* Act of February 16, 1938 (P.L. 75-430, Ch. 30, 52 Stat. 31; 7 U.S.C. 1502, 1503, 1508, 1518)

Sec. 502. It is the purpose of this chapter to promote the national welfare by improving the economic stability of agriculture through a sound system of crop insurance and providing the means for the research and experience helpful in devising and establishing such insurance. (7 U.S.C. 1502)

Federal Crop Insurance Corpora-tion

Sec. 503. To carry out the pur-poses of this chapter, there is hereby created as an agency of and within the Department of Agriculture a body corporate with the name "Fed-eral Crop Insurance Corporation" (herein called the Corporation). The principal office of the Corporation shall be located in the District of Columbia, but there may be estab-lished agencies or branch offices elsewhere in the United States under rules and regulations prescribed by the Board of Directors. (7 U.S.C. 1503)

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Crop Insurance

Sec. 508. (a) Authority to offer insurance.-If sufficient actuarial data are available, as determined by the Board, the Corporation may insure producers of agricultural commodities grown in the United States under any plan or plans of insurance determined by the Board to be adapted to the agricultural commodity involved. Such insur-ance shall be against loss of the insured commodity due to unavoidable causes, including drought, flood, hail, wind, frost, winterkill, lightning, fires, excessive rain, snow, wildlife, hurricane, tornado, insect infestation, plant disease, and such other unavoidable causes as may be determined by the Board. Except in the case of tobacco, insur-ance shall not extend beyond the period the insured commodity is in the field. For the purpose of the foregoing sentence, in the case of aquacultural species, the term "field" means the environment in which the commodity is produced. Any insur-ance offered against loss in yield shall make available to producers protection against loss in yield that covers 75 per centum of the record-ed or appraised average yield of the commodity on the insured farm for a representative period (subject to such adjustment as the Board may pre-scribe to the end that the average yields fixed for farms in the same area, which are subject to the same conditions, may be fair and just). In addition, the Corporation shall make available to producers lesser levels of yield coverage, including a level of coverage at 50 per centum of the recorded or appraised average yield, as adjusted. For any commodity for which the Agricultural Stabiliza-tion and Conservation Service has established for the farming unit involved an adjusted yield for the purposes of programs administered by such Service (or a yield for crop insurance purposes under the provi-sions of this chapter), and such yield is greater than the recorded or the appraised yield, as established by the Corporation, of a commodity on such farming unit, insurance cover-age may be provided to cover against the loss in yield of the commodity on the basis of the adjusted yield for the commodity established by the Agricultural Stabilization and Conservation Service rather than the recorded or appraised yield as estab-lished by the Corporation. Such additional insurance shall be provid-ed for an additional premium (for which no premium subsidy or ad-ministrative subsidy may be provid-ed) set at such rate as the Board determines appropriate to reflect accurately the increased risk in-volved and that the Board deter-mines actuarially sufficient to cover claims for losses on such insurance and to establish a reasonable reserve against unforeseen losses. Except as provided in the preceding two sen-tences, the Corporation shall not make available to producers any level of coverage in excess of 75 per centum of the recorded or ap-praised average yield, as adjusted. One of the price elections offered shall approximate (but be not less than 90 per centum of) the projected market price for the commodity involved, as determined by the Board. Insurance provided under this subsection shall not cover losses due to the neglect or malfeasance of the producer, or to the failure of the producer to reseed to the same crop in areas and under circumstances where it is customary to so reseed, or to the failure of the producer to follow established good farming practices. The Board may limit or refuse insurance in any county or area, or on any farm, on the basis of the insurance risk involved. Insurance shall not be provided on any agricultural commodity in any county in which the Board determines that the income from such commodity constitutes an unimportant part of the total agricultural income of the county, except that insurance may be provided for producers on farms situated in a local producing area bordering on a county with a crop-insurance program. The Corporation shall report annually to the congress the results of its operations as to each commodity insured. Beginning with the 1992 crop year, the Corporation shall establish a price level for each commodity on which insurance is offered that shall not be less than the projected mar-ket price for the commodity as determined by the Board. Insurance coverage shall be made available to the producer on the basis of any price election which equals or is less than that established by the Board and the coverage shall be quoted in terms of dollars per acre.

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(i) The Corporation may provide insurance or reinsurance for produc-tion of agricultural commodities in the Commonwealth of Puerto Rico, the Virgin Islands of the United States, Guam, American Samoa, the Common-wealth of the Northern Mariana Islands, and the Trust Ter-ritory for the Pacific Islands in the same manner as provided in this section for production of agricultural commodities in the United States.

(j) The Corporation offer specific risk protection programs including, but not limited to, prevented plant-ing, wildlife depredation, tree dam-age and disease, and insect infesta-tion programs under such terms and conditions as the Board may deter-mine: Provided, That no program may be undertaken if insurance for the specific risk involved is generally available from private companies.

Sec. 518. Agricultural com-mod-ity.-"Agricultural commodity", as used in this title, means wheat, cotton, flax, corn, dry beans, oats, barley, rye, tobacco, rice, peanuts, soybeans, sugar beets, sugar cane, tomatoes, grain sorghum, sunflow-ers, raisins, oranges, sweet corn, dry peas, freezing and canning peas, forage, apples, grapes, potatoes, timber and forests, nursery crops, citrus, and other fruits and vegeta-bles, nuts, tame hay, native grass, aquacultural species (including, but not limited to, any species of fin-fish, mollusk, crustacean, or other aquatic invertebrate, amphibian, reptile, or aquatic plant propagated or reared in a controlled or selected environment), or any other agricul-tural commodity, excluding live-stock and stored grain, determined by the Board under subsection (a) or (i) of section 508 of this title, or any one or more of such commodities, as the context may indicate. (7 U.S.C. 1518)