Some farmers purchased Margin Protection last September as crop prices were above $5 for corn with a concern of increasing input costs. As time has passed through fall and winter, crop prices have continued to rise. Now we are looking at purchasing our crop insurance for the 2022 season and ECO is one of those options. If you elected Margin Protection last fall, you can’t elect ECO for the 2022 season.

Margin Protection and ECO have many similarities, that is why you can’t purchase both. But they also have coverage differences. You can review my blog post, ECO vs. MP, for a highlight list.

Is Margin Protection still a good choice since crop prices have continued to increase?

Here are a few reasons why MP continues to be an attractive option:

Amongst the list of differences between MP and ECO, you will notice that MP provides full 95% liability coverage. ECO provides a 9% band of coverage from 95% to 86%. Therefore, MP offers more coverage than ECO. If the Harvest Price would fall considerably or the county produces low yield, the ECO would max out at 9% where the MP would continue to pay only to be offset by your individual Revenue Protection policy. If you out produce the county, this would be to your advantage.

Also, MP provides coverage against increased input costs. See my blog post, Margin Protection Input Tracking, for an update on how the variable cost are tracking today.

Locking in protection to cover expenses is key for risk management. Margin Protection provides that high level protection.