The so-called “One Big Beautiful Act” (OBBA) that was passed by Congress in 2025 made some important changes to provisions that could affect 2026 farm program and crop insurance decisions. This includes the implementation of higher reference prices for all Title I crops beginning for the 2025 and 2026 crop years, improved farm program guarantees, and increased federal subsidies for crop insurance premiums. These enhancements have raised some questions for farmers as they analyze their options for 2026 crop insurance coverage, as well as with their choice of the PLC and ARC-CO farm program option. The crop insurance sign-up deadline is March 16. No sign-up dates have been announced for enrollment in the 2026 farm program.
 
Following are some of the farm program and crop insurance questions that have resulted from the implementation of the OBBA, as well as other common questions:

• How did the OBBA affect reference prices for 2025 and 2026 ?

The statutory reference prices were increased by 10 to 20 percent for all farm program crops beginning with the 2025 crop year, and continuing for the 2026 through 2031 crop years. The new statutory (minimum) reference prices are $4.10/bu. for corn, $10.00/bu. for soybeans, and $6.35/bu. for wheat. The “effective reference prices” are based on the 5-year “olympic” average (drop the high and low) market year average (MYA) price from five previous crop years times 85% (.85). The effective reference price can be as much as 15 percent above the statutory reference price. The
 

• How will the increased refence prices affect the benchmark (BM) prices that are used to determine guarantees for the ARC-CO program ?

The BM prices will continue to be calculated based on the 5-year “olympic” market year average (MYA) price for five previous years, with no factoring. The minimum BM prices for 2025-2031 will be $4.10/bu. for corn $10.00/bu. for soybeans, and $6.35/bu. for wheat. There will be no impact on the 2025 and 2026 BM prices due to the calculated BM prices exceeding the “effective” reference prices. The 2025 and 2026 BM prices are $5.03/bu. for corn, $12.17/bu. for soybeans, and $6.98/bu. for wheat. 
 

• What are the changes in the OBBA that will be used for calculation of ARC-CO payments ?

The ARC-CO guarantee level is increased to 90 percent of the calculated benchmark (BM) revenue (BM county yield x BM price), which is up from the previous 86 percent guarantee. The maximum ARC-CO payment cap is increased to 12 percent of the calculated BM revenue, which was previously at 10 percent. This combination means that ARC-CO payments will be initiated more frequently, and the maximum ARC-CO payment amounts per base acre will be significantly higher for most program crops.
 

• What are the new farm program payment limits under the OBBA ?

The payment limit for ARC-CO and PLC payments has been increased to $155,000 per eligible entity or individual, beginning with the 2025 program. This is up from the previous payment limit of $125,000. An inflation adjustment factor was also added, which could allow for small increases in future payment limits. Farm businesses that are set up as S corporations and LLC’s will now be treated similar to general partnerships as far as determining the number of individuals that are eligible for payment limits; however, no details have been released regarding the revised payment limit eligibility.
 

• Will the OBBA provisions be implemented retroactively for the 2025 crop year ?

Yes, since farmers had already selected their farm program choice when the OBBA was passed, they will automatically receive the higher of any PLC or ARC-CO payments for a given farm program crop for the 2025 crop year, which will be paid in October. This provision will only be in effect for the 2025 crop year.  
 

• Will farmers be able to increase crop base acres for 2026 ?

The OBBA allows for the addition of up to 30 million more farm program base acres, which will be allocated among eligible program crops. The added base acres will be for acres planted to farm program crops that are currently not eligible for farm program benefits. It is not anticipated that this will include the opportunity to change or update existing crop base acres. It is likely that the new crop base acres will be eligible for farm program benefits for the 2026 crop year; however, no announcement has been made in that regard. As of this writing, USDA has not announced the details for adding crop base acres.
 

• What are the enrollment dates for the 2026 farm program ?

USDA has not yet announced the sign-up dates for the 2026 farm program. It is anticipated that sign-up may not begin until after the crop base acre update has been completed, which means that farm program sign-up may be delayed until late Spring or early Summer. The delay in the 2026 farm program sign-up beyond the normal March 15 deadline can actually be a benefit for producers, as it allows them to have a better handle on 2026 crop production and anticipated 2026 market year average prices. This can be very helpful when deciding between PLC and ARC-CO as a farm program choice for 2026.
 

• Where can producers get more information on the 2026 farm program ?

