Texas All Lines Adjuster Practice Test

What aspect of insurance does Crop Revenue Insurance help address?

1. Prevention of crop theft

2. Loss of yields and fluctuations in prices

3. Only yield loss due to bad weather

4. Insurance against crop manipulation

The correct answer is: Loss of yields and fluctuations in prices

Crop Revenue Insurance is designed specifically to mitigate the financial risks that farmers face due to decreases in actual crop revenue resulting from lower yields and fluctuating market prices. This type of insurance combines coverage for yield losses, which may occur due to various factors such as pests, disease, or adverse weather conditions, with protection against price declines that can negatively impact the profitability of the crops sold. By addressing both yield loss and market price fluctuations, Crop Revenue Insurance provides a more comprehensive safety net for producers, helping them stabilize their income in the face of unpredictable agricultural markets. This dual protection is particularly important for farmers who may face challenges in both aspects simultaneously, ensuring they receive a level of financial security and certainty in their operations.