Catastrophic Risk Protection Endorsement, 52832-52836 [2013-20800]

Download as PDF 52832 Federal Register / Vol. 78, No. 166 / Tuesday, August 27, 2013 / Rules and Regulations Dated: August 19, 2013. Audrey Rowe, Administrator, Food and Nutrition Service. E-Government Act Compliance FCIC is committed to complying with the E-Government Act of 2002, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes. [FR Doc. 2013–20844 Filed 8–26–13; 8:45 am] BILLING CODE 3410–30–P DEPARTMENT OF AGRICULTURE Federal Crop Insurance Corporation 7 CFR Part 402 [Docket No. FCIC–11–0003] RIN 0563–AC31 Catastrophic Risk Protection Endorsement Federal Crop Insurance Corporation, USDA. ACTION: Final rule. AGENCY: The Federal Crop Insurance Corporation (FCIC) finalizes the Catastrophic Risk Protection Endorsement. The intended effect of this action is to clarify existing policy provisions and to incorporate changes that are consistent with those made in the Common Crop Insurance Policy Basic Provisions and to incorporate provisions regarding catastrophic risk protection coverage for area yield plans from the Area Risk Protection Insurance (ARPI) Basic Provisions. The changes will be effective for the 2014 and succeeding crop years for all crops with a contract change date on or after the effective date of this rule, and for the 2015 and succeeding crop years for all crops with a contract change date prior to the effective date of this rule. DATES: This rule is effective September 26, 2013. FOR FURTHER INFORMATION CONTACT: Tim Hoffmann, Director, Product Administration and Standards Division, Risk Management Agency, United States Department of Agriculture, Beacon Facility, Stop 0812, Room 421, P.O. Box 419205, Kansas City, MO 64141–6205, telephone (816) 926–7730. SUPPLEMENTARY INFORMATION: SUMMARY: Executive Order 12866 pmangrum on DSK3VPTVN1PROD with RULES The Office of Management and Budget (OMB) has determined that this rule is not-significant for the purposes of Executive Order 12866 and, therefore, it has not been reviewed by OMB. Paperwork Reduction Act of 1995 Pursuant to the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), the collections of information in this rule have been approved by OMB under control number 0563–0053. VerDate Mar<15>2010 13:33 Aug 26, 2013 Jkt 229001 Unfunded Mandates Reform Act of 1995 Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. 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. Therefore, this rule is not subject to the requirements of sections 202 and 205 of UMRA. Executive Order 13132 It has been determined under section 1(a) of Executive Order 13132, Federalism, that this rule does not have sufficient implications to warrant consultation with the States. The provisions contained in this rule will not have a substantial direct effect on States, or on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Executive Order 13175 This rule has been reviewed in accordance with the requirements of Executive Order 13175, Consultation and Coordination with Indian Tribal Governments. The review reveals that this regulation will not have substantial and direct effects on Tribal governments and will not have significant Tribal implications. Regulatory Flexibility Act FCIC certifies that this regulation will not have a significant economic impact on a substantial number of small entities. Program requirements for the Federal crop insurance program are the same for all producers regardless of the size of their farming operation. For instance, all producers are required to submit an application and acreage report to establish their insurance guarantees and compute premium amounts, and all producers are required to submit a notice of loss and production information to determine the amount of an indemnity payment in the event of an insured cause of crop loss. Whether a producer has 10 acres or PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 1000 acres, there is no difference in the kind of information collected. To ensure crop insurance is available to small entities, the Federal Crop Insurance Act authorizes FCIC to waive collection of administrative fees from limited resource farmers. FCIC believes this waiver helps to ensure that small entities are given the same opportunities as large entities to manage their risks through the use of crop insurance. A Regulatory Flexibility Analysis has not been prepared since this regulation does not have an impact on small entities, and, therefore, this regulation is exempt from the provisions of the Regulatory Flexibility Act (5 U.S.C. 605). 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 12988 This final rule has been reviewed in accordance with Executive Order 12988 on civil justice reform. The provisions of this rule will not have a retroactive effect. The provisions of this rule will preempt State and local laws to the extent such State and local laws are inconsistent herewith. With respect to any direct action taken by FCIC or to require the insurance provider to take specific action under the terms of the crop insurance policy, the administrative appeal provisions published at 7 CFR part 11 must be exhausted before any action against FCIC for judicial review may be brought. Environmental Evaluation This action is not expected to have a significant economic impact on the quality of the human environment, health, or safety. Therefore, neither an Environmental Assessment nor an Environmental Impact Statement is needed. Background This rule finalizes changes to the Catastrophic Risk Protection Endorsement that were published by FCIC on August 17, 2011, as a notice of proposed rulemaking in the Federal Register at 76 FR 50929–50931. The public was afforded 60 days to submit written comments after the regulation was published in the Federal Register. E:\FR\FM\27AUR1.SGM 27AUR1 Federal Register / Vol. 78, No. 166 / Tuesday, August 27, 2013 / Rules and Regulations pmangrum on DSK3VPTVN1PROD with RULES Finalization of this rule was deferred to assure it was in conformance to changes that were also being made in proposed and final rule as noted below. A total of 35 comments were received from five commenters. The commenters were insurance providers, an insurance service organization, a University, and an interested party. The public comments received regarding the proposed rule and FCIC’s responses to the comments are as follows: General Comment: A commenter stated there should be zero catastrophic risk which is assumed by the American taxpayer. The commenter stated the American taxpayers are already saddled with the bank risks; they do not need to take on any risk for this industry. This industry consistently shifts all its costs onto American taxpayers and it is clear this needs to be stopped. Industry costs should be paid for by those in the industry. The commenter also questioned why the American public is not allowed to comment on these policies which seem to pass the risk on to them. Response: It is unclear what the commenter is referring to. FCIC assumes that this commenter is referring to the fact that the government subsidizes 100 percent of the premium for catastrophic risk protection policies. FCIC does not have the authority to eliminate premium subsidy for catastrophic risk protection coverage. Such subsidy is mandated by section 508(e) of the Federal Crop Insurance Act and cannot be eliminated without a change in the law. FCIC does not agree the public is not allowed to comment on policies. The Administrative Procedure Act requires that FCIC publish a notice of proposed rulemaking to give the public notice and an opportunity to comment on the proposed rule during a specified time period before FCIC promulgates new regulations. The public was allowed to comment when the catastrophic risk protection coverage was first proposed in 1995 and public notice and comment procedures have been completed in this rulemaking. Comment: A commenter stated FCIC has recently published a proposed rule in which Group Risk Protection (GRP), Group Risk Income Protection (GRIP), and Group Risk Income Protection with Harvest Price Option (GRIP–HPO) plans of insurance are proposed to be replaced with new plans called Area Yield Protection (AYP), Area Revenue Protection with the Harvest Price Exclusion (ARP–HPE), and Area Revenue Protection (ARP), respectively. The commenter understands the VerDate Mar<15>2010 13:33 Aug 26, 2013 Jkt 229001 verbiage ‘‘or successor plans of insurance’’ has been added throughout the proposed rule but if the new area plans are published as a final rule prior to the final rule for the Catastrophic Risk Protection Endorsement, the commenter recommended FCIC change the terminology of all references to ‘‘GRP, GRIP, and GRIP–HPO’’ with ‘‘AYP, ARP, and ARP–HPE,’’ respectively, in any provisions of this Endorsement where these plans of insurance are referenced. Response: FCIC elected to publish the Catastrophic Risk Protection Endorsement Final Rule after publishing the final rule to combine the GRIP and GRP plans of insurance. Therefore, the provisions have been updated to incorporate provisions regarding catastrophic risk protection coverage for area yield plans from the Area Risk Protection Insurance (ARPI) Basic Provisions. Order of Priority Comment: A commenter stated revising the paragraph immediately preceding section 1, which refers to the order of priority in the event of a conflict, to include the ‘‘actuarial documents’’ and the ‘‘Commodity Exchange Price Provisions,’’ if applicable, and removing ‘‘Special Provisions’’ from the order of priority weakens the policyholder’s position in the event of a dispute. This change could also lessen the policyholder’s chances of recouping losses at a premium rate. The ‘‘Special Provisions’’ priority order is important because it would allow the policyholder the benefit of Specific Provisions provided in the insurance plan for each insured crop that may vary by geographic area which is outlined in the ‘‘Special Provisions.’’ On the other hand ‘‘actuarial documents’’ do not provide the information necessary to determine the premium rate and in some counties there are no actuarial documents available. The policyholder could potentially receive less than the premium price since the price would be determined by FCIC who would use ‘‘price election’’ to determine the loss. Response: The Special Provisions were not removed from the order of priority. The ‘‘actuarial documents’’ were added to the order of priority following the Special Provisions. The actuarial documents are a part of the policy. FCIC has revised the Agreement to Insure by replacing the phrase ‘‘policy provisions’’ with the word ‘‘policy’’ because the actuarial documents are a part of the policy. The policy priority has been revised to now state ‘‘(2) Special Provisions’’ and ‘‘(3) PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 52833 actuarial documents’’ and is renumbered accordingly. Comment: A few commenters recommended not capitalizing ‘‘Actuarial Documents’’ in the paragraph immediately preceding section 1 which refers to the order of priority in the event of a conflict since it is not capitalized in other references throughout the Endorsement, such as in sections 6(b) and 6(b)(1). Response: FCIC agrees ‘‘actuarial documents’’ should not be capitalized and has modified the phrase accordingly. Section 1—Definitions Comment: A few commenters stated in section 1 most of the current definitions are being deleted because they are either duplicates of the definitions in the Common Crop Insurance Policy Basic Provisions or identified as no longer applicable or needed. The only definitions that remain are ‘‘approved insurance provider,’’ ‘‘FCIC,’’ and ‘‘zero acreage report.’’ Although ‘‘FCIC’’ is not defined in section 1 of the Common Crop Insurance Policy Basic Provisions, it is spelled out in the opening paragraph of the Common Crop Insurance Policy Basic Provisions. The commenters questioned whether a definition is really needed in the Catastrophic Risk Protection Endorsement just to specify that FCIC is ‘‘. . .a wholly owned Government Corporation within USDA.’’ Response: FCIC agrees the definition of ‘‘FCIC’’ is not needed as it is spelled out in the opening paragraph of both the Common Crop Insurance Policy Basic Provisions and the Area Risk Protection Insurance Basic Provisions and has deleted the definition accordingly. Section 3—Unit Division Comment: A few commenters suggested splitting section 3(a) into two sentences or into separate subsections and reversing the order so the rest of this section is combined with the ‘‘in lieu of’’ statement (and not needed for the non-Group Risk policies that do not have basic units by share arrangement). The commenters recommended revising the language to read something like: ‘‘(a) This section is not applicable if you are insured under the Group Risk Plan. . .’’ ‘‘(b) This section is in lieu of the unit provisions specified in the applicable crop policy. For catastrophic risk protection coverage, a unit will be . . .’’ Response: FCIC agrees with the commenters and has revised the provisions in section 3 accordingly. E:\FR\FM\27AUR1.SGM 27AUR1 52834 Federal Register / Vol. 78, No. 166 / Tuesday, August 27, 2013 / Rules and Regulations Section 4—Insurance Guarantees, Coverage Levels, and Prices for Determining Indemnities Comment: A commenter stated amending section 4(b) by removing the phrase ‘‘expected market price’’ and adding the phrase ‘‘price election’’ creates uniformity since the phrase has already been replaced in the Common Crop Insurance Policy Basic Provisions released April 2010. However, the phrase ‘‘expected market price’’ by definition allows the FCIC the ability to establish or approve the price level of each agricultural commodity for which insurance is offered. The phrase ‘‘price election’’ by definition is the value per pound, bushel, ton, carton, or other applicable unit of measure for the purposes of determining premium and indemnity under the policy. The commenter suggested amending the definition of ‘‘price election’’ to include a subpart of the definition from the ‘‘expected market price’’ allowing FCIC the ability to establish or approve the price level of each agricultural commodity for which insurance is offered. Response: FCIC agrees to replace the term ‘‘expected market price’’ with ‘‘price election.’’ However, it is not necessary to revise the definition of ‘‘price election’’ to allow FCIC the ability to establish or approve the price level of each agricultural commodity for which insurance is offered because, as specified in the Common Crop Insurance Policy Basic Provisions, price elections are already announced by FCIC for each insured crop or type. The price elections represent 100 percent of the expected market price. Price elections are determined by FCIC based on the best available data to estimate the expected market price and are issued by the contract change date for each insured crop. pmangrum on DSK3VPTVN1PROD with RULES Section 5—Report of Acreage Comment: A few commenters stated section 5(a) was not proposed to be revised but it might be worth reviewing if this provision needs to be reconsidered. The commenters questioned whether one person can really sign the acreage report for a catastrophic risk protection policy on behalf of everyone else with an insurable interest in the insured crop without their consent (whether by a power of attorney or otherwise), and those others then be bound by the information in that acreage report, unless they specifically object in writing prior to the acreage reporting date and provide their own acreage reports. The commenters also questioned whether VerDate Mar<15>2010 13:33 Aug 26, 2013 Jkt 229001 this is intended to apply only to cases such as when the insured entity is a partnership, or a tenant insuring the landlord’s share on the tenant’s policy. Perhaps this is meant to be limited to the situations mentioned in section 5(b): Partnership or joint venture; other cases specifically allowed in the Catastrophic Risk Protection Endorsement (but the tenant-landlord scenario is not mentioned in this Endorsement); and acreage/interest reported by a spouse, child or other household member. The commenters did not think it could be meant to apply when other persons with an insurable share in the crop have their own policies for that crop/county, possibly with a different insurance provider, and possibly with an additional coverage level rather than catastrophic risk protection coverage. The commenters also questioned how this fits the other procedures and requirements regarding someone being the ‘‘authorized representative’’ for the insured entity. Response: Since no changes to these provisions were proposed and the proposed change is substantive in nature but the public was not provided an opportunity to comment, no change can be made as a result of this comment. FCIC will take this comment under advisement in any future rulemakings. Section 6—Annual Premium and Administrative Fees Comment: A few commenters stated section 6(c) was not proposed to be revised, but with the proposed deletion of the ‘‘limited resource farmer’’ definition (since it is covered in the 2011 Common Crop Insurance Policy Basic Provisions), the reference here to that definition needs to be revised from ‘‘. . . (see section 1) . . .’’, perhaps to ‘‘. . . in the Basic Provisions . . .’’ The commenters also recommended considering whether the rest of this subsection is needed here since it duplicates the information in section 7(e)(4) of the Basic Provisions, perhaps reference could be made to that provision instead. Response: FCIC agrees section 6(c) should be revised to remove reference to section 1 and to remove provisions already contained in the applicable crop policy. This will prevent any potential conflicts between the Catastrophic Risk Protection Endorsement and the applicable Basic Provisions. FCIC has revised the provisions accordingly. Section 7—Insured Crop Comment: A few commenters recommended adding a semicolon before ‘‘however’’ and a comma after in section 7(a). The commenters also PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 recommended rearranging the phrase ‘‘you may separately insure acreage under catastrophic risk protection coverage that has been designated as ‘high-risk’ land by FCIC, provided’’ as ‘‘you may separately insure acreage designated as ‘high-risk’ land by FCIC under catastrophic risk protection coverage, provided.’’ Response: FCIC agrees with the commenters and has revised the provisions accordingly. In addition, FCIC revised section 7 to clarify the provisions are not applicable to those policies insured under the Area Risk Protection Insurance Basic Provisions. Comment: A few commenters recommended combining sections 7(a) and 7(b) into one paragraph (as in the current Catastrophic Risk Protection Endorsement). Response: FCIC agrees with the commenters and has combined the provisions accordingly. Comment: A few commenters stated FCIC proposed deleting section 7(b) regarding an ‘‘undivided interest’’ policy because this will not be available under the USDA Acreage Crop Reporting Streamlining Initiative (ACRSI). The commenter questioned whether this is definite, and whether ACRSI will be implemented before the Catastrophic Risk Protection Endorsement Final Rule is published. Response: ACRSI is an ongoing initiative within the USDA and, regardless of when it is fully implemented, FCIC will no longer recognize undivided interest as an insurable type of person. The applicable procedures will be revised to conform to the removal of undivided interest in this rule. Section 9—Claim for Indemnity Comment: A few commenters stated the ‘‘Background’’ of the proposed rule states that ‘‘FCIC proposes to revise section 9 to clarify the price references to include projected prices, dollar amounts of insurance, or dollar amounts of protection because the term ‘‘price election’’ is not applicable to all plans of insurance.’’ However, the proposed Catastrophic Risk Protection Endorsement provisions did not provide the actual proposed language so the commenters stated it is difficult to comment other than to agree that any outdated ‘‘price election’’ terminology should be updated. Response: The proposed language to revise section 9 to clarify the price references was in the amendatory language of the proposed rule with request for comments. The amendatory language, which preceded the regulatory text in the proposed rule, stated ‘‘l. E:\FR\FM\27AUR1.SGM 27AUR1 Federal Register / Vol. 78, No. 166 / Tuesday, August 27, 2013 / Rules and Regulations Amend section 9 by adding the phrase ‘, projected prices, dollar amounts of insurance, or dollar amounts of protection’ after the phrase ‘multiple price elections’ in the two instances that it appears.’’ FCIC has removed the phrase ‘‘dollar amounts of protection’’ because this phrase was applicable to the GRP and GRIP plans of insurance. pmangrum on DSK3VPTVN1PROD with RULES Section 10—Concealment or Fraud Comment: A few commenters stated section 10(a) was not proposed to be revised, but recommended the reference to ‘‘insurance provider’’ be revised to ‘‘approved insurance provider’’ to match the term as defined in section 1. Response: FCIC agrees the provisions should consistently use the term defined in section 1. However, FCIC believes the term ‘‘insurance provider’’ should be used instead of ‘‘approved insurance provider’’ to be consistent with other provisions in the policy. Therefore, FCIC has changed the defined term ‘‘approved insurance provider’’ to ‘‘insurance provider’’ and revised the definition to be consistent with the definition contained in the Area Risk Protection Insurance Final Rule. Section 11—Exclusion of Coverage Comment: A few commenters stated section 11(a) was not proposed to be revised in the Rule, but section 11(a) states ‘‘Options or endorsements that extend the coverage available under any crop policy offered by FCIC will not be available under this endorsement . . .’’ However, a few exceptions have been made to this statement in the Crop Insurance Handbook (for example, Frost Protection Option, Silage Sorghum Endorsement and Yield Adjustment Election). This would seem to contradict the ‘‘order of priority’’ statement at the beginning of this Endorsement that says the Catastrophic Risk Protection Endorsement takes priority over anything else in the case of a conflict. Response: FCIC has made exceptions to allow catastrophic coverage on a few endorsements or options. These endorsements or options are not endorsements or options that add coverage to an underlying policy but actually are independent coverage that was derived from the existing underlying policy but for the purposes of administration have been referred to as options or endorsements. For example, under the current grain sorghum insurance program, grain sorghum grown for silage purposes is not eligible for insurance. Therefore, the Silage Sorghum Endorsement was created to provide crop insurance coverage for sorghum silage and FCIC VerDate Mar<15>2010 13:33 Aug 26, 2013 Jkt 229001 has allowed catastrophic risk protection level of coverage for the silage sorghum. These exceptions do not include any provision that adds coverage to an existing policy for which additional premium would be charged. Such coverage is not provided under the catastrophic risk protection policy. Therefore, there is no real conflict with section 11(a). List of Subjects in 7 CFR Part 402 Crop insurance, Reporting and recordkeeping requirements. Final Rule Accordingly, as set forth in the preamble, the Federal Crop Insurance Corporation amends 7 CFR part 402 as follows: PART 402—CATASTROPHIC RISK PROTECTION ENDORSEMENT 1. The authority citation for 7 CFR part 402 continues to read as follows: ■ Authority: 7 U.S.C. 1506(l), 1506(o). 2. Amend § 402.4 as follows: a. Revise introductory text preceding section 1; ■ b. Add the definition in section 1 for ‘‘insurance provider’’ in alphabetical order; remove the definitions of ‘‘approved insurance provider,’’ ‘‘approved yield,’’ ‘‘county,’’ ‘‘expected market price,’’ ‘‘FCIC,’’ ‘‘FSA,’’ ‘‘household,’’ ‘‘limited resource farmer,’’ ‘‘Secretary,’’ and ‘‘USDA’’; ■ c. Revise section 2(a); ■ d. Revise sections 3(a) and (b); ■ e. Revise section 4(a); ■ f. Amend section 4(b) by removing the phrase ‘‘expected market price’’ and adding the phrase ‘‘price election’’ in its place; ■ g. Amend section 4(c) by removing the phrase ‘‘Actuarial Table or the’’; ■ h. Remove section 4(d); ■ i. Amend section 6(b) introductory text by removing the phrase ‘‘Special Provisions’’ and adding the phrase ‘‘actuarial documents’’ in its place; ■ j. Revise section 6(c); ■ k. Revise section 7; and ■ l. Amend section 9 by adding the phrase ‘‘, projected prices, or amounts of insurance’’ after the phrase ‘‘price elections’’ in the two instances that it appears. The revised text reads as follows: ■ ■ § 402.4 Catastrophic Risk Protection Endorsement Provisions. * * * * * If a conflict exists among the policy, the order of priority is: (1) This Endorsement; (2) Special Provisions; (3) actuarial documents; (4) the Commodity Exchange Price Provisions, if applicable; PO 00000 Frm 00009 Fmt 4700 Sfmt 4700 52835 and (5) any of the policies specified in section 2, with (1) controlling (2), etc. * * * * * 1. Definitions * * * * * Insurance provider. A private insurance company that has been approved by FCIC to provide insurance coverage to producers participating in programs authorized by the Federal Crop Insurance Act. * * * * * 2. Eligibility, Life of Policy, Cancellation, and Termination (a) You must have one of the following policies in force to elect this Endorsement: (1) The Common Crop Insurance Policy Basic Provisions (7 CFR 457.8) and applicable Crop Provisions (catastrophic risk protection coverage is not available under individual revenue plans of insurance such as Revenue Protection and Revenue Protection with Harvest Price Exclusion); (2) The Area Risk Protection Insurance Basic Provisions (7 CFR 407.9) and applicable Crop Provisions (catastrophic risk protection coverage is not available under area revenue plans of insurance such as Area Revenue Protection or Area Revenue Protection with the Harvest Price Exclusion); or (3) Other crop policies only if catastrophic risk protection coverage is provided in the applicable crop policy. * * * * * 3. Unit Division (a) This section is not applicable if you are insured under the Area Risk Protection Insurance Basic Provisions (7 CFR 407.9) and applicable Crop Provisions. (b) This section is in lieu of the unit provisions specified in the applicable crop policy. For catastrophic risk protection coverage, a unit will be all insurable acreage of the insured crop in the county on the date coverage begins for the crop year: (1) In which you have one hundred percent (100%) crop share; or (2) Which is owned by one person and operated by another person on a share basis. (Example: If, in addition to the land you own, you rent land from five landlords, three on a crop share basis and two on a cash basis, you would be entitled to four units; one for each crop share lease and one that combines the two cash leases and the land you own.) * * * * * E:\FR\FM\27AUR1.SGM 27AUR1 52836 Federal Register / Vol. 78, No. 166 / Tuesday, August 27, 2013 / Rules and Regulations 4. Insurance Guarantees, Coverage Levels, and Prices for Determining Indemnities the catastrophic risk protection coverage policy. * * * * * SW., Renton, Washington. For information on the availability of this material at the FAA, call 425–227–1221. (a) Unless otherwise specified in the Special Provisions, catastrophic risk protection coverage will offer protection equal to: (1) Fifty percent (50%) of your approved yield indemnified at fifty-five percent (55%) of the price election or projected price, as applicable, if you are insured under the Common Crop Insurance Policy Basic Provisions (7 CFR 457.8) and applicable Crop Provisions; (2) Sixty-five percent (65%) of the expected county yield indemnified at forty-five percent (45%) of the maximum protection per acre if you are insured under the Area Risk Protection Insurance Basic Provisions (7 CFR 407.9) and applicable Crop Provisions; or (3) A comparable coverage as established by FCIC for other crop policies only if catastrophic risk protection coverage is provided in the applicable crop policy. * * * * * Signed in Washington, DC, on August 20, 2013. Brandon Willis, Manager, Federal Crop Insurance Corporation. Examining the AD Docket 6. Annual Premium and Administrative Fees * * * * * (c) The administrative fee provisions of paragraph (b) of this section do not apply if you meet the definition of a limited resource farmer specified in the applicable crop policy. The administrative fee will be waived if you request it and you meet the requirements contained in the annual premium provisions of the applicable crop policy. * * * * * pmangrum on DSK3VPTVN1PROD with RULES 7. Insured Crop The crop insured is specified in the applicable crop policy; however, for policies other than those insured under the Area Risk Protection Insurance Basic Provisions, notwithstanding any other policy provision requiring the same insurance coverage on all insurable acreage of the crop in the county, if you purchase additional coverage for a crop, you may separately insure acreage designated as ‘‘high-risk’’ land by FCIC under catastrophic risk protection coverage, provided that you execute a High-Risk Land Exclusion Option and obtain a catastrophic risk protection coverage policy with the same insurance provider on or before the applicable sales closing date. You will be required to pay a separate administrative fee for both the additional coverage policy and VerDate Mar<15>2010 13:33 Aug 26, 2013 Jkt 229001 [Docket No. FAA–2008–0615; Directorate Identifier 2007–NM–352–AD; Amendment 39–17529; AD 2013–15–13] You may examine the AD docket on the Internet at http:// www.regulations.gov; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The address for the Docket Office (phone: 800–647–5527) is Document Management Facility, U.S. Department of Transportation, Docket Operations, M–30, West Building Ground Floor, Room W12–140, 1200 New Jersey Avenue SE., Washington, DC 20590. RIN 2120–AA64 FOR FURTHER INFORMATION CONTACT: [FR Doc. 2013–20800 Filed 8–26–13; 8:45 am] BILLING CODE 3410–08–P DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 Airworthiness Directives; The Boeing Company Airplanes Federal Aviation Administration (FAA), DOT. ACTION: Final rule. AGENCY: We are adopting a new airworthiness directive (AD) for all The Boeing Company Model 757 airplanes. This AD was prompted by two inservice occurrences on Model 737–400 airplanes of total loss of boost pump pressure of the fuel feed system, followed by loss of fuel system suction feed capability on one engine, and inflight shutdown of the engine. This AD requires repetitive operational tests of the engine fuel suction feed of the fuel system, and corrective actions if necessary. We are issuing this AD to detect and correct loss of the engine fuel suction feed capability of the fuel system, which, in the event of total loss of the fuel boost pumps, could result in dual engine flameout, inability to restart the engines, and consequent forced landing of the airplane. DATES: This AD is effective October 1, 2013. The Director of the Federal Register approved the incorporation by reference of a certain publication listed in the AD as of October 1, 2013. ADDRESSES: For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H–65, Seattle, WA 98124–2207; telephone 206–544–5000, extension 1; fax 206–766–5680; Internet https:// www.myboeingfleet.com. You may review copies of the referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SUMMARY: PO 00000 Frm 00010 Fmt 4700 Sfmt 4700 Sue Lucier, Aerospace Engineer, Propulsion Branch, ANM–140S, Seattle Aircraft Certification Office, FAA, 1601 Lind Avenue SW., Renton, Washington 98057–3356; phone: 425–917–6438; fax: 425–917–6590; email: suzanne.lucier@ faa.gov. SUPPLEMENTARY INFORMATION: Discussion We issued a supplemental notice of proposed rulemaking (SNPRM) to amend 14 CFR part 39 to include an airworthiness directive (AD) that would apply to the specified products. The SNPRM published in the Federal Register on October 30, 2012 (77 FR 65642). We preceded the SNPRM with a notice of proposed rulemaking (NPRM) that published in the Federal Register on June 6, 2008 (73 FR 32256). The NPRM proposed to require repetitive operational tests of the engine fuel suction feed of the fuel system, and other related testing if necessary, according to a method approved by the FAA. The SNPRM proposed to require repetitive operational tests of the engine fuel suction feed of the fuel system, and corrective actions if necessary. Comments We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the SNPRM (77 FR 65642, October 30, 2012) and the FAA’s response to each comment. Support for the SNPRM (77 FR 65642, October 30, 2012) One commenter, Mara Essick, submitted support for the actions specified in the SNPRM (77 FR 65642, October 30, 2012). E:\FR\FM\27AUR1.SGM 27AUR1

