PRF Insurance in Oregon

PRF insurance, also known as Pasture, Rangeland, and Forage insurance, is a type of crop insurance specifically designed to protect ranchers in Oregon and the rest of the contiguous United States against losses caused by drought or lack of precipitation. 

It serves as a USDA-subsidized risk management tool for livestock producers, providing financial assistance in the event of dry conditions that result in forage loss or decline. 

What is PRF Insurance?

Pasture, Rangeland, and Forage (PRF) insurance is a USDA-subsidized crop insurance program designed for ranchers, rather than crop farmers. 

This tool enables ranchers to protect their profit margin from the financial impacts of diminished forage production due to a lack of rainfall. 

How Does PRF Insurance Work?

PRF insurance works by triggering indemnities or loss checks for insured ranchers when rainfall in their area falls below their chosen coverage threshold during any of their insured intervals. Here’s a breakdown of the process:

1. You set your policy’s coverage level between 70%-90% of average rainfall. 
2. Your Redd Summit agent works with you to choose your policy’s coverage intervals* based on your land’s historical rainfall data.
3. NOAA** rainfall stations record the amount of rainfall your land’s grid receives during a coverage interval.
4. The NOAA rainfall data is then reported to the USDA’s Risk Management Agency (RMA) at the close of each interval.  
5. If the RMA determines that your insured grid received less than your chosen coverage level of rainfall during one of your insured intervals, you’ll be issued an indemnity to your policy, or a loss check. 

*PRF insurance is allocated in two-month intervals throughout the year (i.e. Jan.-Feb., Feb.-Mar., Mar.-Apr., etc.)

** NOAA is an acronym of the National Oceanic and Atmospheric Administration.

Is PRF Insurance Worth It In Oregon?

Some areas in Oregon are known for their degree of moisture. However, much of the state is currently categorized as being within an active drought. For ranchers operating in Oregon under drought conditions, PRF insurance is worth considering. 

What are the Benefits of PRF Insurance?

• Financial protection: PRF Insurance can help compensate for the loss of revenue caused by lack of rainfall.
• Flexibility: Ranchers insured through Redd Summit enjoy customized coverage that their agent has tailored to meet their needs and personal risk tolerance.
• Ease of access: Signing up for PRF Insurance is extremely easy, and the qualification criteria is minimal.

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What Events Does PRF Insurance Cover?

PRF insurance policies only operate based on rainfall data. It provides protection against the impact of below-average precipitation and does not insure other weather-related events or disasters. 

What is the Coverage Period for PRF Insurance?

Your PRF Coverage can insure your operation for 2-month intervals throughout the year. This means that your coverage periods can be January-February, March-April, May-June, and so on. 

How are PRF Insurance Indemnities Calculated?

PRF insurance is calculated based on historical rainfall data and the coverage level chosen by the policyholder. The calculation looks like this: 

(coverage level - % of normal rainfall)(coverage level x $ of coverage per interval)

Drought Insurance Vs. PRF Insurance: What’s The Difference

Pasture, Rangeland, and Forage (PRF) insurance is often nick-named “Drought Insurance”, though it’s important to remember that “drought insurance” doesn’t actually exist. 

PRF insurance enables ranchers to protect their bottom line from the financial impact of lower-than-average precipitation but does not require that a rancher’s area fall within drought parameters to receive coverage. 

What Happens To Your PRF Policy If You Receive Excessive Rainfall?

If you receive excessive rainfall throughout your coverage intervals, you will likely owe a portion or the entirety of your PRF premium. 

This is because PRF insurance policies are self-funding, which means that indemnities are first credited toward your premium balance until it is satisfied in full. Any additional indemnities are issued directly to you in the form of loss checks. 

Frequently Asked Questions

What is PRF insurance and how does it work in Oregon?

PRF insurance, also known as Pasture, Rangeland, Forage insurance, is a program subsidized by the USDA's Risk Management Agency (RMA) that provides coverage for pasture, rangeland, or forage acres based on the national rainfall index.

In Oregon, this program enables ranchers to protect against forage losses due to a lack of precipitation. It uses historical average precipitation data and a grid system to determine coverage and compensation for losses.

How do I sign up for PRF insurance in Oregon?

To sign up for PRF insurance in Oregon, contact a Redd Summit agent at (435) 625-1022.

How are indemnity payments determined for PRF insurance in Oregon?

Indemnities through PRF insurance in Oregon are determined based on the decline in the rainfall index value compared to the historical average precipitation for specific two-month intervals. 

The program uses a comprehensive dataset from the National Oceanic and Atmospheric Administration Climate Prediction Center (NOAA CPC) to calculate the payments automatically. There is no need for claim forms or adjusters, as indemnity is issued automatically based on the data from NOAA CPC.

Is PRF insurance worth it for livestock producers in Oregon?

PRF insurance can be a valuable risk management tool for livestock producers in Oregon. It provides coverage for losses of forage due to a lack of precipitation.