With its passage of the Agriculture Improvement Act of 2018, Congress authorized the Livestock Indemnity Program (LIP) to provide benefits to eligible livestock owners for livestock deaths in excess of normal mortality caused by eligible loss conditions.

Here are a few things interested farmers should know as they consider whether or not LIP coverage might benefit their operations.

How it works: LIP is administered by the USDA Farm Service Agency (FSA). Farmers should file notice with the FSA’s LIP within 30 days of their livestock losses. The notice of loss and the livestock owners’ application for payment needs to be filed at the local FSA office in the county in which the losses occurred.

The kinds of livestock eligible: Eligible livestock under LIP include cattle, poultry, swine, sheep, horses, goats and bison. The livestock must have either died in excess of normal mortality as a direct result of an eligible loss condition or been injured as a direct result of an eligible loss condition.

Eligible livestock are those that have been maintained for commercial use as part of a farming operation and do not include free-roaming animals, pets or animals used for recreational purposes such as hunting, show and roping.

The kinds of owners eligible for payouts: Both owners and contract growers are eligible, although the rules are somewhat different. To be eligible, the livestock owner must prove legal ownership of the covered animal on the day of its death and/or injury by an eligible loss condition.

Eligible events: Losses that fall under LIP coverage include those caused by adverse weather. This includes things like blizzards, hailstorms, lightning strikes, tornados, hurricanes, floods, wildfires, extreme heat/cold and earthquakes. Losses due to disease can also be eligible.

Coverage can also apply to losses caused by attacks by animals reintroduced into the wild by the federal government or protected by federal law, including wolves and avian predators.

Documentation matters: All losses must be thoroughly documented. Farmers must record the number and kind of livestock lost in the event. For livestock injured in an eligible event, and where an owner sold the animal/s for a reduced price, the owner must provide evidence of the reduced sale to an independent third party. Verifiable evidence can include receipts from a livestock auction, rendering facility or processing plant.

How vaccination affects claims: Livestock death losses due to extreme cold are eligible, regardless of vaccination status. Compensation for livestock death losses due to diseases caused or transmitted by a vector and not controlled by vaccination or an acceptable management practice is provided.

How much farmers can expect to receive: Payments are based on national rates and are about 75% of the market value of the livestock. For cattle, per-head payments vary but generally follow current guidelines: Bulls at $1,077, cows at $829, non-adult cattle under 400 pounds at $474.38, non-adult cattle between 400 and 799 pounds at $661 and non-adult cattle over 800 pounds at $1,102.

For more information visit fsa.usda.gov/programs-and-services/disaster-assistance-program/livestock-indemnity/index.

by Enrico Villamaino