Agencies

[Federal Register Volume 78, Number 166 (Tuesday, August 27, 2013)]
[Rules and Regulations]
[Pages 52832-52836]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-20800]


-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Federal Crop Insurance Corporation

7 CFR Part 402

[Docket No. FCIC-11-0003]
RIN 0563-AC31


Catastrophic Risk Protection Endorsement

AGENCY: Federal Crop Insurance Corporation, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: The Federal Crop Insurance Corporation (FCIC) finalizes the 
Catastrophic Risk Protection Endorsement. The intended effect of this 
action is to clarify existing policy provisions and to incorporate 
changes that are consistent with those made in the Common Crop 
Insurance Policy Basic Provisions and to incorporate provisions 
regarding catastrophic risk protection coverage for area yield plans 
from the Area Risk Protection Insurance (ARPI) Basic Provisions. The 
changes will be effective for the 2014 and succeeding crop years for 
all crops with a contract change date on or after the effective date of 
this rule, and for the 2015 and succeeding crop years for all crops 
with a contract change date prior to the effective date of this rule.

DATES: This rule is effective September 26, 2013.

FOR FURTHER INFORMATION CONTACT: Tim Hoffmann, Director, Product 
Administration and Standards Division, Risk Management Agency, United 
States Department of Agriculture, Beacon Facility, Stop 0812, Room 421, 
P.O. Box 419205, Kansas City, MO 64141-6205, telephone (816) 926-7730.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    The Office of Management and Budget (OMB) has determined that this 
rule is not-significant for the purposes of Executive Order 12866 and, 
therefore, it has not been reviewed by OMB.

Paperwork Reduction Act of 1995

    Pursuant to the provisions of the Paperwork Reduction Act of 1995 
(44 U.S.C. chapter 35), the collections of information in this rule 
have been approved by OMB under control number 0563-0053.

E-Government Act Compliance

    FCIC is committed to complying with the E-Government Act of 2002, 
to promote the use of the Internet and other information technologies 
to provide increased opportunities for citizen access to Government 
information and services, and for other purposes.

Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) 
establishes requirements for Federal agencies to assess the effects of 
their regulatory actions on State, local, and tribal governments and 
the private sector. 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. Therefore, this rule is not 
subject to the requirements of sections 202 and 205 of UMRA.

Executive Order 13132

    It has been determined under section 1(a) of Executive Order 13132, 
Federalism, that this rule does not have sufficient implications to 
warrant consultation with the States. The provisions contained in this 
rule will not have a substantial direct effect on States, or on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.

Executive Order 13175

    This rule has been reviewed in accordance with the requirements of 
Executive Order 13175, Consultation and Coordination with Indian Tribal 
Governments. The review reveals that this regulation will not have 
substantial and direct effects on Tribal governments and will not have 
significant Tribal implications.

Regulatory Flexibility Act

    FCIC certifies that this regulation will not have a significant 
economic impact on a substantial number of small entities. Program 
requirements for the Federal crop insurance program are the same for 
all producers regardless of the size of their farming operation. For 
instance, all producers are required to submit an application and 
acreage report to establish their insurance guarantees and compute 
premium amounts, and all producers are required to submit a notice of 
loss and production information to determine the amount of an indemnity 
payment in the event of an insured cause of crop loss. Whether a 
producer has 10 acres or 1000 acres, there is no difference in the kind 
of information collected. To ensure crop insurance is available to 
small entities, the Federal Crop Insurance Act authorizes FCIC to waive 
collection of administrative fees from limited resource farmers. FCIC 
believes this waiver helps to ensure that small entities are given the 
same opportunities as large entities to manage their risks through the 
use of crop insurance. A Regulatory Flexibility Analysis has not been 
prepared since this regulation does not have an impact on small 
entities, and, therefore, this regulation is exempt from the provisions 
of the Regulatory Flexibility Act (5 U.S.C. 605).

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 12988

    This final rule has been reviewed in accordance with Executive 
Order 12988 on civil justice reform. The provisions of this rule will 
not have a retroactive effect. The provisions of this rule will preempt 
State and local laws to the extent such State and local laws are 
inconsistent herewith. With respect to any direct action taken by FCIC 
or to require the insurance provider to take specific action under the 
terms of the crop insurance policy, the administrative appeal 
provisions published at 7 CFR part 11 must be exhausted before any 
action against FCIC for judicial review may be brought.

Environmental Evaluation

    This action is not expected to have a significant economic impact 
on the quality of the human environment, health, or safety. Therefore, 
neither an Environmental Assessment nor an Environmental Impact 
Statement is needed.

Background

    This rule finalizes changes to the Catastrophic Risk Protection 
Endorsement that were published by FCIC on August 17, 2011, as a notice 
of proposed rulemaking in the Federal Register at 76 FR 50929-50931. 
The public was afforded 60 days to submit written comments after the 
regulation was published in the Federal Register.

