Approved Procedures for Submission of Index-Based Weather Plans of Insurance

United States
Department of
Agriculture

Federal Crop
Insurance
Corporation

FCIC-17050 (08-2016)

APPROVED
PROCEDURES
FOR SUBMISSION
OF INDEX-BASED
WEATHER PLANS
OF INSURANCE
Effective upon approval until
obsolete

RISK MANAGEMENT AGENCY
KANSAS CITY, MO 64133
TITLE: APPROVED PROCEDURES FOR
SUBMISSION OF INDEX-BASED
WEATHER PLANS OF INSURANCE
EFFECTIVE DATE: Upon Approval
Until Obsolete
SUBJECT:
Provides the procedures for the submission
of Index-based Weather Plans of Insurance.

NUMBER:

FCIC-17050

ISSUE DATE:

August 12, 2016

OPI: FCIC Board of Directors
Approved:
/s/ Robert Johansson
Chairman, FCIC Board of Directors

REASON FOR ISSUANCE
This handbook is issued to provide approved standards for the submission of Index-based Weather
Plans of Insurance. All Index-based Weather Plans of Insurance submitted to the FCIC Board of
Directors for approval must be submitted in accordance with this handbook.

August 2016

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APPROVED PROCEDURE FOR SUBMISSION OF INDEX-BASED WEATHER PLANS OF
INSURANCE
CONTROL CHART
FCIC Approved Procedures for Submission of Index-based Weather Plans of Insurance

Current
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FILING INSTRUCTIONS
This handbook is new and does not replace any existing handbook. This handbook is effective upon
approval and until obsolete.

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FCIC BOARD OF DIRECTORS APPROVED PROCEDURE FOR SUBMISSION OF INDEXBASED WEATHER PLANS OF INSURANCE
TABLE OF CONTENTS
PAGE NO.
PART 1
1
2
3
4-10
PART 2

GENERAL INFORMATION AND RESPONSIBILITIES
Basis, Purpose, and Applicability .............................................................................................. 1
Confidentiality ........................................................................................................................... 1
Timing and Format .................................................................................................................... 1
(Reserved)
SUBMISSION STANDARDS

11 Contents of a Complete Index-based Weather Plan of Insurance ............................................. 2
12 Presentation to the Board.... ....................................................................................................... 8
13-20 (Reserved)
PART 3

REVIEW AND APPROVAL

21 Review .......................................................................................................................................9
22 Prioritization ............................................................................................................................11
23-30 (Reserved)
PART 4

APPROVED INDEX-BASED WEATHER PLANS OF INSURANCE

31 Applicant Roles and Responsibilities ...................................................................................... 12
32 FCIC Roles and Responsibilities ............................................................................................. 12
33 Availability for Sale by other AIPs ......................................................................................... 13
34 User Fees ................................................................................................................................. 14
35-40 (Reserved)
EXHIBITS
1
2

Acronyms and Abbreviations .................................................................................................. 15
Definitions ............................................................................................................................... 16

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PAGE INTENTIONALLY LEFT BLANK

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PART 1 GENERAL INFORMATION
1

Basis, Purpose, and Applicability
These procedures establish guidelines and responsibilities of FCIC and the applicant for the
submission of Index-based Weather Plans of Insurance to the FCIC Board of Directors (Board)
for approval as authorized under section 523(i) of the Act.

2

Confidentiality
Refer to 7 C.F.R. §400.702 for confidentiality requirements. In addition to the requirements in 7
C.F.R. §400.702, the applicant must state, within the IBWP submission, if the name of the IBWP
name may be used in Board documents, including but not limited to, the agenda, minutes, and
Board memoranda. The applicant cannot use false names to mislead the public regarding the
nature of the IBWP. If permission is not given to use the name of the IBWP, the IBWP will
simply be referred to as a “Section 523(i) IBWP.”

3

Timing and Format
Refer to 7 C.F.R. §400.703 for timing and format requirements.

