August 19, 1999

INFORMATIONAL MEMORANDUM: R&D-99-036

TO:          All Reinsured Companies
             All Risk Management Agency Field Offices

FROM:        Tim B. Witt	/s/ Tim B. Witt
             Deputy Administrator

SUBJECT:    Pilot Coverage Enhancement Option (CEO) for the 2000/2001 Crop Years Now
	    Available on the Reporting Organization (RO) Server

BACKGROUND:

The Risk Management Agency (RMA) has placed the Pilot Coverage Enhancement Option (CEO), applicable Producer Premium Percentage Tables, and Questions and Answers on the RMA WebSite/Reporting Organization (RO) Server for the crops and crop years listed below. These files are available in both Acrobat PDF and WordPerfect WPD formats. The information is available on RMA's WebSite at http://www.rma.usda.gov/policies/2000policy.html, or through the RO Server under the /Policies/2000/crops directory. CEO requires new Producer Premium Percentage Tables that are available on RMA's WebSite at http://www.rma.usda.gov/FTP/Reference/prodpremprcnt. Actuarial documents that have already been filed will not be refiled to reflect the availability of CEO. However, the Actuarial Data Master (ADM) will be modified to reflect this option.

CEO is an option that attaches to a crop's Multiple Peril Crop Insurance (MPCI) policy provisions. If a loss is payable under the MPCI policy, this option retroactively reduces the MPCI deductible, thereby increasing the amount of coverage and indemnity.

Draft changes to Manual 13 incorporating CEO information will be available for company comment the week of August 16, 1999, on RMA's WebSite at

http://www.rma.usda.gov/actuarial/draft2000.html.

INFORMATIONAL MEMORANDUM: R&D-99-036 2

For insureds to obtain CEO coverage, an insurance application identifying the option code "CE" and the CEO coverage level percent elected must be completed by the crop's sales closing date. The option code "CE" should appear at the end of the common option code data string for electronic data transmission purposes. CEO does not change the common option factors under the MPCI policy.

The pilot CEO program is available for the following crops, States, plans of insurance, beginning with the crop year shown:

Crop State* Insurance Plan First Crop Year

Apples Pennsylvania 86 2000

Apples Washington 86 2000

Canola North Dakota 90 2000

Citrus Fruit Florida 50 2001

Citrus Fruit Texas 86 2001

Citrus Trees Texas 50 2000

Cranberry Massachusetts 90 2000

Grapes Pennsylvania 86 2000

Grapes Washington 86 2000

Potatoes Idaho 90 2000

Potatoes Maine 90 2000

Potatoes Pennsylvania 90 2000

Rice Arkansas 90 2000

Rice Louisiana 90 2000

Rice Mississippi 90 2000

Stone Fruit California 90 2000

Walnut California 86 2000

* CEO is available in each county within the State for which actuarial documents for the crop and plan have been filed, beginning with the crop year shown above.

ACTION:

Insurance providers are to inform all agents eligible to sell CEO coverage of its availability, terms, and conditions.

DISPOSAL:

This informational memorandum is for the purpose of transmitting information and the expiration date is December 31, 1999.