Excess Moisture Insurance

Excess Moisture Insurance

Overview

excess moisture in field

Excess Moisture Insurance (EMI) compensates producers who cannot seed their crops before June 20 due to excessively wet conditions. In 2000, the Manitoba Agricultural Services Corporation introduced EMI to Manitoba producers as a basic component of the AgriInsurance program.

EMI has a standard deductible of 5% of the total acres available for seeding. MASC will adjust your deductible according to your recent EMI claim history.

A Reduced Deductible Option is available that allows you to buy-down your deductible to 5%.

The EMI program also has a High Dollar Value Option that allows you to buy-up coverage from the basic $50 per acre to $75 or $100 per acre.

Notes for the 2017 Crop Year:
  • The deadline for making changes to EMI options for the 2017 crop year was Wednesday, November 30, 2016.
  • Rented land must be added to your AgriInsurance contract by March 31, 2017 to be eligible for EMI coverage in 2017. Rented land added after March 31, 2017 will continue to be eligible for AgriInsurance coverage for seeded crops and Hail Insurance, but not EMI.
  • Land purchased on or before June 30 of the crop year is eligible for EMI.

Excess Moisture Insurance Factsheet

Getting Started

You first need to sign up for an AgriInsurance contract at your local MASC Insurance office. By default, you'll be assigned a standard EMI deductible of 5%, which in future will be adjusted according to your EMI claim history.

Changes to EMI options (Reduced Deductible Option, High Dollar Value Option) that you wish to make must be made by November 30 prior to the crop year. If you're new to AgriInsurance and no changes are made before this date, you will be assigned the standard EMI deductible of 5% with no options enabled.

If you have previous experience in AgriInsurance and no changes are made before November 30, you will be assigned your adjusted EMI deductible and the options you selected from the previous crop year.

Rented land must be added to your AgriInsurance contract by March 31 of the crop year to be eligible for EMI.

Purchased land will be eligible for EMI if it's added to your AgriInsurance contract before June 30 of the crop year.

If your unseeded acreage is greater than 10 acres and greater than your deductible, you will receive an indemnity.

Related:

Eligibility

Eligible Producers

All producers insured by MASC (including landlords with a crop share agreement) are provided with EMI coverage.

All acres that are normally available for spring seeding are eligible. Acreage under sod, pasture or perennial forage is only eligible for EMI, provided such acreage is destroyed by June 10th and is ready for spring seeding.

You're eligible for an EMI claim if you're unable to seed (before June 20th) due to excessively wet conditions (with a minimum of 10 unseeded acres). A deductible is calculated based on all eligible acres. The number of acres affected by excessive moisture must exceed the deductible before a claim is in effect.

Eligible Land

All acreage available for crop seeding is eligible for EMI, except:

  • acreage under bush, brush, fall rye or winter wheat, unless it was destroyed the previous year and is ready for seeding;
  • acreage under sod, pasture or perennial forage, unless it is destroyed by June 10;
  • acreage not seeded in the previous year due to excess moisture that could have been prepared for seeding, but was not; and
  • acreage declared by MASC as being uninsurable.

Costs & Coverage

All Manitoba producers participating in AgriInsurance pay $0.52 per acre for basic Excess Moisture Insurance (EMI), which is 40% of the total premium cost for basic EMI.

EMI Deductible

The EMI program has a standard deductible of 5% of your total acres available for seeding. Your EMI deductible increases by 5% the year following an EMI claim, and decreases by 5% (to a minimum of 5%) the year following a non-claim year.

Reduced Deductible Option (RDO)

You can buy down your deductible to the minimum 5% by choosing the EMI Reduced Deductible Option (RDO). A minimum deductible conforms with the Canada Production Insurance Regulations (Federal) requirement that all insurance programs have a deductible.

Higher Dollar Value Options (HDVOs)

The Higher Dollar Value Options (HDVOs) let you buy up your coverage from the basic $50 per acre to $75 or $100 per acre.

Producers pay 40% of the premiums for the $50 per acre basic coverage and the first $25 per acre of the HDVO (the $75 peracre option). For the second $25 per acre of the HDVO (the $100 per acre option), producers pay 67% of the premium for the extra $25 per acre coverage, in addition to 40% of the first $75 per acre of coverage. The remainder of the premium for basic coverage and HDVO are paid by the federal and provincial governments. Producers pay 100% of the RDO premium.

EMI Coverage Options

EMI coverage options can be combined in the follow ways:

  1. Basic EMI Coverage - no selection required; applies to all AgriInsurance contracts
  2. Basic EMI coverage with Reduced Deductible Option
  3. Basic EMI coverage with one of the $75 per acre OR the $100 per acre Higher Dollar Value Options
  4. Basic EMI coverage with Reduced Deductible Option and one of the $75 per acre OR the $100 per acre Higher Dollar Value Options

Total producer premium costs per acre are as follows:

Comparison of EMI Coverage & Producer Share of Premium Costs (per acre)

Producer Deductible $50 Basic Coverage $75 HDVO $100 HDVO $50 Reduced Deductible Option $75 HDVO & Reduced Deductible $100 HDVO & Reduced Deductible
5% Deductible $0.52 $0.89 $1.72 n/a n/a n/a
10% Deductible $0.52 $1.12 $2.40 $1.51 $2.60 $4.37
15% Deductible $0.52 $1.49 $3.47 $3.10 $5.36 $8.63
20% Deductible $0.52 $2.09 $5.14 $5.29 $9.25 $14.69
25% Deductible $0.52 $3.05 $7.73 $8.10 $14.42 $22.89
30% Deductible $0.52 $4.58 $11.72 $11.51 $21.06 $33.69
35% Deductible $0.52 $7.00 $17.85 $15.52 $29.50 $47.85
40% and above $0.52 n/a n/a n/a n/a n/a
MASC does NOT pay an EMI indemnity if less than 10 acres of a farm (or by unit if a landlord contract applies) cannot be seeded due to excessive moisture.

