Enhanced Quality Option

Purpose

The Enhanced Quality Option provides producers of high quality alfalfa the opportunity to purchase an additional Relative Feed Value (RFV) guarantee for alfalfa.

Eligibility

The Enhanced Quality Option is available to Manitoba producers with alfalfa acres insured under Select Hay Insurance, and have demonstrated that they have produced high quality hay in the past three years.
Production must be placed into acceptable storage. For example: bales must be wrapped, tarped, or shedded.

Coverage

Producers with Select Hay Insurance can add the Enhanced Quality Option, which allows them to increase their RFV coverage above the Select Hay RFV guarantee of .
Assigned RFV for is .
Every new producer in will start with an assigned RFV of . For each claim-free year, a producer’s assigned RFV increases by five points to a maximum of . For each claim year, a producer’s assigned RFV decreases by five points to a minimum of .

RFV guarantee is calculated:

RFV guarantee	= (assigned RFV - Select Hay RFV guarantee) x % + Select Hay RFV guarantee = ( - ) x + = (rounded)

Coverage (cont'd)

RFV coverage is calculated:

RFV coverage	= (RFV guarantee - Select Hay RFV guarantee) x tonnes of Select Hay alfalfa coverage

Claims are calculated based on a $ per tonne for each RFV point below the assigned RFV.
March 31 is the last day to apply for the Enhanced Quality Option. Once selected, the Enhanced Quality Option renews automatically each year until the producer cancels the option.
Yields must be reported to MASC on a producer's Harvested Production Report by November 30.

Cost

RFV testing is done by MASC at no cost to producers.
The premium cost is shared per cent by the producer, per cent by the Government of Canada, and per cent by the Province of Manitoba.

Claims

A producer is entitled to a claim if their attained RFV is less than his RFV coverage.
Claims for the Enhanced Quality Option must be registered with MASC by October 1 (without penalty).
A producer’s attained RFV will be based on individual lots of alfalfa, where production with the highest RFV is counted first for claim purposes, and continues until the tonnes accounted for equals tonnes covered under Select Hay Insurance.

Claim Example:

A producer insures acres of alfalfa with a total production coverage of tonnes. The producer actually harvests a total of tonnes, with tonnes that exceed the RFV guarantee and tonnes with an RFV of ( points below the RFV guarantee).

RFV Shortfall	= RFV guarantee - actual RFV = - = RFV shortfall points
Claim Tonnage	= tonnes of coverage - tonnes lower than 128 RFV = shortfall tonnes
Claim Amount	= shortfall tonnes x dollar value x RFV shortfall points = tonnes x $ x = $

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