INFORMATIONAL MEMORANDUM: R&D-97-052
    
TO:      All Reinsured Companies
         All Risk Management Field Offices
              
FROM:    Tim B. Witt    /s/ Tim B. Witt    07/09/97
         Deputy Administrator
     
SUBJECT: Example of the Federal Crop Insurance Reinsurance Model and 
         State Retained Loss Ratios
     
An example that illustrates the calculations of the Federal Crop
Insurance reinsurance model and the final retained loss ratios used to
calculate the average rate of gains under the Standard Reinsurance
Agreement have been placed on the Federal Crop Insurance public access
server of the Internet.  These materials may be found at the following
address:
     
         http://www.act.fcic.usda.gov/actuarial/index.html
     
At this screen, select the "FTP Download" link, which transfers to a
public directory.  The directory SRADATA/ in this public directory
contains the information.
     
The information consists of a Wordperfect document (REINSUR.WPD) that
describes the data and calculations contained in a Lotus spreadsheet
entitled CRDSUMRY.WK4.  The spreadsheet entitled RETAINLR.WK4 contains
the retained loss ratios that conform to those illustrated in Table 5 of
CRDSUMRY.WK4.  The retained loss ratios are given for major crops in
each State and the State average for each year from 1980-1996.  However,
only 1981-1996 are used in the model.
     
Technical questions regarding these data should be directed to Jim
Driscoll at 816-926-7914. Any questions regarding downloading of these
files should be directed to Bob Sifuentes at 816-926-6368.