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 https://
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