A Group Risk Income Protection (GRIP) policy is a county-based insurance product that pays the policyholder in the event the actual county revenue falls below the county trigger revenue selected by the policyholder.

Policyholders are eligible for a payment when the actual county revenue drops below the county trigger revenue that they choose. The trigger revenue is calculated by multiplying the GRIP price by the expected county yield, then multiplying this by the level of coverage (90, 85, 80, 75, or 70 percent). The GRIP price is the average futures closing prices during the month of February. For corn, the December futures contract prices are used, while soybean uses the November futures contract prices.

The actual county revenue is computed by multiplying the actual county yield by the harvest price. The harvest price for soybeans is the average of the November futures contract price during October while for corn, it is the average of the December futures contract price during October.

The amount of payment the policyholder receives depends on the level of protection selected. A policyholder can choose a level from 60-100% of the maximum available protection. That maximum available protection is set each year by the Risk Management Agency (RMA).

A policyholder can elect to purchase GRIP insurance with the Harvest Option (HO) where the revenue guarantee does increase if the harvest price is higher than the February price.

Special Notes on GRIP:

GRIP does not cover replant, late planting, prevented planting, or loss specific to the policyholder’s unit. GRIP is strictly a county policy, and a loss is determined based upon county yield only.

GRIP has a $1.50 price fluctuation limit for corn and $3.00 price fluctuation limit for soybeans from spring to harvest.

Indemnity payments are based off of the actual county yields, therefore they are paid in the spring of the following year.

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