USDA updates livestock and dairy insurance programs for 2027
The U.S. Department of Agriculture’s Risk Management Agency announced updates to the Livestock Risk Protection, Livestock Gross Margin and Dairy Revenue Protection insurance programs beginning with the 2027 crop year.
The changes were approved by the Federal Crop Insurance Corporation board of directors and are intended to expand coverage options, revise eligibility definitions and align policy language across livestock insurance programs.
General changes
Uniform updates across the three programs include adding subsidy capture language addressing off-exchange contracts, revising definitions and subsidy percentages for beginning farmers and ranchers to align with the One Big Beautiful Bill Act and allowing concurrent coverage between similar livestock programs.
Other changes include permitting cancellation of policies that have not earned a premium for three consecutive years, revising transfer-of-coverage language and updating policy language for consistency with other RMA insurance products.
“These updates expand coverage options, update eligibility definitions and strengthen program consistency across RMA’s livestock portfolio,” RMA Administrator Pat Swanson said in a statement. “We want to ensure that livestock and dairy operations across the country have the best tools available to manage risk.”
Livestock Risk Protection
LRP provides coverage against declining market prices for livestock producers, with coverage levels ranging from 75% to 100% of expected ending values.
Changes to the LRP program include expanded forage disaster exemption guidelines for extended drought and other natural disasters, including specified grazing dates when exemptions may apply.
The agency also increased the maximum weight threshold for fed cattle types and extended cull cow coverage to a maximum of 52 weeks.
Three new feeder cattle types also were added: unborn bulls and heifers weight 2, unborn Brahman weight 2 and unborn dairy weight 2. The new categories cover livestock in the 6.0- to 9.0-hundredweight range.
Livestock Gross Margin
LGM insurance protects cattle, dairy and swine producers from declines in gross margin, calculated as the market value of livestock or milk minus input costs.
Under the updated LGM program, the maximum insurable weight for cattle increased to 1,800 pounds.
The definition of target feeder cattle weight also was revised, increasing the maximum allowed target weight from 9 hundredweight to 12 hundredweight for yearling finishing operations.
The updated rules specify the difference between target live cattle weight and target feeder cattle weight cannot exceed 6 hundredweight for yearling finishing operations and 10 hundredweight for calf finishing operations.
RMA also modified the definition of “share” for LGM Cattle, requiring producers to own calves for at least five months for yearling finishing operations or eight months for calf finishing operations.
In addition, the agency increased the maximum target live cattle weight from 15 hundredweight to 18 hundredweight for yearling finishing operations and from 13 hundredweight to 16 hundredweight for calf finishing operations.
Dairy Risk Protection
For dairy producers, DRP provides protection against declines in milk revenue on a quarterly basis using futures prices and covered milk production levels selected by producers.
The update to DRP moves the sales period end date to the following calendar day, making the program consistent with sales period structures used in other livestock insurance programs. The LRP, LGM and DRP programs are available in all states and counties.
Lacey Vilhauer can be reached at 620-227-1871 or [email protected].
