BULLETIN NO.:  MGR-97-036

TO:        All Reinsured Companies 
           All Risk Management Field Offices
           All Other Interested Parties

FROM:      Kenneth D. Ackerman
           Administrator

SUBJECT:   Final 1998 Standard Reinsurance Agreement
           SRA), Plan of Operations (Plan)and Manual 14


The Risk Management Agency (RMA) has finalized the 1998
SRA from the draft issued August 28, 1997.  RMA wishes to
thank the entire crop insurance industry as well as all
RMA personnel involved in this effort for their
significant support, valuable input, and hard work.

A 'redlined' copy of the SRA, showing changes from the
August 28 draft, is attached for your information.
Although several changes were made, explanations of the
following two items were requested by several persons:

1.  The language contained in Section II.A.2. regarding a
    "separate and complete reinsurance agreement" was
    incorporated so as not to require companies to sell
    insurance plans that are reinsured outside the SRA. 

    For example, under this provision all companies must
    sell revenue insurance plans covered by the SRA but
    do not have to sell add-on coverages that have their
    own reinsurance agreements.

2.  In section V.G.2.a., the word "Employees" was left in
    to assure that any person who performs any act
    normally reserved to sales agents must hold an
    insurance agent's license.  Employees who do not act
    as sales agents do not require licenses.  Thus, in
    the often-cited example of company employees working
    trade shows for purpose of disseminating general
    information, they would not be required to hold an
    insurance agent's license.

    Also attached are the SRA (clean version), Plan, and
    Manual 14 offered by the Federal Crop Insurance
    Corporation (FCIC) for the 1998 reinsurance year,
    which began July 1, 1997.  

Manual 13 will be issued directly from RMA's Kansas City
Office.



BULLETIN NO.: MGR-97-036                                2 

In order to execute the 1998 SRA, two copies of the clean
version must be signed as originals in blue ink by a
duly-authorized person who is empowered to sign on behalf
of the primary insurance company that will be reinsured. 
The two signed SRAs and two completed copies of the Plan
must be submitted by close of business November 3, 1997. 
Please send to the following address:

              USDA/Risk Management Agency
              Reinsurance Services Division
              E. Heyward Baker, Director
              1400 Independence Ave, S.W.
              Rm 6727-S, Stop Code 0530
              Washington, D.C.  20250

Upon receipt of the properly executed documents,
including all documentation requested in the Plan, FCIC
will evaluate them and perform the financial review
required by the Standards for Approval (7 CFR, section
400.170).  RMA will process submissions in the order
received and will make every effort to process each SRA
quickly.

Because FCIC may not make any payment under the 1998 SRA
until it is signed by both parties, we ask everyone's
cooperation in assuring that required documentation is
complete upon submission and that companies not wait
until the deadline to submit their documents.

When the SRA is approved, one complete copy of the
original SRA will be signed by FCIC and returned to the
Company along with a copy of the Plan.

RMA will issue a Manager's Bulletin outlining the process
to revise guidelines governing litigation support to crop
insurance companies.  These revised guidelines will be 
effective for the 1998 reinsurance year which began
July 1, 1997.

Thank you again for your participation in FCIC's
reinsurance program.  If you should have any questions
regarding this matter, please contact your account
executive.

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