What does Actual Production History (APH) insurance protect against?

Actual Production History (APH) insurance is designed to protect farmers against yield losses that result from naturally occurring events. These events can include adverse weather conditions such as drought, excessive rainfall, frost, hail damage, and other environmental factors that impact crop production. By utilizing APH insurance, farmers can receive compensation that reflects their historical yield patterns, safeguarding them from the financial burden of crop losses due to these unpredictable and unavoidable natural occurrences.

This form of insurance focuses specifically on the physical production of crops rather than external market factors, providing a safety net that helps maintain a farm's viability in the face of yield-reducing incidents. Thus, APH is vital for farmers who are affected by nature’s variability and need assurance that they will not suffer catastrophic losses without some financial recovery.