / Thursday, April 25, 1996 /
Proposed Rules
[[Page 18293]]
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Part 457
RIN 0563-AB03
Common Crop Insurance Regulations; Pear Crop Insurance Provisions
AGENCY: Federal Crop Insurance Corporation.
ACTION: Proposed rule.
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SUMMARY: The Federal Crop Insurance Corporation (FCIC) proposes
specific crop provisions for the insurance of Pears. The provisions
will be used in conjunction with the Common Crop Insurance Policy Basic
Provisions which contains standard terms and conditions common to most
crops. The intended effect of this action is to provide policy changes
to better meet the needs of the insured and to include the current pear
endorsement with the Common Crop Insurance Policy for ease of use and
consistency of policy terms.
DATES: Written comments, data, and opinions on this proposed rule will
be accepted until close of business May 28, 1996 and will be considered
when the rule is to be made final. The comment period for information
collection under the Paperwork Reduction Act of 1995 continues through
June 24, 1996.
ADDRESSES: Interested persons are invited to submit written comments to
the Chief, Program Development Branch, Federal Crop Insurance
Corporation (FCIC), Farm Service Agency (FSA), United States Department
of Agriculture (USDA), 9435 Holmes Road, Kansas City, MO 64131. Written
comments will be available for public inspection and copying in room
0324, South Building, USDA, 14th and Independence Avenue SW.,
Washington, D.C., 8:15 a.m.-4:45 p.m., Monday through Friday.
FOR FURTHER INFORMATION CONTACT: Louise Narber, Program Analyst,
Research and Development Division, Product Development Branch, FCIC,
FSA, USDA, 9435 Holmes Road, Kansas City, MO 64131, telephone (816)
926-7730.
SUPPLEMENTARY INFORMATION:
Executive Order 12866 and Departmental Regulation 1512-1
This action has been reviewed under United States Department of
Agriculture (USDA) procedures established by Executive Order 12866 and
Departmental Regulation 1512-1. This action constitutes a review as to
the need, currency, clarity, and effectiveness of these regulations
under those procedures. The sunset review date established for these
regulations is February 1, 2001.
This rule has been determined to be exempt for the purposes of
Executive Order 12866 and therefore has not been reviewed by the Office
of Management and Budget (OMB).
Paperwork Reduction Act of 1995
The information collection requirements contained in these
regulations were previously approved by OMB pursuant to the Paperwork
Reduction Act of 1995 (44 U.S.C. Chapter 35) under OMB control number
0563-0003 through September 30, 1998.
The amendments set forth in this proposed rule do not contain
additional information collections that require clearance by the Office
of Management and Budget under the provisions of 44 U.S.C. Chapter 35.
The title of this information collection is ``Catastrophic Risk
Protection Plan and Related Requirements including, Common Crop
Insurance Regulations; Pear Crop Insurance Provisions.'' The
information to be collected includes: a crop insurance acreage report,
an insurance application and a continuous contract. Information
collected from the acreage report and application is electronically
submitted to FCIC by the reinsured companies. Potential respondents to
this information collection are growers of pears that are eligible for
Federal crop insurance.
The information requested is necessary for the insurance company
and FCIC to provide insurance, provide reinsurance, determine
eligibility, determine and collect premiums or other monetary amounts,
and pay benefits.
All information is reported annually. The reporting burden for this
collection of information is estimated to average 16.9 minutes per
response for each of the 3.6 responses from approximately 1,755,015
respondents. The total annual burden on the public for this information
collection is 2,676,932 hours.
The comment period for information collections under the Paperwork
Reduction Act of 1995 continues through June 24, 1996, for the
following: (a) whether the proposed collection of information is
necessary for the proper performance of the functions of the agency,
including whether the information shall have practical utility; (b) the
accuracy of the agency's estimate of the burden of the proposed
collection of information; (c) ways to enhance the quality, utility,
and clarity of the information to be collected; and (d) ways to
minimize the burden of the collection of information on respondents,
including through the use of automated collection techniques or other
forms of information technology.
Comments should be submitted to the Desk Officer for Agriculture,
Office of Information and Regulatory Affairs, Office of Management and
Budget (OMB), Washington, D.C. 20503 and to Bonnie Hart, Advisory and
Corporate Operations Staff, Regulatory Review Group, Farm Service
Agency, P.O. Box 2415, Ag Box 0572, U.S. Department of Agriculture,
Washington, D.C. 20013-2415, telephone (202) 690-2857. Copies of the
information collection may be obtained from Bonnie Hart at the above
address.
Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandate Reform Act of 1995 (UMRA), Pub. L.
104-4, establishes requirements for Federal agencies to assess the
effects of their regulatory actions on State, local, and tribal
governments and the private sector. Under section 202 of the UMRA, FCIC
generally must prepare a written statement, including a cost-benefit
analysis, for proposed and final rules with ``Federal mandates'' that
may result in expenditures to State, local, or tribal governments, in
the aggregate, or to the private sector, of $100 million or more in any
1 year. When such a statement is needed for a rule, section 205 of the
UMRA generally requires FCIC to identify and consider a reasonable
number of regulatory
[[Page 18294]]
alternatives and adopt the least costly, more cost-effective or least
burdensome alternative that achieves the objectives of the rule.
This rule contains no Federal mandates (under the regulatory
provisions of Title II of the UMRA) for State, local, and tribal
governments or the private sector. Thus, this rule is not subject to
the requirements of sections 202 and 205 of the UMRA.
Executive Order 12612
It has been determined under section 6(a) of Executive Order 12612,
Federalism, that this rule does not have sufficient federalism
implications to warrant the preparation of a Federalism Assessment. The
provisions contained in this rule will not have a substantial direct
effect on States or their political subdivisions, or on the
distribution of power and responsibilities among the various levels of
government.
Regulatory Flexibility Act
This regulation will not have a significant impact on a substantial
number of small entities. Under the current regulations, a producer is
required to complete an application and acreage report. If the crop is
damaged or destroyed, the insured is required to give notice of loss
and provide the necessary information to complete a claim for
indemnity. If the insured elects to use actual records of acreage and
production as the basis for the production guarantee, the insured may
elect to report this information on a yearly basis. This regulation
does not alter those requirements. Therefore, the amount of work
required of the insurance companies and FSA offices delivering and
servicing these policies will not increase significantly from the
amount of work currently required. This rule does not have any greater
or lesser impact on the insured. Therefore, this action is determined
to be exempt from the provisions of the Regulatory Flexibility Act (5
U.S.C. 605), and no Regulatory Flexibility Analysis was prepared.
Federal Assistance Program
This program is listed in the Catalog of Federal Domestic
Assistance under No. 10.450.
Executive Order 12372
This program is not subject to the provisions of Executive Order
12372 which require intergovernmental consultation with State and local
officials. See the Notice related to 7 CFR part 3015, subpart V,
published at 48 FR 29115, June 24, 1983.
Executive Order 12778
The Office of the General Counsel has determined that these
regulations meet the applicable standards provided in subsections 2(a)
and 2(b)(2) of Executive Order 12778. The provisions of this rule will
not have a retroactive effect prior to the effective date. The
provisions of this rule will preempt State and local laws to the extent
such State and local laws are inconsistent herewith. The administrative
appeal provisions of the National Appeals Division published in 7 CFR
part 11 must be exhausted before action for judicial review may be
brought.
Environmental Evaluation
This action is not expected to have a significant impact on the
quality of the human environment, health, and safety. Therefore,
neither an Environmental Assessment nor an Environmental Impact
Statement is needed.
National Performance Review
This regulatory action is being taken as part of the National
Performance Review initiative to eliminate unnecessary or duplicative
regulations and improve those that remain in force.
Background
FCIC proposes to add to the Common Crop Insurance Regulations (7
CFR part 457) a new section, 7 CFR part 457.111, Pear Crop Insurance
Provisions. The provisions will be effective for the 1997 and
succeeding crop years. The proposed Pear Crop Insurance provisions will
replace the provisions found at 7 CFR part 401.140 (Pear Endorsement).
Upon publication of 7 CFR part 457.111 as a final rule, the provisions
for insuring pears contained herein will supersede the current
provisions contained in 7 CFR part 401.140. By separate rule, FCIC will
revise 7 CFR part 401.140 to limit its effect to the 1996 crop year and
later remove that section.
