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What is PRF
The Pasture, Rangeland, and Forage (PRF) Program is a federally backed risk management tool administered by the Risk Management Agency (RMA). It helps protect over 588 million acres of pasture and rangeland, plus 61.5 million acres of hayland across the U.S.—that’s over 55% of all U.S. land.
PRF is index-based, meaning coverage is triggered by deviations in rainfall—not individual loss reports. It uses a Rainfall Index (RI) to determine coverage eligibility, and is available across the continental 48 states.
How Does PRF Work?
PRF insures a specific amount of coverage per acre against lack of precipitation in the grid for a specific interval. The grid is roughly 17 miles north-south by 14 miles east-west (to be precise, it is a 0.25 degree square of latitude and longitude) that delineates the PRF coverage. Each grid will have its own historical indices and premium rating. All the land covered in a producer’s operation will fall into one or more grids.
The interval is a specific time period covered by the PRF policy and is a two-month interval. PRF coverage is divided among intervals to spread the coverage across the calendar year. The amount placed in any one interval is the interval percent. The interval percent can be no less than 10% and the maximum is dependent on the county as published by RMA in the actuarial documents. Insured intervals can’t overlap to include the same month. For example, you cannot have coverage in Mar-Apr and Apr-May since April overlaps the two intervals.
PRF Intervals:
Jan-Feb Feb-Mar Mar-Apr Apr-May May-Jun Jun-Jul
Jul-Aug Aug-Sep Sep-Oct Oct-Nov Nov-Dec
The amount of coverage per acre is based on separate published county base values(CBV) by RMA for two different intended uses - haying and grazing. A producer selects a coverage level from 70% - 90%, in 5% increments. This coverage level can be chosen differently for haying and grazing acreage. The coverage level determines the percentage of the CBV to be covered as well as the trigger for the rainfall index. For example, a 75% coverage level will cover 75% of the CBV and would trigger an indemnity if the rainfall index was below 75% of the historical average for that interval. A 90% coverage level premium is higher than a 75% coverage level premium since it will trigger an indemnity more often.
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A producer also chooses a productivity factor from 60% to 150% to help refine the coverage amount and premium. The productivity factor can be different for haying and grazing acreages.
Coverage Per Acre = County Base Value x Coverage Level x Productivity Factor
How Much Am I Insuring?
How A Loss Is Calculated
Each interval stands on its own when calculating a loss. A loss is triggered by an interval having a current index below the specified coverage level. The current index reflects how much precipitation was received compared to the long-term average for the specific grid and interval.
Once that happens, the loss is calculated as follows:
Indemnity = [(Coverage Level – Current Index) / Coverage Level] x Coverage Per Acre x Interval Percent
Do I Have To Insure All of the PRF Acres?
No. PRF allows the producer to develop a custom-designed risk management portfolio for haying and grazing acres. The producer chooses which acreage to cover when signing the application and acreage report form. This form is due December 1 before the coverage year begins in January.
Why SCIS For Your
PRF Coverage?
SCIS has developed proprietary tools to help analyze each grid and calculate optimum interval selection based on your desired premium level and coverage preferences. Check out this video for an introduction to PRF and this video that goes in-depth on our tools. We truly believe that service is the difference.