When does a producer receive an indemnity with revenue protection?

A producer receives an indemnity with revenue protection when production to count is less than the revenue protection guarantee multiplied by the insured acres. This means that if the actual revenue earned from the crop falls short of what was guaranteed under the policy, the producer can file a claim and receive compensation for the difference.

In the context of revenue protection, the policy is designed to safeguard against loss of revenue due to low prices and/or low yields. The guarantee is calculated based on the expected yield and the established market price. If the market conditions result in production levels that do not meet this revenue guarantee, then the producer is eligible for an indemnity payment to cover their losses.

The other options do not accurately describe the conditions under which an indemnity payment is triggered. For instance, receiving an indemnity when revenue is above the guarantee would not align with the principle of insurance, which is to compensate for losses rather than profits. Additionally, the total crop yield being less than 50% does not directly relate to how indemnity calculations are made in revenue protection policies, as indemnity is more closely tied to performance against the specific revenue guarantee rather than a yield percentage alone. Similarly, a market price exceeding the established price might not initiate an indemnity unless it directly