Example EMI Deductible Calculations

Example 1: Decreasing Base Deductible

If your base deductible is 15% as a result of previous years' claims, it would only increase if your 2017 EMI claim acres exceeded 15% of your eligible acres, even if you have selected the EMI Reduced Deductible Option.

Scenario: You have 1000 eligible acres, but 100 acres are too wet to seed.

Deductible:
With a 15% base deductible and the RDO selected (5%), your deductible acres = 1000 x 5% = 50 deductible acres
Claim acres:
100 acres too wet to seed - 50 acre deductible = 50 acre claim

In this example, your base deductible of 15% of 1000 acres is 150 acres (brought down to 50 acres by the RDO selection). Since your acres too wet to seed in 2017 (100 acres) are less than 150 acres, this is not considered a loss year and your base deductible will decrease to 10% in 2018.

Example 2: Increasing Base Deductible

If your base deductible is 15% as a result of previous years' claims, the base deductible will increase if your 2017 EMI claim acres exceed your base deductible acres, even if you have selected the EMI Reduced Deductible Option.

Scenario: You have 1000 eligible acres, but 250 acres are too wet to seed.

Deductible:
With a 15% base deductible and the RDO selected (5%), your deductible acres = 1000 x 5% = 50 deductible acres
Claim acres:
250 acres too wet to seed - 50 acre deductible = 200 acre claim

In this example, your base deductible is 150 acres (15% of 1000 acres, brought down to 50 acres by the RDO selection). Since your acres too wet to seed in 2017 (250 acres) exceed your base deductible (150 acres), your base deductible will increase to 20% in 2018.

Landlord Obligations

As an eligible landlord, you have the same deductible as your tenant. For example, if the tenant selects the EMI Reduced Deductible Option, it automatically applies to you as landlord, and you must then pay your share of the premium costs.

Scenario: As landlord, you rent 1000 acres on a crop-share basis to your tenant neighbour. The contract states that you (the landlord) and your neighbour (the tenant) share all costs and revenues on a basis of 1/3 by the landlord and 2/3 by the tenant. In 2016, your tenant did not file an EMI claim on the insured acres. In 2017, the tenant has EMI with a 5% base deductible. The total cost of EMI Insurance $0.52 x 1000 = $520.00.

  Premium Indemnity
Tenant = $520.00 x 66.7%
= $346.84
2/3rds of any eligible indemnity
Landlord = $520.00 x 33.3%
= $173.16
1/3rd of any eligible indemnity

Important Dates

Though a basic component of AgriInsurance, Excess Moisture Insurance has several important program-specific deadlines:

November 30 (prior to crop year) is the last day to apply for or make changes to the EMI Reduced Deductible Option and the EMI Higher Dollar Value Option.
March 31 is the last day to add new land to your AgriInsurance contract to be eligible for EMI.
June 10: For any acreage under sod, pasture or perennial forage to qualify for EMI, the acreage must be destroyed by June 10 and be ready for spring seeding.
June 20: Insured producers unable to seed their crop by June 20 due to excessively wet conditions are eligible for an EMI indemnity.
June 22 is the last day to submit your Seeded Acreage Report (SAR) to file an EMI claim without late fees.
June 23 - June 30 is the last period in which you can submit a late EMI claim. MASC will still accept SARs filed during this period; however, the EMI claim is considered late and producers are charged a late filing fee. The late fees are 25% of the EMI indemnity, to a maximum of $1,000.00. Late claim indemnities are only paid if MASC can establish that the land could not be seeded by June 20 due to excessively wet conditions.
June 30: EMI claims will not be accepted after June 30.

Related:

Making a Claim

MASC uses your Seeded Acreage Report (SAR) to calculate EMI claims, and if your acreage unseeded due to excess moisture exceeds your deductible acreage, you'll be paid an indemnity on the difference (multiplied by your selected dollar value).

Claim Example

You have a 5% EMI deductible and have selected basic $50 per acre EMI coverage. You report on your Seeded Acreage Report (SAR) that you seeded 300 acres to canola and summerfallowed 100 acres, but you were unable to seed 50 acres because of excessive moisture.

Eligible Acres = 100 + 300 + 50 = 450 acres
EMI Deductible = 450 x 5% = 23 acres (rounded)
Unseeded Acres = 50 acres
Your Indemnity = (50 - 23) x $50 = $1,350

In this example, you receive an indemnity on the 50 acres you were unable to seed because of excessively wet conditions. You must, however, pay an EMI premium on all of the 450 eligible acres.

In all cases, the minimum amount of a claim is 10 acres (whether or not you have selected the EMI Reduced Deductible Option).

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