LRP and PRF Livestock Insurance: How They Work

This is a free guide, not financial or legal advice. Program details change. Always verify current information with your crop insurance agent or local USDA office before making decisions. Help us improve: if something here is wrong or outdated, let us know.

How Livestock Insurance Is Different

If you're used to working with NRCS or FSA, livestock insurance is a different system entirely. Here's what to know:

• Not through NRCS or FSA. Livestock insurance is sold by licensed crop insurance agents , private-sector professionals, the same people who sell crop insurance to your neighbors. NRCS and FSA don't sell or administer these products.
• Federally subsidized. Federal subsidy covers a substantial portion of the premium — ranging from 18% to 59% depending on the product and coverage level. This is built into the price your agent quotes you.
• Administered by USDA's Risk Management Agency (RMA). RMA sets the rules, approves the products, and reinsures the policies. Your agent is the point of contact.
• Three main products for cattle: LRP (price protection), PRF (rainfall/drought protection), and LGM-Cattle (margin protection). Your agent can explain which fit your operation.

LRP (Livestock Risk Protection)

What It Is

LRP is price insurance. It can put a floor under your sale price for fed cattle, feeder cattle, or swine. If the market drops below your coverage price, LRP may pay the difference. If the market stays above your floor, the endorsement simply expires and you sell at market price.

How It Works

You buy a Specific Coverage Endorsement (SCE) from your crop insurance agent. The endorsement locks in a coverage price based on CME futures and options markets. At the end of the endorsement period, RMA compares your coverage price to the actual ending value , a market price index published by RMA. If the actual ending value falls below your coverage price, you may receive an indemnity for the difference, multiplied by the number of head and their weight.

No paperwork at sale time. No individual loss documentation. If the price stays above your floor, the endorsement expires with nothing owed on either side.

Key Details

• Coverage levels: 75–100% of expected ending value
• Endorsement periods: 13, 17, 21, 26, 30, 34, 39, 43, 47, or 52 weeks
• Subsidy rates: 35–55% of premium depending on coverage level (higher subsidy at lower coverage levels)
• Head limits: Up to 12,000 head of cattle per endorsement and 25,000 per crop year (July 1 – June 30), for feeder or fed cattle
• Available year-round: New endorsements are available most business days
• Premium is billed after the endorsement ends, not at purchase

Example: 200-Cow Operation

A 200-cow herd doesn't sell 200 steers. Say it sells about 90 steer calves at 550 lb and 80 heifer calves at 500 lb (these head counts and weights are assumptions for the example):

• Insured weight: 90 × 5.5 cwt = 495 cwt of steers, and 80 × 5.0 cwt = 400 cwt of heifers, 895 cwt in all
• What producers actually paid: in RMA's LRP data for reinsurance years 2021 through 2025 (July 2020 to June 2025), producer premium after subsidy on endorsements above 95% coverage averaged $6.34/cwt for feeder steers and $5.82/cwt for feeder heifers. By year it ranged from $4.41 to $7.45 for steers and $4.18 to $6.80 for heifers.
• Premium at those averages: 495 × $6.34 = $3,138, plus 400 × $5.82 = $2,328, about $5,466 in all (between about $3,855 and $6,408 using the lowest and highest years)
• At 90 to 95% coverage the averages were lower: $2.90/cwt for steers and $2.62/cwt for heifers, about $2,484 for this example, for a lower floor
• If the actual ending value finished $15/cwt below your coverage price on both endorsements: 895 cwt × $15 = $13,425 indemnity

Over those five years, feeder steer endorsements above 95% coverage paid back about $0.68 in indemnities for every $1 of producer premium. Indemnities exceeded producer premium in 2022 and 2024, fell short in 2021 and 2023, and in 2025 almost nothing paid. These are national averages across all endorsement lengths; your quote depends on the week, the coverage price, and the endorsement length. The LRP Backtest shows the same RMA data by coverage level and year.

PRF (Pasture, Rangeland, Forage : Rainfall Index)

What It Is

PRF is area-based insurance for grazing and hay land. It's based on a rainfall index , not your individual losses. If rainfall in your NOAA weather grid drops below your coverage level during the intervals you selected, you may receive a payment. You don't need to document individual losses, file a claim, or prove that drought hurt your operation specifically.

How It Works

Your land falls within a specific NOAA weather grid. You choose at least two two-month intervals to insure, the periods when rainfall matters most for your forage. The intervals can't share a month. If the rainfall index for your grid drops below your coverage level during those intervals, the payment is triggered automatically.

