Final Agency Determination: FAD-82
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FAD-82
Subject: Request dated September 6, 2007, requesting a Final Agency Determination for the 2006 and
succeeding crop years regarding the interpretation of section 11(b) of the Apple Crop Insurance Provisions, published
at 7 C.F.R. 457.158. This request is pursuant to 7 C.F.R. part 400, subpart X.
Background
Section 11(b) of the Apple Crop Insurance Provisions states, as here pertinent:
11. Duties in the Event of Damage or Loss.
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(b) You must notify us at least 15 days before any production from any unit will be sold by direct marketing.
We will conduct an appraisal that will be used to determine your production to count for production that is sold by
direct marketing. If damage occurs after this appraisal, we will conduct an additional appraisal. These appraisals,
and any acceptable records provided by you, will be used to determine your production to count…
Interpretation Submitted
The requestor interprets section 11(b) of the Apple Crop Insurance Provisions to mean that the Approved Insurance
Provider (AIP) will use an appraisal to establish production to count unless additional damage occurs after the initial
appraisal has been completed. In the event of further damage, the AIP will conduct an additional appraisal and use that
appraisal, along with any acceptable records provided by the insured, to determine production to count.
The requestor interprets the phrase “any acceptable records” to include pick records supplied by the insured provided
those records conform to the acceptability requirements established by the Loss Adjustment Handbook, the Apple Loss
Adjustment Standards Handbook, or other procedures issued by RMA.
The requestor further interprets pick records determined to be acceptable (including, but not limited to pick records
or sales records) will be used to establish production to count despite any variance from the appraisal(s) previously
conducted by the AIP.
Final Agency Determination
The Federal Crop Insurance Corporation (FCIC) agrees in part with the requestor’s interpretation. FCIC agrees
that section 11(b) of the Apple Crop Insurance Provisions requires the AIP will do an appraisal to establish production
to count and if there is further damage, the AIP will conduct an additional appraisal and use that appraisal, along with
any acceptable records provided by the insured, to determine production to count. When an insured fails to provide
acceptable production records, the AIP will use the appraisal as production to count to settle the claim.
FCIC also agrees that any acceptable records includes pick records supplied by the insured provided those records
conform to the criteria for acceptable records contained in the policy and procedures. However, if the acceptable
records provided by the insured demonstrate a variance from the appraisal(s), to be able to use such records instead of
the appraisal(s), the AIP must have adequate documentation to support the that the insured’s records meet all standards
for acceptability and are complete, such variance is reasonable, and the records are a true and accurate accounting of
the total production to count and are more accurate than the initial appraisal.
In accordance with 7 C.F.R. 400.765(c), this constitutes the Final Agency Determination and is binding on all
participants in the Federal crop insurance program for the 2006 and succeeding crop years. Any appeal of this decision
must be in accordance with 7 C.F.R. 400.768(g).
Date of Issue: November 21, 2007
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