Livestock Risk Protection (LRP) is price insurance for livestock. Producers may choose from a variety of coverage levels and insurance periods that correspond with the projected marketing date of their livestock. The coverage is a price floor that limits loss to the protection level selected by the producer, who in turn pays a premium for that protection after the coverage period ends. It does not limit any gains or upward price movement in the market.
We offer this as another risk management tool in our “toolbox” because of these advantages for producers:
- No margin money required; it is an insurance product not a market product
- Premium is not due until AFTER the coverage period ends
- Up to 25,000 head of Feeder Cattle may be insured per crop year
- Up to 25,000 head of Fed Cattle may be insured per crop year
- Feeder Cattle insurance averages $15/head cheaper than a bought put (futures market price floor)
- Fed Cattle insurance averages $18/head cheaper than a bought put
- Coverage is placed per head of livestock, so cattle owners can protect their exact inventory
As a risk management office focused on the cattle industry, one of the most critical reasons we offer this is because it is a risk management tool for cattle. Cattle risk management is our expertise! Our initial research into this price insurance product and its use revealed very few risk managers or insurance agents with practical experience using LRP. Furthermore, LRP has a history of being disregarded and unused by the industry. Significant changes were made to the LRP program that now created critical advantages for the producer.
NON-DISCRIMINATION STATEMENT: Compass Ag Insurance LLC is an equal opportunity provider. In accordance with Federal law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions participating in oradministering USDA programs are prohibited from discriminating on the basis of race, color,national origin, religion, sex, gender identity (including gender expression), sexual orientation, disability, age, marital status,family/parental status, income derived from a public assistance program, political beliefs, or reprisal or retaliation for prior civilrights activity, in any program or activity conducted or funded by USDA (not all bases apply to all programs). The information contained in this brochure is for general information only and shall not represent nor modify the terms of any insurance policy.