The Margin Coverage Option (MCO) and Enhanced Coverage Option (ECO) are two powerful endorsements that can be added to a crop insurance policy to increase a producer’s coverage.
MCO protects an operation’s profit margin, defending against an increase in input costs or a decrease in revenue. It uses the fall price discovery period, allowing policyholders to lock in a projected price earlier in the season.
ECO offers protection based only on the producer’s yield or revenue, and uses the spring discovery period for the projected price.
Policyholders cannot purchase both MCO and ECO, and the MCO sales closing date is September 30, meaning that now is the time for producers to decide between these options.
Recent changes strengthen SCO coverage
As of the 2027 crop year, the SCO loss trigger has increased from 86% to 90%. Both MCO and ECO are commonly taken with the Supplemental Coverage Option (SCO).
With the change in coverage for SCO, the coverage range of MCO and ECO will be set from 95% to 90%. When paired with SCO, this reduces the deductible to only 5%.
Is MCO or ECO best for your producers?
When helping a producer decide between MCO and ECO, ask them these questions:
- Are you concerned that the cost of inputs (diesel, natural gas, urea, potash and DAP) will rise between now and April?
- Are you concerned that the price of your commodity will fall between now and February?
If the answer to either question is “yes”, your producer would likely benefit from the peace of mind that comes with MCO.
Producers who do not have these concerns may prefer the greater flexibility of ECO.
Learn more with our exclusive resources
The latest episode of our risk management video series, Straight to the Point, features an in-depth discussion about the benefits of MCO. Watch it here.
Our online toolkit, exclusive to AgriSompo agents, features a variety of downloadable resources, including an MCO calculation worksheet and maps denoting MCO’s availability by county and commodity.
We’re here to help
Still have questions? Your AgriSompo Business Development Representative is always ready to walk you through the details of any crop insurance product. Give them a call today!