North Dakota Crop Insurance Practice Test

Question: 1 / 400

What defines a "threshold yield" in revenue protection insurance?

The maximum yield that qualifies for payout

The minimum yield that triggers a payout for revenue losses

A “threshold yield” in revenue protection insurance is defined as the minimum yield that triggers a payout for revenue losses. This concept is integral to how revenue protection insurance operates, as it establishes a baseline yield level below which the farmer will receive compensation due to the shortfall caused by various perils affecting crop production.

When the actual yield falls below this threshold, it indicates that the farmer has experienced a loss significant enough to warrant an insurance payout. This mechanism helps farmers mitigate their risk by providing financial support during adverse conditions that could adversely impact their income.

Understanding this threshold is crucial for farmers when assessing their insurance policy, as it directly affects their financial planning and the decisions they make regarding crop management and potential coverage options.

Get further explanation with Examzify DeepDiveBeta

The average yield expected for a specific crop

The yield that guarantees full premium reimbursement

Next Question

Report this question

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy