Insurability conditions and livestock disease insurance.

The Agricultural Risk Protection Act (ARPA) enacted in June 2000 mandated that the US Department of Agriculture’s (USDA) Risk Management Agency (RMA) conduct pilot programmes on risk management tools that would protect livestock producers from price or income fluctuations and production losses. The legislation also authorized RMA to conduct pilot programmes on risk management products for livestock disease perils and various risks faced by aquaculture producers. To date, RMA has approved two pilot livestock insurance policies: a Livestock Risk Protection (LRP) policy that protects against declining prices for swine, feeder cattle and fed cattle, and a Livestock Gross Margin (LGM) policy that protects the gross margin between the price of fed hogs and the cost of maize and soybean meal. Both products are available only in selected areas. RMA has also funded studies on the feasibility of aquaculture insurance, risk management alternatives for livestock disease risk, non-insurance livestock risk management tools and tools for managing pasture/range and forage production risk.