BULLETIN NO.: MGR-96-059

TO:      All Reinsured Companies
         All Risk Management Field Offices
         
FROM:    Kenneth D. Ackerman
         Deputy Administrator 

SUBJECT: Guidance for Evaluating 1996 Crop Year Canola Prevented Planting 
         Substitute Crop Claims


BACKGROUND:

The Federal Crop Insurance Corporation (FCIC) St. Paul Risk Compliance Office 
(RCO) has documented that many insureds submitted requests to increase 
maximum Canola acreage eligible for prevented planting coverage which were 
for significantly more acres than the insureds actually intended. Such 
requests had to be submitted to insurance providers on or before the sales 
closing date and insurance providers had to approve such requests in writing. 
The St. Paul RCO also identified that many insureds were planting crops with 
later final planting dates on or before the canola final planting date of May 
25, 1996, for North Dakota and May 31, 1996, for 2 counties in Minnesota.  
The crop insurance policy does not provide prevented planting coverage when 
the producer chooses not to plant the intended crop.  FCIC Manager's Bulletin 
MGR-96-023 and MGR-96-026 announced the extension of the canola final 
planting dates for the 1996 crop year in North Dakota and Minnesota.  

FCIC's approved prevented planting policy for the 1996 crop year provides 
that no prevented planting production guarantee will be provided for such 
acreage if the substitute crop is planted on or before the tenth day 
following the final planting date for the insured crop.  A production 
guarantee equal to twenty-five percent of the production guarantee for timely 
planted acres will be provided if the substitute crop is planted after the 
tenth day following the final planting date for the insured crop.  All 
reinsured companies must assure any prevented planting claims are in 
accordance with all canola policy provisions.   

ACTION:

In accordance with policy provisions, an insured who files a substitute crop 
claim (PP-25%) will not be eligible for such prevented planting production 
guarantee if a substitute crop was planted on the acreage on or before the 
tenth day after the applicable canola final planting date.

Some insureds are claiming prevented planting for canola when other crops 
were planted on the farm and those acres could have been timely planted to 
canola.  Reinsured companies must review the planting dates and identify the 
acres of all crops other than canola planted on or before the applicable 
canola final planting date.  If canola could have been planted on those acres, 
deduct the acres planted to other crops from the acres claimed as prevented 
planting canola (PP-25%).

For example, an insured has 200 cropland acres.  The insured planted 150 
acres to wheat prior to the canola final planting date (e.g. May 20) and is 
not claiming prevented planting on this acreage.  The remaining 50 acres were 
planted to wheat more than 10 days after the canola final planting date and 
the insured is claiming prevented planting canola at 25% of the production 
guarantee, with wheat as the substitute crop.  Since the 50 acres could have 
been planted to canola when the 150 acres of wheat were planted, the insured 
would not be entitled to the 25 percent guarantee.  The planted wheat acres 
would be deducted from the 50 acres claimed as prevented planting resulting 
in no prevented planting payments.

For unplanted prevented planting acre claims (PP-50%), use the criteria 
contained in the canola policy.