4-10 (Reserved)

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PART 2 SUBMISSION STANDARDS
11

Contents of a Complete Index-based Weather Plan of Insurance
A complete Index-based Weather Plan of Insurance must contain the following material, as
applicable, in the order given.
(1)

The applicant’s name (entity name), tax identification number, D-U-N-S number, address
or primary business location, phone number, and e-mail address.

(2)

A notation that it is an Index-based Weather Plan of Insurance submitted in accordance
with FCIC procedures handbook 17050 - Approved Procedures for Submission of IndexBased Weather Plans of Insurance.

(3)

A summary of the qualifications of the applicant, including:

(4)

(a)

A list of the policies or plans of insurance the submitter has underwritten and
administered that are comparable to the Index-based Weather Plan of Insurance, a
description of these policies, and for each year the policies were sold the number of
policies sold, total premium, liability and the loss ratio (comparable policies may
include index-based policies that are not reinsured by FCIC);

(b)

The most recent credit rating score of the submitter provided by AM Best credit rating
bureau that reflects a credit rating of at least A- or above. If an AM Best credit rating
is below A- a full explanation of the reasons for such rating and any corrective actions
that have been taken to remediate the issue must be provided; and

(c)

For each state for which approval from FCIC is requested, the applicant must provide
a letter from the state, stating the submitter has:
(i)

Authority and approval from the state to sell the product, including how much
liability or the number of Index-based Weather policies that the submitter can
write in the state; and

(ii)

Sufficient assets or reinsurance to satisfy the underwriting obligations for the
Index-based Weather Plan of Insurance, including the value of assets or
reinsurance dedicated to the Index-based Weather Plan of Insurance.

A statement of whether the applicant is requesting:
(a)
(b)
(c)

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Risk subsidy;
A&O subsidy; or
Both risk and A&O subsidy.

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Contents of a Complete Index-based Weather Plan of Insurance (Continued)
(5)

If risk subsidy is requested, an explanation of the amount of risk subsidy requested, which
must be similar to comparable policies or plans of insurance reinsured by FCIC, except that
the risk subsidy shall not exceed 60 percent of the total premium, and a detailed outline of
the proposed method for determining the amount of risk subsidy calculated using one of the
following methods:
(a)

A percentage of premium;

(b)

A percentage of expected loss determined pursuant to a reasonable actuarial
methodology; or

(c)

A fixed dollar amount per acre.

(6)

If A&O subsidy is requested, an explanation of the amount of A&O subsidy requested and
a breakdown of the method and factors used to determine the Index-based Weather Plan of
Insurance’s A&O subsidy rate being requested. The submitter must include a statement
that no portion of the A&O subsidy will be used as a subsidy for premiums or provided to
the policyholder as an incentive to purchase a policy or for any other reason.

(7)

The proposed agricultural commodities to be insured, including types, varieties, and
practices covered by the policy.

(8)

The crop or insurance year and reinsurance year in which the Index-based Weather Plan of
Insurance is proposed to be available for purchase by producers.

(9)

The sales closing date, if applicable, or if not applicable, the earliest date the applicant
expects to release the product to the public.

(10) A list of counties and states the submission is proposed to be offered;
(11) Any known or anticipated future expansion plans.
(12) Identification, including names, addresses, telephone numbers, and e-mail addresses of the
person(s) responsible for addressing questions regarding the policy, underwriting rules, loss
adjustment procedures, rate and price methodologies, data processing and record-keeping
requirements, and any other questions that may arise in implementing or administering the
program, if it is approved.
(13) A statement of whether the submitter wants the Index-based Weather Plan of Insurance to
remain confidential.
(14) Benefits of the plan, including, as applicable, a summary that includes:
(a)

August 2016

Detailed description of the coverage provided by the Index-based Weather Plan of
Insurance and its applicability to all producers, including targeted producers;

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Contents of a Complete Index-based Weather Plan of Insurance (Continued)
(b)

How the Index-based Weather Plan of Insurance offers coverage or other benefits not
currently available from existing public or private programs;

(c)

How the Index-based Weather Plan of Insurance provides producers of underserved
specialty crops and livestock commodities coverage; and

(d)

How the Index-based Weather Plan of Insurance meets public policy goals and
objectives consistent with the Act and other laws.

