South Dakota Crop Insurance Practice Exam

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Prepare for the South Dakota Crop Insurance Exam. Study smart with flashcards and multiple choice questions; all questions feature hints and detailed explanations. Ace your exam effortlessly!

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What percentage does the CAT Coverage endorsement of YP pay?

45% of the price of the commodity
50% of the price of the commodity
55% of the price of the commodity
60% of the price of the commodity

The correct answer is: 55% of the price of the commodity

The CAT Coverage endorsement, which stands for Catastrophic Risk Protection, provides a safety net for producers by covering a specific percentage of the price of the commodity in the event of a loss. Under the provisions of CAT coverage, farmers receive coverage for 55% of the expected market price of their crop. This level of coverage is designed to offer basic protection to producers facing catastrophic losses while keeping premiums low and accessible. In the context of crop insurance, CAT coverage is typically an important option for farmers, particularly those with limited resources seeking cost-effective insurance solutions. It serves as a baseline protection option, focusing on ensuring that producers do not experience total loss without any safety measures in place.