County Farm Service Agency (FSA) offices will provide information on the 2026 farm program details and sign-up procedures, as soon as information becomes available. The FSA offices will also be providing information on crop base acre upgrades, as soon as those details are available. The updated 2026 crop reference prices used to calculate PLC payments, as well as the 2026 benchmark prices, yields, and revenues used to calculate ARC-CO payments and other farm program information are available on the FSA website at: https://www.fsa.usda.gov/resources/programs/arc-plc/program-data
 

• What are the increased crop insurance premium subsidies that are in place for 2026 ?

The federal premium subsidies for 80 and 85 percent crop insurance coverage will increase by 3 percent for 80 and 85 percent coverage levels, with an increase of 5 percent for other levels of crop insurance. The 2026 premium subsidy is increased to 80% in 2026 for both Supplemental Crop Option (SCO) and Enhanced Coverage Option (ECO) insurance cverage. In addition, both SCO and ECO are now available with either the PLC or ARC-CO farm program choice in 2026.
 

• What are the extra premium subsidies for beginning farmers with ten years or less of farming experience ?

The additional beginning farmer premium subsidies in 2026, beyond the regular crop insurance premium subsidies, are as follows:

• Year 1 and 2 farming --- additional 15% premium subsidy.
• Year 3 of farming --- additional 13% premium subsidy.
• Year 4 of farming --- additional 11% premium subsidy.
• Year 5-10 of farming --- additional 10% premium subsidy.

 

• How could the increased premium subsidies and other changes affect crop insurance decisions ?

The increased premium subsidies will allow most corn and soybean producers in the Midwest to utilize and an 80 or 85 percent revenue protection (RP) insurance policy with farm-level APH yields, and then supplement that policy with SCO and ECO insurance coverage utilizing county yields. This can provide for up to 95 percent insurance coverage in 2026 at a fairly reasonable cost.
 
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For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group
Phone --- (507) 381-7960; E-mail --- [email protected] 

As has been often said with farming “every year is different”, and many times decisions for the current crop year are based on what happened in the previous year or two. That could be the scenario in some cases with considering the Enhanced Coverage Option (ECO) and Supplemental Coverage Option (SCO) insurance coverage options for 2026. ECO insurance has been around for several years but was not considered on a widespread basis due to the relatively high premium rates for ECO coverage and limitations for SCO coverage. That scenario has now changed due to much lower premium rates and fewer limitations on SCO coverage. This makes SCO and ECO a much more viable crop insurance option as part of an overall risk management package in 2026. The deadline to enroll in crop insurance for corn and soybeans in 2026 is March 16. 

NEW FOR 2026 
The Supplemental Coverage Option (SCO) coverage will be available to producers that choose the Price Loss Coverage (PLC) and the Ag Risk Coverage (ARC-CO) farm program options for the 2026 crop year. So the farm program choice will not impact SCO insurance coverage decisions, as it did previously. SCO coverage allows producers to purchase additional county-level crop insurance coverage up to a maximum of 86 percent coverage in 2026, which will increase to 90 percent coverage in 2027. For example, a producer that purchases an 80% RP policy for corn or soybeans could purchase an additional 6% SCO coverage in 2026. 
The Enhanced Coverage Option (ECO) provides area-based insurance coverage from 86 percent up to 95 percent coverage, with producers having a choice between 90 or 95 percent ECO coverage. The purchase of ECO coverage is not linked to farm program enrollment. Producers can utilize both ECO and SCO together, in addition to their underlying RP, RPE, or YP insurance policy; however, farmers do not have to purchase SCO coverage in order to purchase ECO insurance. 
The Federal government has increased the premium subsidies for both SCO and ECO coverage for 2026, which should make premiums more reasonable for crop insurance coverage options that include these products. Both the 90 percent and 95 percent ECO insurance coverage options will have a premium subsidy of 80% in 2026, which is the as the premium subsidy for SCO coverage. (This is a correction from last week’s column dated 1-26-26.) In 2025, the ECO coverage options had a premium subsidy of 65%, which was increased from a 44 percent premium subsidy in 2024. This is in addition to the premium subsidy increases of 3-5 percent on most farm-level revenue protection (RP) crop insurance policies for 2026. The increase in the premium subsidy in 2025 resulted in 61.8 million acres being insured under ECO coverage in 2025, as compared to only 15.6 million acres under ECO policies in 2024. With the additional premium subsidy up to 80 percent for the 2026 crop year, we will likely see another increase in the number of corn and soybean acres insured by ECO coverage in 2026. 