(15) The policy, including all applicable policy provisions, that is clearly written in plain
language in accordance with the Plain Writing Act of 2010 (5 U.S.C. § 301) such that
producers will be able to understand the coverage being offered. The policy language
permits actuaries to form a clear understanding of the payment contingencies for which
rates will be set. The policy language does not encourage an excessive number of disputes
or legal actions because of misinterpretations. Include a list of any additional coverage that
may be elected by the insured in conjunction with the Index-based Weather Plan of
Insurance such as applicable endorsements (include a description of the coverage and how
such coverage may be obtained).
(16) The amount of commodity (acres, head, board feet, etc.) and the value of each agricultural
commodity proposed to be covered in each proposed county and state;
(17) A reasonable estimate of expected number of potential buyers, liability and premium for
each proposed county and state, total expected liability and premium by crop year based on
the detailed assessment of producer interest, including a description of the number of
producers involved in the development of the product, their level of participation, their type
of participation, how many producers have provided data to assist the submitter in the
development of the product, and a comparison with other similar products, including
differences between the Index-based Weather Plan of Insurance and the similar products
that may make participation different;
(18) If available, insurance experience for each year and in each county and state the policy has
been previously offered for sale including an evaluation of the policy’s performance and, if
data are available, a comparison with other similar insurance policies reinsured under the
Act;
(19) Market research studies; “market research” is the systematic gathering and interpretation of
information about individuals or organizations using statistical and analytical methods and
techniques of the applied social sciences to gain insight or support decision making, and
that must include:

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Contents of a Complete Index-based Weather Plan of Insurance (Continued)
(a)

Focus group results (both positive and negative reactions) where a discussion is
facilitated amongst a group of stakeholders in order to gain insight into their
perceptions, opinions, beliefs, and attitudes towards a product, which must include the
number of focus group sessions held, where they were held, when they were held, the
number of attendees at each session, the attendees affiliation (producer, agent or
other), and specific feedback from the attendees regarding levels of coverage the
product should include to cover anticipated risks or perils encountered, the range of
costs the producer is willing to pay, what coverages the producers are specifically
looking for and an assessment of whether that coverage can be provided at the price
the producers are willing to pay, what shortfall or gap in risk protection the product
may address, tolerance of risk, perceptions of other similar products, policy features
producers may desire, and quality issues;

(b)

Other evidence the proposed Index-based Weather Plan of Insurance will be
positively received by producers, agents, lending institutions, and other interested
parties, including correspondence from producers, agents, grower organizations, or
other stakeholders expressing the need for a certain risk management strategy, desired
coverage for perils faced, and willingness to provide critical information for
developing a product;

(c)

An assessment of factors that could negatively or adversely affect the market and
responses from a reasonable representative cross-section of producers or significant
market segment to be affected by the policy or plan of insurance; and

(d)

A consultation report must be provided that includes a summary and analysis of
discussions with groups representing producers of those agricultural commodities in
all major producing areas for commodities to be served or potentially impacted, either
directly or indirectly, and the expected impact of the Index-based Weather Plan of
Insurance on the general marketing and production of the crop from both a regional
and national perspective including evidence that the Index-based Weather Plan of
Insurance will not create adverse market distortions;

(20) A marketability assessment from the applicant AIP who is part of the applicant and from at
least one other AIP. If a marketability assessment is not provided by a separate AIP who is
not part of the applicant, the applicant must provide information regarding the names of the
persons and AIPs contacted and the basis for their refusal to provide the marketability
assessment. The marketability assessment will include:
(a)