This rule makes minor editorial and format changes to improve the
Pear Crop Insurance Endorsement's compatibility with the Common Crop
Insurance Policy. In addition, FCIC is proposing substantive changes in
the provisions for insuring pears as follows:
1. The Pacific Northwest grows several varieties of pears in
addition to Green Bartletts; however, other areas primarily grow Green
Bartletts. Therefore, varietal groups will be identified in the Special
Provisions and all references to type I and type II have been deleted.
2. Section 1--Add definitions for ``culls,'' ``days,'' ``direct
marketing,'' ``good farming practices,'' ``interplanted,'' ``irrigated
practice,'' ``marketable,'' ``production guarantee (per acre),''
``varietal group,'' and ``written agreement'' for clarification
purposes.
3. Section 2--Specify that optional units may be established by
section, section equivalent, or FSA Farm Serial Number; or by acreage
located on non-contiguous land, but not by both. This policy is
consistent with some other perennial crop provisions. Optional units
also may be established by varietal group when authorized by the
Special Provisions. The provision in section 7 of the Pear Endorsement
that prevented interplanted acreage of type I and type II from being
divided into separate units has been deleted because two or more
varieties which are interplanted may now be separate units. Production
records from each variety are kept separate and many varieties do not
mature at the same time. It is not realistic or necessary to allow
units by blocks of different varieties but not allow units when
different varieties are interplanted within a block.
4. Section 3(a)--Clarify that an insured may select only one price
election for all the pears in the county insured under this policy,
unless the Special Provisions provide different price elections by
varietal group in which case the insured may select one price election
for each varietal group designated in the Special Provisions. Each
price election chosen for each varietal group must have the same
percentage relationship to the maximum price offered by the insurer.
5. Section 3(b)--Add provisions for reporting the age and type, if
applicable, of any interplanted perennial crop, its planting pattern,
and any other information needed to establish the yield upon which the
production guarantee is based. If the insured fails to notify the
insurer of factors that may reduce yields from previous levels, the
insurer will reduce the production guarantee at any time the insurer
becomes aware of damage, removal of trees, or changes in practices.
Interplanting is not allowed under the current Pear Endorsement.
6. Section 4--Change the contract change date in California from
August 31 to October 31 to be consistent with other perennial crops in
California.
7. Section 5--Change the cancellation and termination dates in
California from November 20 to January 31 to be consistent with other
perennial crops in California.
8. Section 6--Specify that to be insurable, the pears must be grown
on trees that have produced an average of at least 5 tons per acre, in
at least 1 of
[[Page 18295]]
the 4 previous crop years unless the Special Provisions or a written
agreement set a lower threshold. Previous provisions required that the
type must produce an average of 4 tons of pears per acre of first grade
canning or U.S. Number 1 in at least 1 of the 4 previous crop years to
be insurable. The change to 5 tons per acre is being proposed as more
characteristic of an orchard reaching a level of production which
should continue on an up trend. Four tons per acre is not an adequate
indicator that the orchard has passed problems typical of a new
orchard. The ``of first grade canning or U.S. Number 1'' requirement
will be eliminated because it does not include U.S. No. 2 grade pears
that are included in the production to count. The provision that
required acceptable production records for insurance to attach also
will be eliminated because if the insured does not provide acceptable
records of production the guarantee may be based on a transitional
yield in accordance with Actual Production History regulations
published at 7 CFR part 400, subpart G.
9. Section 7--Add a provision to make interplanted pears insurable
if planted with another perennial crop unless the insurance provider
inspects the acreage and determines it does not qualify to be accepted
for insurance coverage. This provision was added to provide insurance
coverage to the maximum extent to all pear producers, and to reduce the
number of acres that would require coverage under the Non-insured
Assistance Program (NAP).
10. Section 8--Modify the insurance period in California so
coverage will begin the later of the date the application is accepted
or February 1, instead of November 21, since the cancellation and
termination dates were changed to January 31 and the contract change
date was changed to October 31. Provisions also were added for insuring
acreage when an insurable share is acquired or relinquished on or
before the acreage reporting date. Under the current Pear Endorsement
for acreage acquired (for which an application is in place) on or
before the acreage reporting date, coverage would attach at the time
the insurer considers the crop inspection as being acceptable provided
it was on or after November 21. In the same situation under these new
provisions (in all States except California), coverage will have
started on November 21 even if the insurer considers the inspection as
being acceptable on January 14. Under the current Pear Endorsement for
acreage relinquished on or before the acreage reporting date but after
coverage had attached, the premium would still be due from the insured
even if the insured no longer had an insurable interest. In the same
situation under these new provisions, insurance will not be considered
to have attached so the premium will not be due unless a transfer of
right to an indemnity was completed.
