Final Agency Determination: FAD-99

FAD-99

Subject: Request dated March 3, 2009, requesting a Final Agency Determination for the 2007 crop year regarding the interpretation of section 20(i) of the Common Crop Insurance Policy Basic Provisions (Basic Provisions), published at 7 C.F.R. 457.8. This request is pursuant to 7 C.F.R. part 400, subpart X.

Section 20(i) of the Basic Provisions states:

20. Mediation, Arbitration, Appeal, Reconsideration, and Administrative and Judicial Review.

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(i) In a judicial review only, you may recover attorneys fees or other expenses, or any punitive, compensatory or any other damages from us only if you obtain a determination from FCIC that we, our agent or loss adjuster failed to comply with the terms of this policy or procedures issued by FCIC and such failure resulted in you receiving a payment in an amount that is less than the amount to which you were entitled. Requests for such a determination should be addressed to the following: USDA/RMA/Deputy Administrator of Compliance/Stop 0806, 1400 Independence Avenue, S.W., Washington, D.C. 20250-0806.

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The requestor interprets these provisions to mean attorneys’ fees may only be recovered in a judicial review and only if a determination is made by the Federal Crop Insurance Corporation (FCIC) that an agent or loss adjuster representing the company failed to comply with the terms of the policy or procedures issued by FCIC.

The Federal Crop Insurance Corporation (FCIC) agrees in part with the requestor’s interpretation. The provisions specify that it is only in a judicial review that producers can recover attorneys fees or other expenses, or any punitive, compensatory or any other damages from insurance providers provided the producer obtains a determination from FCIC that the insurance provider, its agent or loss adjuster failed to comply with the terms of the policy or procedures issued by FCIC and such failure resulted in the producer receiving an indemnity, prevented planting payment or replant payment in an amount that is less than the amount to which the producer was entitled. FCIC is responsible for making these determinations to ensure the uniform application of the policies and procedures.

In accordance with 7 C.F.R. 400.765 (c), this Final Agency Determination is binding on all participants in the Federal crop insurance program for the 2007 and succeeding crop years. Any appeal of this decision must be in accordance with 7 C.F.R. 400.768(g).

Date of Issue: May 4, 2009