An assessment of whether producers will buy the Index-based Weather Plan of
Insurance;

(b)

An assessment of whether AIPs and their agents will want to sell and service the
Index-based Weather Plan of Insurance;

(c)

An assessment of the risks associated with the Index-based Weather Plan of Insurance
and its likely effect under the SRA;

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Contents of a Complete Index-based Weather Plan of Insurance (Continued)
(d)

Estimated computer system impacts and costs;

(e)

Estimated administrative and training requirement and costs;

(f)

An analysis of the complexity of the product; and

(g)

What, if any, efficiency will be gained or potential effects on the workload of AIPs or
others participating in the program.

(21) Information related to the underwriting, including as applicable:
(a)

Relevant dates;

(b)

Rules for determining insurance eligibility, including all producer reporting
requirements; and

(c)

Step-by-step examples of the data and calculations needed to establish the insurance
guarantee (liability) and premium per acre or other unit of measure, including
worksheets that provide the calculations in sufficient detail and in the same order as
presented in the policy to allow verification that the premiums charged for the
coverage are consistent with policy provisions.

(22) Information related to loss adjustment, including, as applicable:
(a)

A detailed description of the causes of loss covered by the policy or plan of insurance
and any causes of loss excluded;

(b)

Loss determination methods and data sources used for determining losses based on
the index; and

(c)

Step-by-step examples of calculations used to determine indemnity payment for all
probable situations where a partial or total loss may occur, and loss adjustment
procedures that are necessary to establish the amounts of coverage and loss.

(23) Information related to rates of premium, including, as applicable:
(a)

A detailed description of the premium rating methodology proposed to be used and
the basis for selection of the rating methodology;

(b)

A list of all assumptions made in the premium rating methodology and the basis for
these assumptions;

(c)

A detailed description of the rating methodology, including:
(i)

August 2016

All supporting documentation, including how expenses, profit, and overhead are
calculated and included in the rate;

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Contents of a Complete Index-based Weather Plan of Insurance (Continued)
(ii)

All mathematical formulas and equations;

(iii) Data and data sources used in determining rates and a detailed assessment of the
data and how it supports the proposed rates;
(iv) An explanation of how the rates account for each of the risks covered by the
policy; and
(v)

An explanation of how the loss triggers are applicable to the policy and how the
rates are actuarially appropriate for each type of loss trigger available under the
policy;

(d)

An example of a rate calculation for each type of loss trigger available under the
policy;

(e)

A discussion of the applicant’s objective evaluation of the accuracy and adequacy of
the data used to establish rates and determine losses, the short and long term
availability of the data, and how the data will be obtained (if the data source is
confidential or proprietary explain the cost of obtaining the data); and

(f)

An analysis of the results of simulations or modeling showing the performance of
proposed rates for all types of loss triggers available under the policy, based on one or
more of the following (such simulations must use all years of experience available to
the applicant and must reflect both partial losses and total losses).
(i)

A simulation that shows liability, premium, indemnity, and loss ratios for the
proposed insurance product based on the probability distributions used to
develop the rates and establish loss triggers, as applicable, and the impact of
inappropriate assumptions.

(ii)

Any other comparable simulation that provides results indicating both aggregate
and individual performance of the Index-based Weather Plan of Insurance
including expected liability, premium, indemnity, and loss ratios for the
proposed insurance product, under various scenarios depicting good and poor
actuarial experience.

(24) The proposed user fees and the submitter will charge other AIPs to sell the Index-based
Weather Plan of Insurance established in accordance with paragraph 34.
(25) A statement from the submitter that, if the Index-based Weather Plan of Insurance is
approved, the submitter is solely responsible for the maintenance and quality assurance of
any computer systems software or databases needed for the implementation and delivery of
the product.