11. Section 9(a)--Add adverse weather conditions as a cause of loss
and delete drought, excess wind, freeze, frost, fruit-set failure and
hail because they are included by the term adverse weather. Also add a
clause to the insurable cause of loss ``failure of the irrigation water
supply'' to limit it to a cause of loss covered by this policy.
12. Section 9(b)--Add disease and insect infestation to the
excluded causes of loss unless adverse weather prevents the proper
application of control measures, causes control measures to be
ineffective when properly applied, or no effective control mechanism is
available for such disease or insect infestation. These exclusions need
to be added for clarification so that insurance coverage is not
provided for causes of loss that could be prevented.
13. Section 10--Require the producer to give notice within 3 days
of the date harvest should have started if the crop will not be
harvested. It also requires the producer to give notice at least 15
days prior to harvest so a preharvest inspection can be made if the
insured intends to sell fruit directly to retail customers in any
manner. This appraisal may be used to determine the amount of
production to count in a loss situation.
14. Section 11--Add a provision explaining when potential
production on abandoned acreage will be included in total production to
count. If the insured and the insurer agree on potential production on
acreage the insured wishes to abandon or no longer care for, the
insurance period for that acreage will end. If agreement is not
reached, the claim may be deferred if the insured agrees to continue to
care for the crop. The insurance provider will make another appraisal
when the insured notifies them of further damage or that harvest is
generally occurring in the area unless the crop is harvested in which
case the harvested production will be used to determine the production
to count. If the insured does not continue to care for the crop, the
appraisal made prior to deferring the claim will be used to determine
the production to count. Also for purposes of settling a claim in all
States except California, the production to count is all the harvested
and appraised marketable production. There is no adjustment for quality
unless the ``Quality Adjustment Endorsement'' is elected. For
California, references to the California Tree Fruit Agreement
Standards, which is obsolete, have been changed to the California Pear
Advisory Board.
15. Section 12--Add provisions for providing insurance coverage by
written agreement. FCIC has a long-standing policy of permitting
modification of insurance contracts by written agreement. This
provision is not documented in the current Pear Endorsement. Section 12
will discuss application for, and duration of, written agreements.
16. Section 13--Provide for a quality adjustment endorsement for
all States, except California, if the insured meets the following: has
limited or additional coverage, pays the additional premium, the pears
are damaged by volcano eruption, frost, freeze, wind or hail, and the
endorsement is timely elected. The current pear provisions, without a
quality adjustment endorsement, are appropriate in California because
the primary marketing intent for pears grown in California is for fresh
pack and then to market the pears that do not make U.S. No. 1 as
processing or as juice. Also the California pear growers generally have
records available for the most recent crop year in the base period. In
the Pacific Northwest records for the most recent crop year in the base
period are not available as winter pears go into controlled atmospheric
storage and may not sell or be graded until well into the next calendar
year. Also, the Pacific Northwest has widespread fire blight problems,
and the quality adjustment endorsement will allow a more reflective
yield of the orchards.
List of Subjects in 7 CFR Part 457
Crop insurance, Pears.
Proposed Rule
Pursuant to the authority contained in the Federal Crop Insurance
Act, as amended (7 U.S.C. 1501 et seq.), the Federal Crop Insurance
Corporation hereby proposes to amend the Common Crop Insurance
Regulations (7 CFR 457), effective for the 1997 and succeeding crop
years, as follows:
PART 457--[AMENDED]
1. The authority citation for 7 CFR 457 continues to read as
follows:
Authority: 7 U.S.C. 1506(l), 1506(p).
2. 7 CFR 457 is amended by adding a new Sec. 457.111 to read as
follows:
[[Page 18296]]
Sec. 457.111 Pear Crop Insurance Provisions.
The Pear Crop Insurance Provisions for the 1997 and succeeding crop
years are as follows:
United States Department of Agriculture
Federal Crop Insurance Corporation
Pear Crop Provisions
If a conflict exists among the Basic Provisions (Sec. 457.8), these
crop provisions, and the Special Provisions, the Special Provisions
will control these crop provisions and the Basic Provisions; and these
crop provisions will control the Basic Provisions.
