[Federal Register: December 31, 2008 (Volume 73, Number 251)]
[Rules and Regulations]
[Page 80295]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr31de08-1]
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Rules and Regulations
Federal Register
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[[Page 80295]]
DEPARTMENT OF AGRICULTURE
Federal Crop Insurance Corporation
7 CFR Part 457
RIN 0563-AC15
Common Crop Insurance Regulations, Coverage Enhancement Option
Provisions; Corrections
AGENCY: Federal Crop Insurance Corporation, USDA.
ACTION: Final rule; corrections.
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SUMMARY: This document contains corrections to the final regulation
that was published Monday, July 28, 2008 (73 FR 43607-43611). The
regulation pertains to the Coverage Enhancement Option.
DATES: Effective Date: December 31, 2008.
FOR FURTHER INFORMATION CONTACT: Bill Klein, Risk Management
Specialist, Product Management, Product Administration and Standards
Division, Risk Management Agency, United States Department of
Agriculture, Beacon Facility--Mail Stop 0812, PO Box 419205, Kansas
City, MO 64141-6205, telephone (816) 926-7730.
SUPPLEMENTARY INFORMATION:
Background
The final regulation that is the subject of these corrections was
intended to make permanent the Pilot Coverage Enhancement Option
Provisions to be used in conjunction with the Common Crop Insurance
Policy Basic Provisions and selected crop policies for ease of use and
consistency of terms.
Need for Corrections
As published, the final regulation contained an error that may
prove to be misleading and needs to be clarified.
The term ``total value of the insured crop'' defined in section 1
of the Coverage Enhancement Option is incorrect and should read ``total
value of the insured crop by unit.'' The term ``total value of the
insured crop by unit'' has replaced the term ``total value of the
insured crop'' everywhere it appears in the Coverage Enhancement
Option. This includes in the definition of the term ``CEO dollar amount
of insurance,'' section 7, section 8(b) and paragraphs (b) and (c) in
the example. This change ensures liability and indemnity determinations
are on the same basis.
Also, in the definition of ``Total value of the insured crop by
unit'' in section 1, the phrase ``and summing the total for all
units,'' should be removed. This language could give the impression
that when multiple units are involved, the value of all units should be
added together. However, section 8 and the example are calculated on a
unit basis so that bringing the value of other units into the
calculation would result in an incorrect indemnity.
Crop Insurance, Coverage Enhancement Option
Correction of Publication
0
Accordingly, the 7 CFR part 457 is corrected as follows:
PART 457--COMMON CROP INSURANCE REGULATIONS
0
1. The authority citation for 7 CFR part 457 is revised to read as
follows:
Authority: 7 U.S.C. 1506(l) and 1506(o).
0
2. Sec. 457.172 is amended by revising in section 1 the definitions of
``CEO dollar amount of insurance,'' ``total value of the insured
crop,'' section 7, section 8(b), and paragraphs (b) and (c) of the
Example to read as follows:
Sec. 457.172 Coverage Enhancement Option.
* * * * *
1. Definitions.
* * * * *
CEO dollar amount of insurance--The value of the additional
insurance coverage for each unit provided by the CEO, which is
determined by multiplying the CEO coverage level by the total value of
the insured crop by unit and subtracting the MPCI dollar amount of
insurance.
* * * * *
Total value of the insured crop by unit--The value of the crop that
is determined by dividing the MPCI dollar amount of insurance for each
unit by the MPCI coverage level.
* * * * *
7. If you elect CEO and a MPCI indemnity is paid on any unit, CEO
will pay a portion of the loss not paid under the deductible of the
MPCI policy depending on the CEO coverage level you select (For
example, if you selected a 50 percent MPCI coverage level, selected an
85 percent CEO coverage level, and had 60 percent loss of the insured
crop, the total amount of indemnity paid under both the MPCI policy and
the CEO would be equal to approximately 51 percent of the total value
of the insured crop by unit). See the example in section 8.
* * * * *
8. * * *
* * * * *
(b) Determine the total value of the insured crop by unit;
* * * * *
Example:
* * * * *
(b) $120,000 MPCI dollar amount of insurance, divided by the MPCI
coverage level of .50 results in $240,000 total value of the insured
crop by unit;
(c) $240,000 total value of the insured crop by unit multiplied by
the CEO coverage level .85, equals $204,000, and subtracting $120,000
MPCI dollar amount of insurance equals $84,000 CEO dollar amount of
insurance;
* * * * *
Signed in Washington, DC, on December 23, 2008.
Eldon Gould,
Manager, Federal Crop Insurance Corporation.
[FR Doc. E8-31105 Filed 12-30-08; 8:45 am]
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