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Contents of a Complete Index-based Weather Plan of Insurance (Continued)
(26) A statement from the submitter that, if the Index-based Weather Plan of Insurance is
approved, the submitter will report sales, acreage and claim data, and any other data FCIC
determines to be appropriate to evaluate the sales and performance of the product or the
financial status of the AIP.
(27) Executed (signed) certification statements in accordance with the following:
(a)

“{Applicant’s Name} hereby claim that the basis and amounts set forth in this
document are correct;” and

(b)

“{Applicant Name} understands that, in addition to criminal fines and imprisonment,
the submission of false or fraudulent statements or claims may result in civil and
administrative sanctions.”

(28) A statement of whether the submitter wants the Index-based Weather Plan of Insurance to
remain confidential.
12

Presentation to the Board
Refer to 7 C.F.R. §400.707 for information on presenting Index-based Weather Plans of
Insurance to the Board.

13-20 (Reserved)

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PART 3 REVIEW AND APPROVAL
21

Review
If the Board determines the Index-based Weather Plan of Insurance to be complete and sends to
expert review:
(1)

(2)

The reviewers will each provide their individual assessment of whether the Index-based
Weather Plan of Insurance:
(a)

Protects the interests of agricultural producers and taxpayers;

(b)

Is actuarially appropriate;

(c)

Follows recognized insurance principles;

(d)

Does not contain excessive risks;

(e)

Follows sound, reasonable, and appropriate underwriting principles;

(f)

Contains a marketing plan that reasonably demonstrates the product would be or is
viable and marketable; and

(g)

Meets any other criteria the Board may deem necessary;

RMA will provide assessment of whether the Index-based Weather Plan of Insurance:
(a)

Meets the criteria listed in subparagraph 21 (1)(a) through (g);

(b)

Does not increase or shift risk to any other FCIC reinsured policy;

(c)

Will provide a new kind of coverage for specialty crops and livestock commodities
that previously had no available crop insurance, or has demonstrated a low level of
participation under existing coverage;

(d)

Will not have a significant adverse impact on the crop insurance delivery system;

(e)

Has been approved for sale by each State the submitter intends to sell the product
(RMA will contact the State insurance commissions to verify approval);

(f)

Contains requested amounts of risk subsidy, and A&O subsidies that are reasonable
and appropriate for the type of coverage provided by the policy;

(g)

Was submitted by an AIP with:
(i)

August 2016

Adequate experience underwriting and administering policies or plans of
insurance that are comparable to the proposed policy or plan of insurance;

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Review (Continued)
(ii)

Sufficient assets or reinsurance to satisfy the underwriting obligations for the
Index-based Weather Plan of Insurance. RMA will verify the submitter meets
the financial requirements contained in 7 C.F.R., Part 400, Subpart L –
Reinsurance Agreement – Standards for Approval; Regulations for the 1997 and
Subsequent Reinsurance Years;

(iii) A sufficient insurance credit rating from an appropriate credit rating bureau; and
(iv) Applicable authority and approval from each state in which the AIP intends to
sell the insurance product;
(h)
(3)

Does not provide coverage substantially similar to privately available hail insurance.

In addition to 7 C.F.R. § 400.706(m) the Board may disapprove an Index-based Weather
Plan of Insurance if it determines:
(a)

The interests of producers and taxpayers are not protected, including but not limited
to:
(i)

The Index-based Weather Plan of Insurance does not provide adequate coverage
or treats producers disparately;

(ii)

The Index-based Weather Plan of Insurance will not provide a new kind of
coverage that is likely to be viable and marketable;

(iii) Coverage will not provide a new kind of coverage for specialty crops or
livestock commodities that previously had no available crop insurance, or have
demonstrated a low level of participation under existing coverage;
(iv) The Index-based Weather Plan of Insurance may create adverse market
distortions or adversely impact other crops or agricultural commodities if
marketed;
(v)

The Index-based Weather Plan of Insurance will have a significant adverse
impact on the crop insurance delivery system;

(vi) The Index-based Weather Plan of Insurance will have an adverse impact on
program integrity; or
(vii) The Index-based Weather plan of insurance has not been approved for sale in
the proposed states;
(b)