1. Definitions
Culls--Pears that do not meet the requirements of U.S. No. 2 grade
or better.
Days--Calendar days.
Direct Marketing--Sale of the insured crop directly to consumers
without the intervention of an intermediary such as a wholesaler,
retailer, packer, processor, shipper, or buyer. Examples of direct
marketing include selling through an on-farm or roadside stand or a
farmer's market, and permitting the general public to enter the
field(s) for the purpose of picking all or a portion of the crop.
FSA--Farm Service Agency of the United States Department of
Agriculture.
Good farming practices--The cultural practices generally in use in
the county for the crop to make normal progress toward maturity and
produce at least the yield used to determine the production guarantee
and are those generally recognized by the Cooperative Extension Service
as compatible with agronomic and weather conditions in the county.
Harvest--The picking of mature pears from the trees or the
collecting of marketable pears from the ground.
Interplanted--Acreage on which two or more crops are planted in any
form of alternating or mixed pattern.
Irrigated practice--A method of producing a crop by which water is
artificially applied during the growing season by appropriate systems
and at the proper times, with the intention of providing the quantity
of water needed to produce at least the yield used to establish the
irrigated production guarantee on the irrigated acreage planted to the
insured crop.
Marketable--Pear production acceptable for processing or other
human consumptive use even if it does not meet any U.S. or applicable
state grading standard.
Non-contiguous land--Any land owned by you or rented by you for any
consideration other than a share in the insured crop, whose boundaries
do not touch at any point. Land that is separated only by a public or
private right-of-way, waterway or irrigation canal will be considered
to be touching.
Production guarantee (per acre)--The quantity of pears (in tons)
determined by multiplying the approved yield per acre by the coverage
level percentage you elect, and multiplying the result by any
applicable adjustment factor provided for in section 6(b)(f) of the
Basic Provisions (Sec. 457.8).
Ton--Two thousand (2,000) pounds avoirdupois.
Varietal Group--Types of pears with similar characteristics that
are grouped for insurance purposes as specified in the Special
Provisions.
Written agreement--A written document that alters designated terms
of a policy.
2. Unit Division
Unless limited by the Special Provisions, a unit as defined in
section 1 (Definitions) of the Basic Provisions (Sec. 457.8) (basic
unit), may be divided into optional units if, for each optional unit
you meet all the conditions of this section or if a written agreement
to such division exists. Basic units may not be divided into optional
units on any basis including, but not limited to, production practice,
type, and variety, other than as described in this section. If you do
not comply fully with these provisions, we will combine all optional
units that are not in compliance with these provisions into the basic
unit from which they were formed. We will combine the optional units at
any time we discover that you have failed to comply with these
provisions. If failure to comply with these provisions is determined to
be inadvertent, and the optional units are combined, that portion of
the premium paid for the purpose of electing optional units will be
refunded to you pro rata for the units combined. All optional units
must be identified on the acreage report for each crop year.
(a) The following requirements must be met for each optional unit:
(1) You must have records, which can be independently verified, of
acreage and production for each optional unit for at least the last
crop year used to determine your production guarantee; and
(2) You must have records of marketed production or measurement of
stored production from each optional unit maintained in such a manner
that permits us to verify the production from each optional unit or the
production from each unit must be kept separate until loss adjustment
is completed by us.
(b) Each optional unit must meet one or more of the following
criteria as applicable:
(1) Optional Units by Section, Section Equivalent, or Farm Service
Agency (FSA) Farm Serial Number: Optional units may be established if
each optional unit is located in a separate legally identified section.
In the absence of sections, we may consider parcels of land legally
identified by other methods of measure including, but not limited to
Spanish grants, railroad surveys, leagues, labors, or Virginia Military
Lands, as the equivalent of sections for unit purposes. In areas that
have not been surveyed using the systems identified above, or another
system approved by us, or in areas where such systems exist but
boundaries are not readily discernable, each optional unit must be
located in a separate farm identified by a single FSA Farm Serial
Number; or
(2) Optional Units on Acreage Located on Non-Contiguous Land:
Instead of establishing optional units by section, section equivalent
or FSA Farm Serial Number, optional units may be established if each
optional unit is located on non-contiguous land.
