An exciting new crop insurance option for cotton growers across the U.S. in 2011 is the Cottonseed (Pilot) Endorsement, an optional endorsement that growers can use to insure the cottonseed as well as their cotton lint.

To purchase coverage under the Cottonseed Endorsement a grower (Upland or Extra Long Staple) must purchase a qualifying buy-up policy of insurance (Yield or Revenue) under the new Combo plan provisions for cotton. The endorsement will not be available to growers who purchase CAT, GRIP or GRP cotton policies.

Under the endorsement, cottonseed is insured against yield losses that might occur during the growing season. There is no revenue component attached to the Cottonseed Endorsement.

Yield coverage is established using the grower's approved APH (actual production history) cotton lint yield, a national cottonseed price (which has been set by USDA RMA at $0.09 per pound, or $180 per ton, for the 2011 growing season) and the same level of coverage that applies to their cotton lint policy.

Premiums for the Cottonseed Endorsement will be calculated using the coverage level of the grower's lint policy, the national cottonseed price and the premium rate applicable to the grower’s approved lint yield for Yield protection coverage under USDA RMA's Combo plan provisions. Growers purchasing Revenue protection on their cotton lint will also have their Cottonseed Endorsement premium calculated based on the rate applicable to Yield only coverage at their approved APH yield level.

Premiums applicable to the Cottonseed Endorsement will qualify for the same level of federal premium subsidy as the producer’s underlying cotton lint policy.

For additional information about the Combo plan or the Cottonseed (Pilot) Endorsement producers are encouraged to contact their insurance agent or crop insurance provider to learn how the new provisions and the Cottonseed Endorsement will affect their 2011 risk management decisions.