Introduction
Drought is no stranger to ranchers in the western U.S. In fact, USDA reports estimate that drought causes over $6 billion in agricultural losses each year. When rain doesn’t fall, pastures dry out, forage yields drop, and ranchers feel the financial squeeze almost immediately.
For operations that rely on grazing, a dry year doesn’t just mean tight margins; it threatens the stability of the entire ranch. If rainfall comes up short, feed costs rise, herd sizes must shrink, and long-term plans like succession or expansion get delayed.
That’s where Pasture, Rangeland, and Forage (PRF) insurance comes in. PRF insurance is a federal program designed to help ranchers weather those dry years by providing indemnity checks when rainfall comes up short of historical averages. It’s backed by the USDA and built to protect your operation when nature doesn’t cooperate. If you’ve never used it before, this guide will walk you through everything you need to know.
What is PRF Insurance?
PRF insurance is a federal crop insurance program administered by the USDA’s Risk Management Agency (RMA). While most crop insurance protects row crops like corn and wheat, PRF insurance was created specifically for ranchers whose operations depend on pasture and hay ground.
In simple terms, PRF insurance protects you financially when rainfall on your insured land falls below the long-term average for your area. You don’t need to prove damaged pasture or reduced forage; NOAA rainfall data determines if an indemnity check is triggered.
Every piece of land in the U.S. is mapped into grids roughly 13x17 miles in size, and your ranch’s location determines which grid your coverage applies to. The program uses 70 years of historical rainfall data to calculate an average, and you pick a coverage level between 70% and 90% of that historical average.
If rainfall during your selected time periods — called intervals — is lower than your chosen coverage level, you may receive an indemnity check. It’s a straightforward, no-claims process that can give you relief during dry spells.
How PRF Insurance Works
The Grid System
When you enroll in PRF insurance, your land is mapped and our expert agents can see the NOAA-defined grids your operation falls into. Each grid is independent, and rainfall is tracked using at least four of the closest NOAA weather stations.
Coverage Levels
You can insure between 70% and 90% of your area’s historical average rainfall. Higher coverage levels give you a higher chance of receiving an indemnity check when drought occurs, but also result in a higher premium.
Rainfall Measurement & Indemnity Check Triggers
Rainfall is measured during two-month periods called intervals (e.g., Jan-Feb, Feb-Mar). You can’t overlap intervals, but you can spread your coverage across different periods based on historical rainfall data.
If rainfall in your grid during an interval falls below your chosen coverage level, that triggers a loss (or indemnity check) for that interval. Once your total indemnities, the payment credited to your policy when rainfall underperforms, exceed your policy premium, additional indemnity checks go directly to you.
Self-Funding Mechanism
PRF insurance is designed to be self-funding: your premium is automatically paid out of your indemnity checks first. If your policy performs well (i.e., it triggers indemnities during dry intervals), you may owe nothing out of pocket. But if there aren’t enough dry intervals to generate indemnities, you pay the remaining premium toward the end of the policy year. You don’t have to pay your premium all at once. Most insurance providers let you break it into smaller payments over time.
Payment Timeline
NOAA releases rainfall data 60-90 days after each interval ends. If an indemnity is due, the payment process is automatic; no claims to file, no adjusters to call. Indemnity checks are issued shortly after rainfall data is released.
Who Qualifies for PRF Insurance?
Eligibility Requirements
PRF insurance is open to all ranchers who use acreage for grazing or hay production. Whether you own or lease the land, you can insure it as long as it is intended for livestock forage.
Land Ownership vs. Lease
You don’t have to own the land you insure. Leased acreage can also be covered, as long as you can show that you have a financial stake in its productivity.
Acreage Minimums and Maximums
Minimum acreage requirements vary by county, but typically any operation with more than 60 acres qualifies. Check with our PRF experts to see if your operation qualifies.
PRF Insurance Benefits
USDA Subsidies
The USDA helps keep premiums affordable by subsidizing 51%-59% of your premium, depending on your chosen coverage level.
Customizable Coverage Periods
You control how your policy is structured, selecting the intervals and grids that match your ranch’s unique historical rainfall patterns and volatility.
Works With Other Programs
PRF is compatible with other USDA programs like the Noninsured Disaster Assistance Program (NAP) or supplemental disaster relief. It can be a powerful tool alongside other risk management strategies.
Cash Flow Protection
When forage is short, cattle feed costs climb fast. PRF indemnity checks can help keep your operation steady during drought, making it easier to manage feed bills, herd size, and long-term ranch plans.
Getting Started with PRF Insurance
Application Process & Deadlines
Enrollment for PRF policies closes annually on December 1. To get started, contact an approved insurance agent who specializes in PRF.
Required Documentation
For an application, you’ll need to provide:
- Acreage details
- Substantial Beneficial Interest (SBI) details for any party with 10%+ financial interest
Working With Approved Agents
PRF coverage performs best when your agent customizes it to your operation using detailed rainfall history and grid analysis. At Redd Summit Advisors, we can analyze billions of possible policy combinations to optimize your coverage for your operation.
Complementary Risk Management
PRF insurance can work alongside:
- Livestock Risk Protection (LRP)
- Farm Service Agency programs
- Disaster relief programs
It’s an additional layer of financial stability when forage productivity is at risk.
Conclusion
PRF insurance gives ranchers a simple, proven way to reduce the financial impact of drought. By aligning coverage with your operation’s rainfall history, PRF helps protect your bottom line and keep you and your operation on your land, even during dry years.
Deadlines matter: December 1 is the cutoff for new or updated policies each year. Don’t wait until drought threatens your pasture; now’s the time to act.
Request your free PRF policy preview today. A short conversation and a look at your land’s history can help you see if your current policy is working as well as it could, or if you’re leaving money on the table.
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