[[Page 52833]]

Finalization of this rule was deferred to assure it was in conformance 
to changes that were also being made in proposed and final rule as 
noted below.
    A total of 35 comments were received from five commenters. The 
commenters were insurance providers, an insurance service organization, 
a University, and an interested party. The public comments received 
regarding the proposed rule and FCIC's responses to the comments are as 
follows:

General

    Comment: A commenter stated there should be zero catastrophic risk 
which is assumed by the American taxpayer. The commenter stated the 
American taxpayers are already saddled with the bank risks; they do not 
need to take on any risk for this industry. This industry consistently 
shifts all its costs onto American taxpayers and it is clear this needs 
to be stopped. Industry costs should be paid for by those in the 
industry. The commenter also questioned why the American public is not 
allowed to comment on these policies which seem to pass the risk on to 
them.
    Response: It is unclear what the commenter is referring to. FCIC 
assumes that this commenter is referring to the fact that the 
government subsidizes 100 percent of the premium for catastrophic risk 
protection policies. FCIC does not have the authority to eliminate 
premium subsidy for catastrophic risk protection coverage. Such subsidy 
is mandated by section 508(e) of the Federal Crop Insurance Act and 
cannot be eliminated without a change in the law. FCIC does not agree 
the public is not allowed to comment on policies. The Administrative 
Procedure Act requires that FCIC publish a notice of proposed 
rulemaking to give the public notice and an opportunity to comment on 
the proposed rule during a specified time period before FCIC 
promulgates new regulations. The public was allowed to comment when the 
catastrophic risk protection coverage was first proposed in 1995 and 
public notice and comment procedures have been completed in this 
rulemaking.
    Comment: A commenter stated FCIC has recently published a proposed 
rule in which Group Risk Protection (GRP), Group Risk Income Protection 
(GRIP), and Group Risk Income Protection with Harvest Price Option 
(GRIP-HPO) plans of insurance are proposed to be replaced with new 
plans called Area Yield Protection (AYP), Area Revenue Protection with 
the Harvest Price Exclusion (ARP-HPE), and Area Revenue Protection 
(ARP), respectively. The commenter understands the verbiage ``or 
successor plans of insurance'' has been added throughout the proposed 
rule but if the new area plans are published as a final rule prior to 
the final rule for the Catastrophic Risk Protection Endorsement, the 
commenter recommended FCIC change the terminology of all references to 
``GRP, GRIP, and GRIP-HPO'' with ``AYP, ARP, and ARP-HPE,'' 
respectively, in any provisions of this Endorsement where these plans 
of insurance are referenced.
    Response: FCIC elected to publish the Catastrophic Risk Protection 
Endorsement Final Rule after publishing the final rule to combine the 
GRIP and GRP plans of insurance. Therefore, the provisions have been 
updated to incorporate provisions regarding catastrophic risk 
protection coverage for area yield plans from the Area Risk Protection 
Insurance (ARPI) Basic Provisions.

Order of Priority

    Comment: A commenter stated revising the paragraph immediately 
preceding section 1, which refers to the order of priority in the event 
of a conflict, to include the ``actuarial documents'' and the 
``Commodity Exchange Price Provisions,'' if applicable, and removing 
``Special Provisions'' from the order of priority weakens the 
policyholder's position in the event of a dispute. This change could 
also lessen the policyholder's chances of recouping losses at a premium 
rate. The ``Special Provisions'' priority order is important because it 
would allow the policyholder the benefit of Specific Provisions 
provided in the insurance plan for each insured crop that may vary by 
geographic area which is outlined in the ``Special Provisions.'' On the 
other hand ``actuarial documents'' do not provide the information 
necessary to determine the premium rate and in some counties there are 
no actuarial documents available. The policyholder could potentially 
receive less than the premium price since the price would be determined 
by FCIC who would use ``price election'' to determine the loss.
    Response: The Special Provisions were not removed from the order of 
priority. The ``actuarial documents'' were added to the order of 
priority following the Special Provisions. The actuarial documents are 
a part of the policy. FCIC has revised the Agreement to Insure by 
replacing the phrase ``policy provisions'' with the word ``policy'' 
because the actuarial documents are a part of the policy. The policy 
priority has been revised to now state ``(2) Special Provisions'' and 
``(3) actuarial documents'' and is renumbered accordingly.
    Comment: A few commenters recommended not capitalizing ``Actuarial 
Documents'' in the paragraph immediately preceding section 1 which 
refers to the order of priority in the event of a conflict since it is 
not capitalized in other references throughout the Endorsement, such as 
in sections 6(b) and 6(b)(1).
    Response: FCIC agrees ``actuarial documents'' should not be 
capitalized and has modified the phrase accordingly.

Section 1--Definitions

    Comment: A few commenters stated in section 1 most of the current 
definitions are being deleted because they are either duplicates of the 
definitions in the Common Crop Insurance Policy Basic Provisions or 
identified as no longer applicable or needed. The only definitions that 
remain are ``approved insurance provider,'' ``FCIC,'' and ``zero 
acreage report.'' Although ``FCIC'' is not defined in section 1 of the 
Common Crop Insurance Policy Basic Provisions, it is spelled out in the 
opening paragraph of the Common Crop Insurance Policy Basic Provisions. 
The commenters questioned whether a definition is really needed in the 
Catastrophic Risk Protection Endorsement just to specify that FCIC is 
``. . .a wholly owned Government Corporation within USDA.''
    Response: FCIC agrees the definition of ``FCIC'' is not needed as 
it is spelled out in the opening paragraph of both the Common Crop 
Insurance Policy Basic Provisions and the Area Risk Protection 
Insurance Basic Provisions and has deleted the definition accordingly.

Section 3--Unit Division

    Comment: A few commenters suggested splitting section 3(a) into two 
sentences or into separate subsections and reversing the order so the 
rest of this section is combined with the ``in lieu of'' statement (and 
not needed for the non-Group Risk policies that do not have basic units 
by share arrangement). The commenters recommended revising the language 
to read something like:
    ``(a) This section is not applicable if you are insured under the 
Group Risk Plan. . .''
    ``(b) This section is in lieu of the unit provisions specified in 
the applicable crop policy. For catastrophic risk protection coverage, 
a unit will be . . .''
    Response: FCIC agrees with the commenters and has revised the 
provisions in section 3 accordingly.

[[Page 52834]]

Section 4--Insurance Guarantees, Coverage Levels, and Prices for 
Determining Indemnities

    Comment: A commenter stated amending section 4(b) by removing the 
phrase ``expected market price'' and adding the phrase ``price 
election'' creates uniformity since the phrase has already been 
replaced in the Common Crop Insurance Policy Basic Provisions released 
April 2010. However, the phrase ``expected market price'' by definition 
allows the FCIC the ability to establish or approve the price level of 
each agricultural commodity for which insurance is offered. The phrase 
``price election'' by definition is the value per pound, bushel, ton, 
carton, or other applicable unit of measure for the purposes of 
determining premium and indemnity under the policy. The commenter 
suggested amending the definition of ``price election'' to include a 
subpart of the definition from the ``expected market price'' allowing 
FCIC the ability to establish or approve the price level of each 
agricultural commodity for which insurance is offered.
    Response: FCIC agrees to replace the term ``expected market price'' 
with ``price election.'' However, it is not necessary to revise the 
definition of ``price election'' to allow FCIC the ability to establish 
or approve the price level of each agricultural commodity for which 
insurance is offered because, as specified in the Common Crop Insurance 
Policy Basic Provisions, price elections are already announced by FCIC 
for each insured crop or type. The price elections represent 100 
percent of the expected market price. Price elections are determined by 
FCIC based on the best available data to estimate the expected market 
price and are issued by the contract change date for each insured crop.

