Livestock Insurance

Livestock Gross Margin (LGM)

LGM Dairy
The Livestock Gross Margin for Dairy Cattle Insurance Policy provides protection against the loss of gross margin (market value of milk minus feed costs) on the milk produced from dairy cows

LGM for Cattle
LGM provides protection against loss of gross margin (market value of cattle minus feeder cattle and feed costs) on cattle. LGM covers a decline in cattle prices and/or an increase in feed costs and/or an increase in feeder cattle prices.

LGM for Hogs
LGM provides protection for the gross margin between the value of insured hogs and the cost of corn and soybean meal. It covers a decline in hog prices and/or an increase in feed costs.

Livestock Risk Protection (LRP)

LRP covers a decline in livestock prices. Coverage prices range from 70-100% of daily livestock prices for swine, fed cattle, and feeder cattle; and 80-95% in 5% increments for lamb. LRP is priced and available for sale continuously throughout the year.

What are the benefits of LRP?

• Guaranteed Price.
• No Bid / Ask spread.
• Limited Basis Risk Coverage.
• Aggregate cash price used better reflects actual price received.
• Any number of head can be covered (up to limits).
• Producer selects the period that fits their risk management plan.
• Wider range of Target Weights than CME.
• May be viewed more favorably by lenders than hedging or speculating (derivative products).
• Subsidized by government

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FAQ 

What type of livestock insurance do you offer? 

We offer two types of livestock insurance: Livestock Gross Margin (LGM) and Livestock Risk Protection (LRP). Risk Protection guarantees against a loss in price, and Gross Margin guarantees against a loss in the gross margin between the price of livestock and the feed costs. 

Does the Livestock Gross Margin or Livestock Risk Protection use the price the producer actually receives at the market? 

No. It’s based on averages from settlement prices on the market. The prices are based on simple prices. 

Do LGM and LRP have a producer subsidy? 

Yes. It just depends on the product chosen. For instance, on LGM, if you have a zero deductible, you get an 18% subsidy, but If you have a $70 deductible, it would be a 50% subsidy. It might seem complicated, but just give us a call and we can walk you through and make the process very simple. 

What kind of livestock do you insure? 

We currently offer cattle insurance and swine insurance. 

Can unborn livestock be insured? 

Yes, they can. Give us a call and we’ll walk through a policy with you to make sure your legacy animals are safe. 

How long do I have to keep my livestock insured? 

The specific length of time you need to insure your livestock for is called an “endorsement length.” That’s anywhere from 13 weeks to 52 weeks, depending on the livestock. It can be chosen by the producer (aka the farmer). 

Can some farmers receive more on subsidies? 

Yes. Beginning farmers and ranchers get an extra 10 % subsidy. Military veterans also get a 10% subsidy.

FAQ 

What type of livestock insurance do you offer? 

We offer two types of livestock insurance: Livestock Gross Margin (LGM) and Livestock Risk Protection (LRP). Risk Protection guarantees against a loss in price, and Gross Margin guarantees against a loss in the gross margin between the price of livestock and the feed costs. 

Does the Livestock Gross Margin or Livestock Risk Protection use the price the producer actually receives at the market? 

No. It’s based on averages from settlement prices on the market. The prices are based on simple prices. 

Do LGM and LRP have a producer subsidy? 

Yes. It just depends on the product chosen. For instance, on LGM, if you have a zero deductible, you get an 18% subsidy, but If you have a $70 deductible, it would be a 50% subsidy. It might seem complicated, but just give us a call and we can walk you through and make the process very simple. 

What kind of livestock do you insure? 

We currently offer cattle insurance and swine insurance. 

Can unborn livestock be insured? 

Yes, they can. Give us a call and we’ll walk through a policy with you to make sure your legacy animals are safe. 

How long do I have to keep my livestock insured? 

The specific length of time you need to insure your livestock for is called an “endorsement length.” That’s anywhere from 13 weeks to 52 weeks, depending on the livestock. It can be chosen by the producer (aka the farmer). 

Can some farmers receive more on subsidies? 

Yes. Beginning farmers and ranchers get an extra 10 % subsidy. Military veterans also get a 10% subsidy.

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