(3) Optional Units on Acreage by Varietal Group: In addition to, or
instead of, establishing optional units by section, section equivalent,
FSA Farm Serial Number, or on non-contiguous land, optional units may
be established by varietal Group when provided for in the Special
Provisions.
3. Insurance Guarantees, Coverage Levels, and Prices for Determining
Indemnities
In addition to the requirements of section 3 (Insurance Guarantees,
Coverage Levels, and Prices for Determining Indemnities) of the Basic
Provisions (Sec. 457.8):
(a) You may select only one price election for all the pears in the
county insured under this policy unless the Special Provisions provide
different price elections by varietal group, in which case you may
select one price election for each varietal group designated in the
Special Provisions. The price election you choose for each varietal
group must have the same percentage relationship to the maximum price
offered by us for each varietal group. For example, if you choose one
hundred percent (100%) of the maximum price election for a specific
varietal group, you must also choose one hundred percent (100%) of the
[[Page 18297]]
maximum price election for all other varietal groups.
(b) You must report, by the production reporting date designated in
section 3 (Insurance Guarantees, Coverage Levels, and Prices for
Determining Indemnities) of the Basic Provisions (Sec. 457.8), by
varietal group:
(1) Any damage, removal of trees, or change in practices that may
reduce yields from previous levels, and the number of affected acres;
(2) The number of trees on insurable and uninsurable acreage;
(3) The age of the trees and the planting pattern; and
(4) For the first year of insurance for acreage interplanted with
another perennial crop and anytime the planting pattern of such acreage
is changed:
(i) The age of the interplanted crop, and type if applicable;
(ii) The planting pattern; and
(iii) Any other information that we request in order to establish
your approved yield.
We will reduce the yield used to establish your production
guarantee as necessary, based on the effect of the interplanted
perennial crop, removal of trees, damage, or change in practices on the
yield potential of the insured crop. If you fail to notify us of
factors that may reduce yields from previous levels, we will reduce
your production guarantee as necessary at any time we become aware of
the interplanted crop, removal of trees, damage, or change in
practices.
4. Contract Changes
The contract change date is October 31 preceding the cancellation
date for states with a January 31 cancellation date and August 31
preceding the cancellation date for all other states (see the
provisions of section 4 (Contract Changes) of the Basic Provisions
(Sec. 457.8)).
5. Cancellation and Termination Dates
In accordance with section 2 (Life of Policy, Cancellation, and
Termination) of the Basic Provisions (Sec. 457.8), the cancellation and
termination dates are:
------------------------------------------------------------------------
Cancellation and termination
States dates
------------------------------------------------------------------------
California................................ January 31.
All other states.......................... November 20.
------------------------------------------------------------------------
6. Insured Crop
In accordance with section 8 (Insured Crop) of the Basic Provisions
(Sec. 457.8), the crop insured will be all the pears in the county for
which a premium rate is provided by the actuarial table:
(a) In which you have a share;
(b) That are of varieties adapted to the area;
(c) That are grown on trees that have produced an average of at
least five (5) tons of pears per acre in at least one of the four
previous crop years unless the Special Provisions or a written
agreement authorizes lesser production; and
(d) That are grown in an orchard that, if inspected, is considered
acceptable by us.
7. Insurable Acreage
In lieu of the provisions in section 9 (Insurable Acreage) of the
Basic Provisions (Sec. 457.8), that prohibit insurance attaching to a
crop planted with another crop, pears interplanted with another
perennial crop are insurable unless we inspect the acreage and
determine it does not meet insurability requirements.
8. Insurance Period
(a) In accordance with the provisions of section 11 (Insurance
Period) of the Basic Provisions (Sec. 457.8):
(1) Coverage begins for each crop year on the later of the date we
accept your application or:
(i) In California, on February 1; or
(ii) In all other states, on November 21.
(2) The calendar date for the end of the insurance period for each
crop year is:
(i) September 15 for Bartlett (green and red) and Star Crimson
(Crimson Red) varietal groups; or
(ii) October 15 for all other varietal groups.
(b) In addition to the provisions of section 11 (Insurance Period)
of the Basic Provisions (Sec. 457.8):
(1) If you acquire an insurable share in any insurable acreage on
or before the acreage reporting date of any crop year and if we
inspect, and consider the acreage acceptable, insurance will be
considered to have attached to such acreage on the calendar date for
the beginning of the insurance period.
