Multi Peril Crop Insurance, often referred to as MPCI, is the backbone of the federal crop insurance program and remains the most widely used risk management tool among U.S. farmers. Established in 1938, the program has evolved significantly to improve participation and effectiveness. Recent increases in premium subsidies have shifted the conversation around how to best integrate MPCI into a producer’s broader marketing strategy. Similar to the ways in which Livestock Risk Protection and Dairy Revenue Protection reshaped coverage opportunities in the livestock and dairy sectors, new enhancements now allow crop producers to evaluate more cost-effective, subsidized revenue protection options—providing coverage closer to the market than ever before.

Background

MPCI policies insure against losses caused by a wide range of natural events, including excess precipitation, drought, insect damage, plant disease, hail, wind, flooding, frost, wildlife, tornado and fire. Losses can be caused by one or any combination to qualify. Losses may result from a single peril or multiple events that collectively reduce yield. In addition, most MPCI products include price protection, ensuring producers are covered if market values decline between planting and harvest. Sales closing dates vary by crop, with most spring-planted crops due by March 15 and fall-planted crops by September 30.

Producers customize their MPCI coverage through several key elections:

  • Product Choice growers select the type of MPCI policy that fits their operation, such as Revenue Protection (RP), Revenue Protection with Harvest Price Exclusion (RP-HPE), Yield Protection (YP), or area-based products. Each option balances yield and price risk differently, with most U.S. acres covered under RP and YP.

  • Coverage Level: producers choose how much of their expected yield or revenue they want to insure. Higher coverage levels provide more protection but require higher premiums, a tradeoff best evaluated with an experienced crop insurance agent.

  • Unit Structure: unit selection—whether basic, optional, or enterprise units—affects how losses are grouped and measured. This choice influences both premium cost and the likelihood of triggering a claim.

  • Endorsements: endorsements such as the Supplemental Coverage Option (SCO), Enhanced Coverage Option (ECO), and quality adjustment options allow producers to tailor MPCI to their specific risk exposures or marketing strategies.

  • Private Products: beyond federal programs, private add-ons (add-on hail, wind, replant, and more) offer supplemental protection to close gaps and cover exclusions in standard MPCI coverage.

Understanding a farm’s yield relationships compared to the county, along with projected profit margins and profitability targets, is essential when making program elections.

Recent MPCI Changes

While the safety net continues to evolve, recent changes to ECO, in particular, have created new opportunities for producers. The ECO endorsement, introduced in Crop Year 2021, provides county-based coverage for a portion of the farm’s expected revenue. ECO offers insureds a choice of 90 percent or 95 percent trigger levels. The ECO endorsement begins to pay when county yield or revenue falls below 95 percent (or 90 percent, if that is the trigger level elected). The full amount of the ECO coverage is paid out when the county average revenue falls to 86 percent of the farm’s expected revenue.

Beginning in Crop Year 2026, the ECO subsidy increases to 80 percent, a substantial increase and major advantage for producers seeking to bring their coverage floor closer to the market. This subsidy increase allows producers to make more market-based enhancements to their protection throughout the growing season with futures and options, ensuring no opportunities are left on the table. Similar subsidy increases have recently been implemented for SCO. Base subsidy rates for RP policies are also set to increase 3 to 5 percent depending on coverage level. Producers who haven’t evaluated their structure recently may benefit from doing so now.

Leveraging Your Decision

The role of crop insurance has transformed dramatically over the past decade. What was once a financial backstop for a bad year has become a central component of a farmer’s financial and marketing plan. If a producer is not treating their policy as a dynamic tool, it may be time to reexamine their approach.

At CIH, we help producers maximize the value of their MPCI coverage through a clear, data-driven approach. We analyze policies using years of historical price and yield data, modeling how different structures would have performed under past conditions to identify the most cost-effective, risk-appropriate options. Throughout the growing season, we update real-time indemnity estimates as weather, markets, and crop conditions change, giving producers continual insight into revenue risk and supporting timely, opportunity-driven decisions.

MPCI works even more effectively when paired with exchange-traded instruments. Just as livestock producers have successfully rolled up coverage after rallies or protected indemnities during market breaks, we help producers structure hedges that complement their insurance policy.

CIH views MPCI not as a standalone purchase, but as one component of a comprehensive risk management framework. Through our tailored online platform and mobile app, producers access policy details, indemnity estimates, market data, analytics, and scenario tools anytime from any device to provide a complete view of risk in one place. As such, clients have the ability to make timely, confident decisions. Contact the CIH Crop Insurance Team today for a personalized demonstration of our new MPCI analysis tools and learn how to fully harness opportunities surrounding MPCI.