Section 5--Report of Acreage

    Comment: A few commenters stated section 5(a) was not proposed to 
be revised but it might be worth reviewing if this provision needs to 
be reconsidered. The commenters questioned whether one person can 
really sign the acreage report for a catastrophic risk protection 
policy on behalf of everyone else with an insurable interest in the 
insured crop without their consent (whether by a power of attorney or 
otherwise), and those others then be bound by the information in that 
acreage report, unless they specifically object in writing prior to the 
acreage reporting date and provide their own acreage reports. The 
commenters also questioned whether this is intended to apply only to 
cases such as when the insured entity is a partnership, or a tenant 
insuring the landlord's share on the tenant's policy. Perhaps this is 
meant to be limited to the situations mentioned in section 5(b): 
Partnership or joint venture; other cases specifically allowed in the 
Catastrophic Risk Protection Endorsement (but the tenant-landlord 
scenario is not mentioned in this Endorsement); and acreage/interest 
reported by a spouse, child or other household member. The commenters 
did not think it could be meant to apply when other persons with an 
insurable share in the crop have their own policies for that crop/
county, possibly with a different insurance provider, and possibly with 
an additional coverage level rather than catastrophic risk protection 
coverage. The commenters also questioned how this fits the other 
procedures and requirements regarding someone being the ``authorized 
representative'' for the insured entity.
    Response: Since no changes to these provisions were proposed and 
the proposed change is substantive in nature but the public was not 
provided an opportunity to comment, no change can be made as a result 
of this comment. FCIC will take this comment under advisement in any 
future rulemakings.

Section 6--Annual Premium and Administrative Fees

    Comment: A few commenters stated section 6(c) was not proposed to 
be revised, but with the proposed deletion of the ``limited resource 
farmer'' definition (since it is covered in the 2011 Common Crop 
Insurance Policy Basic Provisions), the reference here to that 
definition needs to be revised from ``. . . (see section 1) . . .'', 
perhaps to ``. . . in the Basic Provisions . . .'' The commenters also 
recommended considering whether the rest of this subsection is needed 
here since it duplicates the information in section 7(e)(4) of the 
Basic Provisions, perhaps reference could be made to that provision 
instead.
    Response: FCIC agrees section 6(c) should be revised to remove 
reference to section 1 and to remove provisions already contained in 
the applicable crop policy. This will prevent any potential conflicts 
between the Catastrophic Risk Protection Endorsement and the applicable 
Basic Provisions. FCIC has revised the provisions accordingly.

Section 7--Insured Crop

    Comment: A few commenters recommended adding a semicolon before 
``however'' and a comma after in section 7(a). The commenters also 
recommended rearranging the phrase ``you may separately insure acreage 
under catastrophic risk protection coverage that has been designated as 
`high-risk' land by FCIC, provided'' as ``you may separately insure 
acreage designated as `high-risk' land by FCIC under catastrophic risk 
protection coverage, provided.''
    Response: FCIC agrees with the commenters and has revised the 
provisions accordingly. In addition, FCIC revised section 7 to clarify 
the provisions are not applicable to those policies insured under the 
Area Risk Protection Insurance Basic Provisions.
    Comment: A few commenters recommended combining sections 7(a) and 
7(b) into one paragraph (as in the current Catastrophic Risk Protection 
Endorsement).
    Response: FCIC agrees with the commenters and has combined the 
provisions accordingly.
    Comment: A few commenters stated FCIC proposed deleting section 
7(b) regarding an ``undivided interest'' policy because this will not 
be available under the USDA Acreage Crop Reporting Streamlining 
Initiative (ACRSI). The commenter questioned whether this is definite, 
and whether ACRSI will be implemented before the Catastrophic Risk 
Protection Endorsement Final Rule is published.
    Response: ACRSI is an ongoing initiative within the USDA and, 
regardless of when it is fully implemented, FCIC will no longer 
recognize undivided interest as an insurable type of person. The 
applicable procedures will be revised to conform to the removal of 
undivided interest in this rule.

Section 9--Claim for Indemnity

    Comment: A few commenters stated the ``Background'' of the proposed 
rule states that ``FCIC proposes to revise section 9 to clarify the 
price references to include projected prices, dollar amounts of 
insurance, or dollar amounts of protection because the term ``price 
election'' is not applicable to all plans of insurance.'' However, the 
proposed Catastrophic Risk Protection Endorsement provisions did not 
provide the actual proposed language so the commenters stated it is 
difficult to comment other than to agree that any outdated ``price 
election'' terminology should be updated.
    Response: The proposed language to revise section 9 to clarify the 
price references was in the amendatory language of the proposed rule 
with request for comments. The amendatory language, which preceded the 
regulatory text in the proposed rule, stated ``l.

[[Page 52835]]

Amend section 9 by adding the phrase `, projected prices, dollar 
amounts of insurance, or dollar amounts of protection' after the phrase 
`multiple price elections' in the two instances that it appears.'' FCIC 
has removed the phrase ``dollar amounts of protection'' because this 
phrase was applicable to the GRP and GRIP plans of insurance.

Section 10--Concealment or Fraud

    Comment: A few commenters stated section 10(a) was not proposed to 
be revised, but recommended the reference to ``insurance provider'' be 
revised to ``approved insurance provider'' to match the term as defined 
in section 1.
    Response: FCIC agrees the provisions should consistently use the 
term defined in section 1. However, FCIC believes the term ``insurance 
provider'' should be used instead of ``approved insurance provider'' to 
be consistent with other provisions in the policy. Therefore, FCIC has 
changed the defined term ``approved insurance provider'' to ``insurance 
provider'' and revised the definition to be consistent with the 
definition contained in the Area Risk Protection Insurance Final Rule.