August 2016

The premium rates are not actuarially appropriate;

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22

Review (Continued)
(c)

The Index-based Weather Plan of Insurance does not conform to sound insurance and
underwriting principles;

(d)

The risks associated with the Index-based Weather Plan of Insurance are excessive or
it increases or shifts risk to an FCIC reinsured policy;

(e)

The Index-based Weather Plan of Insurance or the applicant does not meet the
requirements of the Act; or

(f)

The Index-based Weather Plan of Insurance will provide coverage substantially
similar to privately available hail insurance.

Prioritization
Refer to §400.706(d)(4) for approval prioritization for Index-based Weather Plans of Insurance.

23-30 (Reserved)

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PART 4 APPROVED INDEX-BASED WEATHER PLANS OF INSURANCE
31

Applicant Roles and Responsibilities
(1)

After an Index-based Weather Plan of Insurance is approved by the Board, an agreement
between the applicant and FCIC must be completed that specifies the responsibilities of
each with respect to the implementation, delivery and maintenance of the Index-based
Weather Plan of Insurance; and the required timeframes for submission of any information
and documentation needed to administer the approved Index-based Weather Plan of
Insurance.

(2)

In addition to 7 C.F.R. § 400.709(a) the applicant is responsible for the following.

(3)

32

(a)

Maintenance and quality assurance of any computer systems software or databases
needed for the implementation and delivery of the product.

(b)

Reporting sales, acreage and claim data, and any other data the Corporation
determines to be appropriate to evaluate the sales and performance of the product in
accordance with FCIC procedures.

(c)

Complying with FCIC procedures to ensure the Index-based Weather Plan of
Insurance does not have a significant adverse impact on the crop insurance delivery
system, the best interest of producers is protected, and program integrity is preserved.

(d)

Informing FCIC if state approval for the Index-based Weather Plan of Insurance has
been withdrawn.

(e)

Submitting the information required, in the format required, by FCIC to provide
applicable risk and A&O subsidy.

Any changes, both non-significant and significant, must be submitted to FCIC in
accordance with this handbook no later than 180 days prior to the earliest contract change
date for the commodity in all counties or states in which the policy or plan of insurance is
sold. Significant changes must be submitted to the Board for review in accordance with 7
C.F.R. part 400, subpart V and these procedure and will be considered a new Index-based
Weather Plan of Insurance.

FCIC Roles and Responsibilities
(1)

In addition to 7 C.F.R. § 400.709(b) FCIC is responsible for the following.
(a)

Approving other AIPs who seek to sell the policy or plan of insurance.

(b)

If requested and approved, providing risk subsidy or A&O subsidy, in accordance
with FCIC procedures.

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32

33

FCIC Roles and Responsibilities (Continued)
(2)

If at any time prior to the cancellation date, FCIC discovers there is a mistake, error, or flaw
in the policy, plan of insurance, related materials, rates of premium, or any other reason for
withdrawal of approval, FCIC will deny A&O, if applicable, and risk subsidy for such
policy or plan of insurance. If approval is withdrawn, a written notice will be provided on
RMA’s website at www.rma.usda.gov.

(3)

At any time after approval, the Board may review the Index-based Weather Plan of
Insurance and request additional information to determine whether the Index-based
Weather Plan of Insurance complies with statutory or regulatory changes or court orders, is
still actuarially appropriate, protect program integrity and the interests of producers, and is
still approved to be sold in the applicable state(s). The Board will notify the applicant of
any problem or issue that may arise and allow the applicant an opportunity to make any
needed change. The Board may withdraw approval for an Index-based Weather Plan of
Insurance if:
(a)

The applicant fails to perform the responsibilities stated under this paragraph;

(b)

The applicant does not timely and satisfactorily provide materials or resolve any issue
to the Board’s satisfaction so that necessary changes can be made prior to the earliest
contract change date;

(c)

The Index-based Weather Plan of Insurance is not sufficiently marketable according
to the applicant’s estimate or fails to perform sufficiently as determined by the Board;

(d)

The interest of producers or tax-payers is not protected or the continuation of the
program raises questions or issues of program integrity; or

(e)

State approval for the Index-based Weather Plan of Insurance is withdrawn in states
previously approved.