Key Details

• Grid-based: Uses NOAA weather grids, not your specific ranch
• Interval selection: Choose at least 2 of the two-month periods (Jan–Feb, Feb–Mar, Mar–Apr, and so on). No month can be in more than one selected interval, so the most you can pick is 6.
• Coverage levels: 70–90%
• Productivity factor: 60–150%, applied to the county base value
• Subsidy rates: 51% at 90% coverage, up to 59% at lower coverage levels , heavily subsidized
• Enrollment deadline: Typically December 1 for the following crop year. This is a hard cutoff.
• Interval weights (percent of value): Split your total protection across the intervals you choose. Each interval needs at least 10%, the maximum per interval is set in your state's Special Provisions, and the weights must total 100%
• No individual loss documentation needed : payment is triggered by the rainfall index, not by your specific situation

New for 2027: Livestock on Insured Grazing Acres

Starting with the 2027 crop year, if you insure acres for grazing, you need an insurable interest in enough livestock grazing those acres to equal at least 25% of the stocking rate for the insured acres (PRF Crop Provisions, section 4(j)).

• Which stocking rate: the rate in the FSA National Crop Table, or the rate on your state or federal grazing lease. If neither covers your acres, you may use a stocking rate from another federal agency. A private lease’s rate does not count.
• Example (assumed rate): 960 insured grazing acres at an assumed 8 acres per animal unit carry 960 ÷ 8 = 120 animal units. 25% × 120 = 30 animal units, so you would need records for at least 30 beef cows. RMA counts an adult beef cow, or a cow-calf pair until weaning, as 1 animal unit.
• Landowners who lease out grass: for grazing acres, insurable interest is already based on the livestock, not the land. A landowner who cash-leases pasture to someone else’s cattle is not considered to have a share in the insured crop.
• Records: keep verifiable stocking-rate and livestock records, such as calf sales, purchase receipts, or vet and pregnancy-check records, for 3 years after the crop year. They are reviewed only on request, but if you cannot show the 25%, no indemnity is due and the full premium is still owed. If drought or another natural cause forces you to destock, you can keep coverage with records of what you sold or moved; a management decision to run fewer head does not count.
• Federal and state leases: acres are not insurable for a crop year if the land management agency has not authorized use that year or has assigned zero use. RMA lists this as a clarification for 2027.

Ask your agent before December 1 how this applies to your acres and herd.

Example: 1,200-Acre Ranch (Illustrative)

A hypothetical 1,200-acre grazing operation insuring 960 acres. The county base value and premium rates are made up for the example; your agent can quote your grid's actual numbers.

• Protection per acre: $8.00 county base value × 90% coverage × 100% productivity factor = $7.20
• Total policy protection: 960 acres × $7.20 = $6,912 for the year
• Interval weights: 50% on April–May and 50% on July–August, so each interval protects $3,456
• Premium: using the illustrative rates in RMA's Rainfall Index handbook example (0.10 for April–May, 0.11 for July–August), total premium is $3,456 × 0.10 + $3,456 × 0.11 = $725.76. At 90% coverage the federal subsidy is 51%, so you would pay 49%, about $356
• If July–August rainfall comes in at 40% of normal (final grid index 40) and April–May is normal: your trigger is 90 (100 × 90% coverage). Payment factor = (90 − 40) ÷ 90 = 0.556. Indemnity = 0.556 × $3,456 = $1,920. April–May pays $0.

The most this policy can pay in a year is its $6,912 total protection, and only if every insured interval came in at zero rainfall.

The key decision is which intervals to insure. Some intervals trigger frequently in your area, others rarely. Historical data matters.

LGM-Cattle (Livestock Gross Margin)

LGM-Cattle is margin protection. Instead of covering the sale price (like LRP) or rainfall (like PRF), it covers the gap between expected cattle revenue and feed costs , specifically corn and feeder cattle prices based on CME futures.

• How it works: Based on CME live cattle, feeder cattle, and corn futures. It can protect against a margin squeeze , when feed costs rise or cattle prices drop, or both.
• Sales and insurance period: Sold weekly; each policy has a rolling 11-month insurance period, with coverage on up to 10 of those months
• Deductible: $0–$150 per head
• Premium subsidy available but typically lower net subsidy than LRP
• Best for: Feedlots and backgrounders who buy cattle and feed. Less commonly used for cow-calf operations.

LGM-Cattle is worth asking about if you background calves or run a feedlot.

Side-by-Side Comparison

Questions to Bring Your Agent, by Operation Type

Which products fit depends on your risks, your cash flow, and your marketing plan. These are questions to ask, not recommendations.

Cow-calf

• Which PRF intervals have triggered most often for my grid, and how did they line up with my dry years?
• What would PRF cost at 70%, 80%, and 90% coverage, and with what productivity factor?
• For my calf sale window, what would LRP cost at 90% to 95% versus above 95% coverage, and for which endorsement lengths?
• Should I split LRP into more than one endorsement if I sell calves over several months?

Stocker or backgrounder

• How would LRP on the cattle I buy compare with LGM-Cattle, which also accounts for feed cost?
• Does PRF make sense for the grass I run cattle on?
• What head limits apply to my endorsements this crop year?

Any operation

• What is the producer premium after subsidy, in dollars, and when is it billed?
• What has this product paid back, in indemnities per premium dollar, in my area over the last five years?

