Subject: The Raisin Crop Insurance
Provisions, 7 C.F.R. § 457.124, subparts 9 and 10.
On February 8, 2001, the Risk Management Agency was asked for
a final agency determination concerning the Raisin Crop Insurance
Provisions for the 2000 crop year. Section 9 states:
- In lieu of the provisions of section 11 (Insurance Period)
of the Basic Provisions (§ 457.8), insurance attaches on
each unit at the time the raisins are placed on trays for drying
and ends at the earlier of:
- (a) October 20;
(b) The date the raisins are removed from the trays;
(c) The date the raisins are removed from the vineyard;
(d) Total destruction of al raisins on the unit;
(e) Final adjustment of a loss on a unit; or
(f) Abandonment of the raisins.
Section 10(a) states:
In accordance with the provisions of section 12 (Causes of
Loss) of the Basic Provisions (§ 457.8), insurance is provided
only against unavoidable loss of production resulting from rain
that occurs during the insurance period and while the raisins
are on are trays or in rolls in the vineyard for drying.
Final Agency Determination
If an insured is unable to pick up the raisin crop due to
wet conditions caused by rain during the insurance period and
the crop is subsequently damaged by rains occurring after the
end of the insurance period, the damage caused by the rains occurring
after the insurance period is an "unavoidable loss of production,"
which is an insurable cause of loss under 7 C.F.R. § 457.124.
Damage to the raisins that results from the insured cause of
loss, rain, that occurred after the insurance period may be insurable
provided that there is evidence that:
(1) Rains damaged the raisins during the insurance period;
(2) As a result of the rain that occurred during the insurance
period, it was not possible to box and remove the raisins before
the end of the insurance period;
(3) Rains occurred after the insurance period that caused further
damage to the raisins; and
(4) As a result of the rain that occurred during or after the
insurance period, it was not possible to box and remove the raisins
at any time between the end of the insurance period and the subsequent
rains that caused the additional damage.
If the inability to box and remove the raisins is caused by
anything other than rain, neither the original loss nor the subsequent
loss is insurable. If the subsequent damage to the raisins is
caused by anything other than rain, the additional loss is not
insurable. Therefore, reinsured companies must verify the cause
of loss and determine the extent of damage at the end of the insurance
In accordance with 7 C.F.R. § 400.765(c), this constitutes
a final agency determination and is binding on all participants
in the Federal crop insurance program.
Date of Issue: May 9, 2001