(2) If you relinquish your insurable interest on any acreage of
pears on or before the acreage reporting date of any crop year
insurance will not be considered to have attached to such acreage for
that crop year unless:
(i) A transfer of right to an indemnity or a similar form approved
by us is completed by all affected parties; and
(ii) The insurance provider is notified by you or the transferee in
writing of such transfer on or before the acreage reporting date.
9. Causes of Loss
(a) In accordance with the provisions of section 12 (Causes of
Loss) of the Basic Provisions (Sec. 457.8), insurance is provided only
against the following causes of loss that occur within the insurance
period:
(1) Adverse weather conditions;
(2) Fire, unless weeds and other forms of undergrowth have not been
controlled or pruning debris has not been removed from the orchard;
(3) Earthquake;
(4) Volcanic eruption; or
(5) Failure of the irrigation water supply, if caused by an insured
peril that occurs during the insurance period.
(b) In addition to the causes of loss excluded in section 12
(Causes of Loss) of the Basic Provisions (Sec. 457.8), we will not
insure against damage or loss of production due to:
(1) Disease or insect infestation, unless adverse weather:
(i) Prevents the proper application of control measures or causes
properly applied control measures to be ineffective; or
(ii) Causes disease or insect infestation for which no effective
control mechanism is available.
(2) Failure of the fruit to color properly; or
(3) Inability to market the pears for any reason other than actual
physical damage from an insurable cause specified in this section. For
example, we will not pay you an indemnity if you are unable to market
due to quarantine, boycott, or refusal of any person to accept
production.
10. Duties in the Event of Damage or Loss
In addition to the requirements of section 14 (Duties in the Event
of Damage or Loss) of the Basic Provisions (Sec. 457.8), the following
will apply:
(a) You must notify us within 3 days of the date harvest should
have started if the crop will not be harvested.
(b) You must notify us at least 15 days before harvest begins if
any production from any unit will be marketed directly to consumers. We
will conduct a preharvest appraisal that will be used to determine your
production. If damage occurs after the preharvest appraisal, and you
can provide acceptable records to us that account for all production
removed from the unit after our appraisal, we will conduct an
additional appraisal that will be used to determine your production.
Failure to give timely notice that production will be marketed directly
to consumers will result in an appraised amount of production to count
of not less than the production guarantee per acre.
(c) If you intend to claim an indemnity on any unit, you must
notify us prior to the beginning of harvest so
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that we may inspect the damaged production. You must not sell or
dispose of the damaged crop until after we have given you written
consent to do so. If you fail to meet the requirements of this
subsection, all such production will be considered undamaged and
included as production to count.
11. Settlement of Claim
(a) We will determine your loss on a unit basis. In the event you
are unable to provide production records:
(1) For any optional unit, we will combine all optional units for
which acceptable records of production were not provided; or
(2) For any basic unit, we will allocate any commingled production
to such units in proportion to our liability on the harvested acreage
for each unit.
(b) In the event of loss or damage covered by this policy, we will
settle your claim by:
(1) Multiplying the insured acreage by its respective production
guarantee;
(2) Multiplying each product by the respective price election;
(3) Summing all such products;
(4) Multiplying the total production to be counted of each varietal
group (see subsection 11(c)) by the respective price election;
(5) Summing all such products;
(6) Subtracting this total from the total in (3); and
(7) Multiplying the result by your share.
(c) The total production to count (in tons) from all insurable
acreage on the unit will include:
(1) All appraised production as follows:
(i) Not less than the production guarantee per acre for acreage:
(A) That is abandoned;
(B) Damaged solely by uninsured causes; or
(C) For which you fail to provide production records that are
acceptable to us;
(ii) Production lost due to uninsured causes;
(iii) Unharvested production; and
(iv) Potential production on acreage that you intend to abandon or
no longer care for, if you and we agree on the appraised amount of
production. Upon such agreement, the insurance period for that acreage
will end. If you do not agree with our appraisal, we may defer the
claim only if you agree to continue to care for the crop. We will then
make another appraisal when you notify us of further damage or that
harvest is generally occurring in the area unless you harvested the
crop, in which case we will use the harvested production. If you do not
continue to care for the crop, our appraisal made prior to deferring
the claim will be used to determine the production to count; and
(2) For all states except California, all harvested and appraised
marketable pear production from the insurable acreage.
