What type of insurance does PRF Rainfall protect against?

PRF Rainfall, or Pasture, Rangeland, and Forage Rainfall Insurance, specifically protects against the decline in index value based on precipitation levels. This insurance product is designed for producers who rely on rainfall for their pasture and forage production. It operates on an indexing system that measures precipitation in a defined area, and if rainfall levels drop below a certain threshold, the insured party can receive indemnities to offset losses associated with reduced forage growth. This is particularly crucial in areas where drought or insufficient rainfall can significantly impact the availability of feed for livestock, thus affecting overall production and profitability.

The other types of insurance cover different risks. Loss of livestock relates to perils like disease or accidents, crop damage from fire deals specifically with physical destruction caused by fire, and market price fluctuations are addressed through different types of crop revenue or price insurance products. Each of these focuses on distinct risks that do not align with the specific aim of PRF Rainfall insurance, which is solely tied to precipitation metrics.