What Most People Get Wrong

• Not knowing these products exist. Many ranchers think "crop insurance is for crops." LRP and PRF are livestock products designed specifically for cattle operations. They've been available for years and are underutilized relative to crop insurance.
• Buying PRF without looking at historical data first. Some intervals trigger often for your grid, others rarely. Choosing intervals based on gut feel instead of historical rainfall data can mean paying premiums for coverage that almost never pays. Use grid-level historical data before choosing.
• Missing the PRF deadline. December 1 is a hard cutoff. If you decide in January that you want PRF, you wait a full year. Talk to your agent by early November.
• Only buying LRP for one endorsement period. Price risk doesn't line up neatly with one window. If you're selling calves over several months, consider staggered endorsements to cover different sale dates.
• Not talking to an agent. LRP and PRF agents are often the same people who sell crop insurance in your area. If you don't have one, your local FSA office or Extension service can give you a name. The initial conversation is free and takes about 20 minutes.

How These Work With Disaster Programs

LRP and PRF are insurance products administered by RMA. LFP (Livestock Forage Disaster Program), LIP (Livestock Indemnity Program), and ELAP (Emergency Assistance for Livestock, Honeybees, and Farm-raised Fish) are disaster programs administered by FSA. They're separate systems.

You can have both. PRF on your grazing land AND file for LFP when drought triggers a Drought Monitor designation. LRP on your calves AND file for LIP if you lose livestock to an eligible weather event. These are different programs with different triggers.

PRF and LFP can overlap: PRF triggers based on the rainfall index for your grid. LFP triggers based on U.S. Drought Monitor designations for your county. Different triggers, and both can pay for the same drought event.

Insurance is not a condition for the main livestock disaster programs: LFP, LIP, and ELAP do not require PRF, NAP, or any other coverage on your forage acres. PRF and NAP are separate protection that can pay on top of them. Some one-time programs (SDRP, for example) have required recipients to buy crop insurance or NAP afterward, so check with your local FSA office on current requirements.

What to Do

If you've never looked into livestock insurance: Call a crop insurance agent. If you don't have one, your local FSA office or Extension agent can recommend one. Tell them you want to learn about LRP and PRF for a cattle operation. The conversation is free.

If you already have PRF but not LRP: Talk to your agent about adding LRP endorsements before your next calf sale. Ask them to show you what different coverage levels and endorsement periods would cost for your herd size.

If you already have LRP but not PRF: The enrollment deadline is typically December 1. Talk to your agent by early November. Use our PRF Rainfall Analysis tool to see which intervals have historically triggered for your area.

If the PRF deadline has passed: Put early November on your calendar for next year's December 1 deadline. In the meantime, ask your FSA office about NAP coverage on your forage acres (the NAP service fee is the lesser of $325 per crop or $825 per county, and NAP has its own application deadlines). LFP, LIP, and ELAP do not require it.

Every cattle operation faces two risks that insurance can address: the price you get for your animals and the weather on your grazing land. LRP and PRF are designed specifically for these risks, and the federal subsidy means the cost may be lower than you'd expect. A 20-minute conversation with a crop insurance agent can tell you what it would cost for your operation.

• LRP Calculator: see what endorsements would cost for your herd
• PRF Rainfall Analysis: historical trigger rates for your grid
• Disaster Assistance: LIP, ELAP, LFP for livestock losses
• Program Stacking: combine insurance with cost-share and disaster programs
• Drought Dashboard: current conditions for your area
• Take the eligibility screener
• Find a crop insurance agent (RMA)

Sources

• PRF protection, percent of value, minimum of two index intervals, productivity factor (60–150%), 51% subsidy at 90% coverage, and premium example rates: RMA, Rainfall Index Insurance Standards Handbook, 2027
• PRF payment calculation factor ((trigger grid index − final grid index) ÷ trigger grid index): RMA, Rainfall Index Plan Common Policy (27.1-RI)
• PRF 10% minimum per interval, no shared months, December 1 cancellation date, the 2027 livestock and stocking-rate requirement (section 4(j)), zero-use lease acres (4(e)(2)), and 3-year records (8(a)): RMA, PRF Crop Provisions (27-RI-PRF)
• Animal-unit chart, cash-lease landowners, and destocking records: RMA, Rainfall Index Insurance Standards Handbook, Exhibit 6; records on request and cow-calf pairs: RMA PRF Stocking Rate FAQs (October 2026)
• How PRF works and interval selection: RMA, PRF frequently asked questions
• LRP producer premium, subsidy, and indemnity by coverage level, reinsurance years 2021–2025: RMA Livestock and Dairy Participation Summary of Business, compiled in Farmer's Navigator's LRP Backtest data (updated October 10, 2026)
• LRP coverage levels (75% to 100%), endorsement lengths and head limits: RMA, Livestock Risk Protection Insurance Standards Handbook, 2027 (FCIC-20010)
• Livestock insurance plans: RMA, Livestock insurance plans

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