Availability for Sale by other AIPs
An Index-based Weather Plan of Insurance approved by the Board will be made available for sale
by other AIPs under the same terms and conditions provided to the submitter, in accordance with
this paragraph.
(1)

AIPs that want to sell an Index-based Weather Plan of Insurance approved by the Board
must submit a formal request to FCIC by sending the following information to the Deputy
Administrator of Product Management at [email protected].
(a)

Name and address of the AIP.

(b)

A statement requesting to sell an FCIC approved Index-based Weather Plan of
Insurance (specify the name of the plan).

(c)

A user fee agreement between the AIP and the submitter.

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33

Availability for Sale by other AIPs (Continued)
(d)

34

The information required under subparagraph 11 (3).

(2)

If the Board determines the AIP submitted the required information and to the Boards
satisfaction meets the obligations outlined in subparagraph 21 (2)(g), the Board will provide
written notification authorizing the AIP to sell the Index-based Weather Plan of Insurance.

(3)

If at any time the Board determines the obligations of the AIP are not being met, the Board
may revoke the right to sell the Index-based Weather Plan of Insurance by providing
written notification.

User Fees
(1)

Requests for approval of the user fee must be accompanied by written documentation to
support the amount requested, which may only cover direct costs to maintain the plan of
insurance.

(2)

The Board will approve the amount of user fee that is payable to the applicant by the AIP
unless the Board determines that the user fee charged unnecessarily inhibits the use of the
policy or plan of insurance by AIPs.

(3)

A user fee unnecessarily inhibits the use of a policy or plan of insurance if it is so high that
AIPs will not sell the policy.

(4)

It is the sole responsibility of the applicant to collect such fees from an AIP and any
indebtedness for such fees must be resolved by the applicant and AIP.

(5)

Every two years after approval of a user fee, or if the applicant has made a significant
change to the approved Index-based Weather Plan of Insurance, applicants must submit
documentation to the Board for review in determining if the user fee should be revised.

(6)

The Board may review the amount of the user fee at any time at its sole discretion.

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Exhibit 1
Acronyms and Abbreviations
The following table provides the acronyms and abbreviations used in this handbook.
Approved
Acronym/Abbreviation
A&O
AIP
C.F.R.
FCIC
OGC
RMA
USDA

August 2016

Term
Administrative and Operating
Approved Insurance Provider
Code of Federal Regulations
Federal Crop Insurance Corporation
Office of the General Counsel
Risk Management Agency
United States Department of Agriculture

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Exhibit 2
Definitions
The definitions from subpart V apply to these procedures unless otherwise specified in this
exhibit. In addition to the definitions in subpart V:
Complete means an Index-based Weather Plan of Insurance determined by RMA and the Board
to contain all required documentation in accordance with paragraph 11.
Marketable means a determination by the Board that a sufficient number of producers will
purchase the Index-based Weather Plan of Insurance to justify subsidies. This determination
must be based on credible information provided by the applicant.
Sufficient Assets include cash and other liquid assets such as stocks and bonds that can easily be
converted to currency, that in aggregate have a monetary value greater than or equal to the
expected amount of liability for a crop year.
Sufficient Quality is a determination made by RMA and the Board that the material presented is
clearly written in plain language in accordance with the Plain Writing Act of 2010 (5 U.S.C.
301), unambiguous, and is supported by detailed analysis and data so that expert reviewers, RMA
and the Board can understand, comprehend and make calculations, draw substantiated
conclusions or results to determine whether the index-based weather plan of insurance meets the
standards required for approval.

August 2016

FCIC-17050

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