(3) For California, all harvested and appraised production that:
(i) Meets the standards for first grade canning as defined by the
California Pear Advisory Board or for U.S. Number 1 as defined by the
United States Standards for Grades of Summer and Fall Pears, or Pears
for Processing, or for U.S. Extra Number 1 or U.S. Number 1 as defined
by the United States Standards for Grades of Winter Pears; or
(ii) Is accepted by a processor for canning or packing; or
(iii) Is marketable for any purpose.
(4) For California, notwithstanding the terms of 11(c)(3), if the
cause of loss was due to an insurable cause, the quantity of production
that otherwise would be considered as production to count will be
reduced by whichever of the following methods results in the least
production to count:
(i) By the excess over ten percent (10%) of the total production
from the unit of varieties other than Forelle, Seckel or Winter Nelis
that is size 180 or smaller as defined in the United States Standards
for Summer and Fall Pears or for Winter Pears; or
(ii) By dividing the value per ton by the highest price election
available for the insured varietal group that does not meet the
specifications of section 11(c)(3)(i), subtracting this result from
1.000, multiplying this difference by the number of tons of such pears
and subtracting this result from the production to count.
12. Written Agreements
Designated terms of this policy may be altered by written
agreement. The following conditions will apply:
(a) You must apply in writing for each written agreement no later
than the sales closing date, except as provided in subsection (e) of
this section.
(b) The application for written agreement must contain all terms of
the contract between you and us that will be in effect if the written
agreement is not approved.
(c) If approved, the written agreement will include all variable
terms of the contract, including, but not limited to, crop type or
variety, the guarantee, premium rate, and price election.
(d) Each written agreement will only be valid for 1 year. If the
written agreement is not specifically renewed the following year,
insurance coverage for subsequent crop years will be in accordance with
the printed policy.
(e) An application for written agreement submitted after the sales
closing date may be approved if, after a physical inspection of the
acreage, it is determined that no loss has occurred and the crop is
insurable in accordance with the policy provisions.
13. Pear Quality Adjustment Endorsement
(a) The provisions of this endorsement apply if:
(1) You elect the Pear Quality Adjustment Endorsement on your
application or on a form approved by us, on or before the sales closing
date for the initial crop year in which you wish to insure your pears
under this endorsement. By doing so, you agree to pay the additional
premium designated in the actuarial table for this optional coverage;
and
(2) This endorsement is not excluded by your policy.
(b) This endorsement is available in all counties for which the
actuarial table designates pear premium rates, except for counties in
California. This endorsement does not cover acreage insured under the
Catastrophic Risk Production Endorsement in any counties.
(c) Pears damaged by volcano eruption; frost; freeze; wind; or hail
are eligible for quality adjustment, subject to the following:
(1) If the harvested and appraised production does not grade eighty
percent (80%) U. S. No. 2 or better in accordance with applicable
United States Standards for Grades of Summer and Fall Pears, United
States Standards for Grades of Winter Pears, or United States Standards
for Grades of Pears for Processing, as applicable, production will be
reduced as follows:
(i) By two percent (2%) for each full one percent (1%) in excess of
twenty percent (20%), when twenty-one percent (21%) through sixty
percent (60%) of the pears fail the grade standard; and
(ii) By one hundred percent (100%) when more than sixty percent
(60%) of the pears fail the grade standard. The difference between the
reduced production and the total production will be considered cull
production.
(2) Pears that are knocked to the ground by wind or frozen and
cannot be packed or marketed as fresh pears will be considered one
hundred percent (100%) cull production.
(3) Fifteen percent (15%) of all production that is considered cull
production will be production to count.
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(4) No reduction in grade will be recognized for any pears that
fail the grade standard due to uninsurable causes of loss.
(d) This endorsement may be canceled by either you or us for any
succeeding crop year by giving written notice on or before the
cancellation date preceding the crop year for which the cancellation of
this endorsement is to be effective.
Signed in Washington, D.C., on April 18, 1996.
Kenneth D. Ackerman,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 96-10145 Filed 4-24-96; 8:45 am]
BILLING CODE 3410-FA-P
