Which type of insurance plan is not included in the common crop insurance policy?

Which type of insurance plan is not included in the common crop insurance policy?

• A. Individual insurance plan
• B. Area Risk Protection Insurance plan
• C. Yield protection plan
• D. Revenue insurance plan

Answer: (B)

The correct choice indicates that the Area Risk Protection Insurance (ARPI) plan is not typically included in the common crop insurance policy. Common crop insurance policies usually consist of individual crop insurance plans that provide coverage based on the specific yields of an insured farm. Individual insurance plans are designed to protect farmers based on their individual production history and yields. Yield protection plans cover losses based on a drop in yield compared to a predetermined benchmark. Revenue insurance plans protect against losses in revenue caused by decline in price as well as yield losses. In contrast, the ARPI plan operates on a broader level, providing coverage based on aggregate losses in a specific area instead of individual farms. This type of insurance is aimed at managing risk at a regional scale rather than at the individual farm level, which is why it is not categorized within the typical offerings of common crop insurance policies.

The correct choice indicates that the Area Risk Protection Insurance (ARPI) plan is not typically included in the common crop insurance policy. Common crop insurance policies usually consist of individual crop insurance plans that provide coverage based on the specific yields of an insured farm.

Individual insurance plans are designed to protect farmers based on their individual production history and yields. Yield protection plans cover losses based on a drop in yield compared to a predetermined benchmark. Revenue insurance plans protect against losses in revenue caused by decline in price as well as yield losses.

In contrast, the ARPI plan operates on a broader level, providing coverage based on aggregate losses in a specific area instead of individual farms. This type of insurance is aimed at managing risk at a regional scale rather than at the individual farm level, which is why it is not categorized within the typical offerings of common crop insurance policies.