HOW ECO AND SCO INSURANCE COVERAGE FUNCTION 
ECO and SCO are county revenue-based insurance products that are somewhat similar to the area risk protection crop insurance products. The calculations for ECO and SCO function very similarly to standard revenue protection (RP) insurance policies, utilizing the same crop insurance Spring price and harvest price as RP policies. The 2026 crop insurance Spring (base) price is based on the average Chicago Board of Trade (CBOT) prices for December corn futures and November soybean futures during the month of February. The Spring price estimates (as of 2-02-26) are near $4.50 per bushel for corn and $10.75 per bushel for soybeans. The harvest price for SCO and ECO coverage, as well as RP policies, is the average price of the same CBOT futures months during the month of October. Producers can utilize both ECO and SCO insurance coverage together, in addition to their underlying RP, RPE, or YP insurance policy. The biggest difference from most RP insurance policies is that ECO and SCO utilize county level average yields, rather than the farm-level APH yields that are used for RP policies. 
Based on the current Spring price estimates of $4.50 for corn and $10.75 for soybeans, crop producers can guarantee a market price of $3.83 per bushel for corn and $9.14 per bushel for soybeans with an 85% RP insurance policy. However, the market price guarantee increases to $4.28 per bushel for corn and $10.22 per bushel for soybeans, when adding SCO coverage and a 95% ECO policy, utilizing county yields, together with the underlying RP policy. These price guarantee estimates assume that the final 2026 harvest yield is the same as the APH yield on the farm., and the final 2026 county average yield is the same as the original county average yield. Any variations in the final harvest yield at the farm-level or with the county average yield, either up down from the farm-level APH yield or the original county average yield, will cause these price guarantees to vary. 
Due to the difference in county and farm-level yields, the calculations for SCO and ECO policies may function differently than the underlying RP policies. It is possible for a producer to collect on an individual RP policy, but not collect on a SCO or ECO policy, or vice versa. For example, a producer with an 85% RP policy may have a loss that qualifies for an insurance indemnity payment on a farm unit, while the county as a whole may not meet the threshold to qualify for a SCO or ECO payment. It could also be possible to collect a SCO or ECO payment for a county-level revenue loss, while not qualifying for a RP insurance indemnity payment at the individual farm-level. 

BOTTOM-LINE ON ECO AND SCO INSURANCE COVERAGE OPTIONS 
In 1989, corn and soybean producers could only insure up to 75 percent of their crop guarantee (APH yield times the Spring crop insurance price), and the federal premium subsidy was only 30 percent. This made crop insurance fairly expensive for the risk protection that was provided. In 2026, farmers can insure up to 85 percent of their crop insurance guarantee, based on trend-adjusted (TA) farm level yields. Premium subsidies are now 41 percent for 85 percent coverage, 51 percent for 80 percent coverage, and 60 percent for 75 percent coverage. In addition, farmers can now insure up to 90 or 95 percent of the insurance guarantee, utilizing county average crop yields above their farm-level coverage. Farmers can now carry 95 percent insurance coverage at a net premium cost that is likely lower than the premium cost for 75 percent coverage back in 1989. 
The added premium subsidies make the higher crop insurance coverage levels available through SCO and ECO policies much more affordable for 2026. The enhancements to SCO and ECO coverage allow farmers to reduce risk and insure a higher percentage of their expected 2026 crop production at a reasonable premium cost. Many crop insurance companies have combined SCO and ECO coverage with other private insurance buy-up policies to offer some very attractive insurance options for 2026. Utilizing SCO and ECO coverage, together with a sound Revenue Protection (RP) policy on individual farm yields, an provide an excellent risk management package. 
Farmers should contact their crop insurance agent for details, premium quotes, and spreadsheets on various crop insurance coverage options, including ECO and SCO. 
Kent Thiesse, Farm Management Analyst, has prepared an information sheet titled: “2026 Crop Insurance Decisions” that contains more details on SCO and ECO insurance coverage, along with tables showing SCO and ECO examples. To request a free copy of this information sheet, send an e-mail to: [email protected] 
Some other good crop insurance resources include: Ø U of Illinois FarmDoc website - https://farmdoc.illinois.edu/ Ø Kansas State University - https://agmanager.info/ Ø Iowa State University - https://www.extension.iastate.edu/agdm/# Ø USDA Risk Management Agency (RMA) --- https://www.rma.usda.gov/ 
For additional information contact Kent Thiesse, Farm Management Analyst, Green Solutions Group Phone - (507) 381-7960; E-mail - [email protected]