In-Season Price Option Example

The following is an example only and does not reflect actual prices as listed in the price tables elsewhere.

 

 

If the base price for barley on your coverage detail is $100/T ($0.100 kg), your individual coverage is 1,000 kg/acre and you selected 80% coverage, your liability would be:

Liability = 1,000 kg/acre x 80% x $0.100/kg
            = $80.00/acre

If your premium rate is 5.75% and your experience discount is 0%, your premium would be:

Premium = $80.00/acre x 5.75% less 0%
              = $4.60/acre

The insured price is then reset based upon a six month average of market prices (September - February). If the price increases to $110/T ($0.110 kg), your liability is calculated using the new insured price as follows:

Liability = 1,000 kg/acre x 80% x $0.110/kg
            = $88.00/acre

Premium = $4.60/acre (Premium is not adjusted.)

If the insured price decreases based on the six month average price to $90/T ($0.090/kg), your liability is calculated using the new insured price as follows:

Liability = 1,000 kg/acre x 80% x $0.090/kg
            = $72.00/acre

Premium = $4.60/acre (Premium is not adjusted.)