Section 11--Exclusion of Coverage

    Comment: A few commenters stated section 11(a) was not proposed to 
be revised in the Rule, but section 11(a) states ``Options or 
endorsements that extend the coverage available under any crop policy 
offered by FCIC will not be available under this endorsement . . .'' 
However, a few exceptions have been made to this statement in the Crop 
Insurance Handbook (for example, Frost Protection Option, Silage 
Sorghum Endorsement and Yield Adjustment Election). This would seem to 
contradict the ``order of priority'' statement at the beginning of this 
Endorsement that says the Catastrophic Risk Protection Endorsement 
takes priority over anything else in the case of a conflict.
    Response: FCIC has made exceptions to allow catastrophic coverage 
on a few endorsements or options. These endorsements or options are not 
endorsements or options that add coverage to an underlying policy but 
actually are independent coverage that was derived from the existing 
underlying policy but for the purposes of administration have been 
referred to as options or endorsements. For example, under the current 
grain sorghum insurance program, grain sorghum grown for silage 
purposes is not eligible for insurance. Therefore, the Silage Sorghum 
Endorsement was created to provide crop insurance coverage for sorghum 
silage and FCIC has allowed catastrophic risk protection level of 
coverage for the silage sorghum. These exceptions do not include any 
provision that adds coverage to an existing policy for which additional 
premium would be charged. Such coverage is not provided under the 
catastrophic risk protection policy. Therefore, there is no real 
conflict with section 11(a).

List of Subjects in 7 CFR Part 402

    Crop insurance, Reporting and recordkeeping requirements.

Final Rule

    Accordingly, as set forth in the preamble, the Federal Crop 
Insurance Corporation amends 7 CFR part 402 as follows:

PART 402--CATASTROPHIC RISK PROTECTION ENDORSEMENT

0
1. The authority citation for 7 CFR part 402 continues to read as 
follows:

    Authority:  7 U.S.C. 1506(l), 1506(o).


0
2. Amend Sec.  402.4 as follows:
0
a. Revise introductory text preceding section 1;
0
b. Add the definition in section 1 for ``insurance provider'' in 
alphabetical order; remove the definitions of ``approved insurance 
provider,'' ``approved yield,'' ``county,'' ``expected market price,'' 
``FCIC,'' ``FSA,'' ``household,'' ``limited resource farmer,'' 
``Secretary,'' and ``USDA'';
0
c. Revise section 2(a);
0
d. Revise sections 3(a) and (b);
0
e. Revise section 4(a);
0
f. Amend section 4(b) by removing the phrase ``expected market price'' 
and adding the phrase ``price election'' in its place;
0
g. Amend section 4(c) by removing the phrase ``Actuarial Table or 
the'';
0
h. Remove section 4(d);
0
i. Amend section 6(b) introductory text by removing the phrase 
``Special Provisions'' and adding the phrase ``actuarial documents'' in 
its place;
0
j. Revise section 6(c);
0
k. Revise section 7; and
0
l. Amend section 9 by adding the phrase ``, projected prices, or 
amounts of insurance'' after the phrase ``price elections'' in the two 
instances that it appears.
    The revised text reads as follows:


Sec.  402.4  Catastrophic Risk Protection Endorsement Provisions.

* * * * *
    If a conflict exists among the policy, the order of priority is: 
(1) This Endorsement; (2) Special Provisions; (3) actuarial documents; 
(4) the Commodity Exchange Price Provisions, if applicable; and (5) any 
of the policies specified in section 2, with (1) controlling (2), etc.
* * * * *
1. Definitions
* * * * *
    Insurance provider. A private insurance company that has been 
approved by FCIC to provide insurance coverage to producers 
participating in programs authorized by the Federal Crop Insurance Act.
* * * * *
2. Eligibility, Life of Policy, Cancellation, and Termination
    (a) You must have one of the following policies in force to elect 
this Endorsement:
    (1) The Common Crop Insurance Policy Basic Provisions (7 CFR 457.8) 
and applicable Crop Provisions (catastrophic risk protection coverage 
is not available under individual revenue plans of insurance such as 
Revenue Protection and Revenue Protection with Harvest Price 
Exclusion);
    (2) The Area Risk Protection Insurance Basic Provisions (7 CFR 
407.9) and applicable Crop Provisions (catastrophic risk protection 
coverage is not available under area revenue plans of insurance such as 
Area Revenue Protection or Area Revenue Protection with the Harvest 
Price Exclusion); or
    (3) Other crop policies only if catastrophic risk protection 
coverage is provided in the applicable crop policy.
* * * * *
3. Unit Division
    (a) This section is not applicable if you are insured under the 
Area Risk Protection Insurance Basic Provisions (7 CFR 407.9) and 
applicable Crop Provisions.
    (b) This section is in lieu of the unit provisions specified in the 
applicable crop policy. For catastrophic risk protection coverage, a 
unit will be all insurable acreage of the insured crop in the county on 
the date coverage begins for the crop year:
    (1) In which you have one hundred percent (100%) crop share; or
    (2) Which is owned by one person and operated by another person on 
a share basis.
    (Example: If, in addition to the land you own, you rent land from 
five landlords, three on a crop share basis and two on a cash basis, 
you would be entitled to four units; one for each crop share lease and 
one that combines the two cash leases and the land you own.)
* * * * *

[[Page 52836]]

4. Insurance Guarantees, Coverage Levels, and Prices for Determining 
Indemnities
    (a) Unless otherwise specified in the Special Provisions, 
catastrophic risk protection coverage will offer protection equal to:
    (1) Fifty percent (50%) of your approved yield indemnified at 
fifty-five percent (55%) of the price election or projected price, as 
applicable, if you are insured under the Common Crop Insurance Policy 
Basic Provisions (7 CFR 457.8) and applicable Crop Provisions;
    (2) Sixty-five percent (65%) of the expected county yield 
indemnified at forty-five percent (45%) of the maximum protection per 
acre if you are insured under the Area Risk Protection Insurance Basic 
Provisions (7 CFR 407.9) and applicable Crop Provisions; or
    (3) A comparable coverage as established by FCIC for other crop 
policies only if catastrophic risk protection coverage is provided in 
the applicable crop policy.
* * * * *
6. Annual Premium and Administrative Fees
* * * * *
    (c) The administrative fee provisions of paragraph (b) of this 
section do not apply if you meet the definition of a limited resource 
farmer specified in the applicable crop policy. The administrative fee 
will be waived if you request it and you meet the requirements 
contained in the annual premium provisions of the applicable crop 
policy.
* * * * *
7. Insured Crop
    The crop insured is specified in the applicable crop policy; 
however, for policies other than those insured under the Area Risk 
Protection Insurance Basic Provisions, notwithstanding any other policy 
provision requiring the same insurance coverage on all insurable 
acreage of the crop in the county, if you purchase additional coverage 
for a crop, you may separately insure acreage designated as ``high-
risk'' land by FCIC under catastrophic risk protection coverage, 
provided that you execute a High-Risk Land Exclusion Option and obtain 
a catastrophic risk protection coverage policy with the same insurance 
provider on or before the applicable sales closing date. You will be 
required to pay a separate administrative fee for both the additional 
coverage policy and the catastrophic risk protection coverage policy.
* * * * *

    Signed in Washington, DC, on August 20, 2013.
Brandon Willis,
Manager, Federal Crop Insurance Corporation.
[FR Doc. 2013-20800 Filed 8-26-13; 8:45 am]
BILLING CODE 3410-08-P