Farm Produce Insurance Act (PA 198 of 2003, as amended)
Public Act 198 of 2003, as amended created the "Farm Produce Insurance Act" to establish a program in which producers of dry beans, grains, or corn could contribute a percentage of their proceeds to a new fund, and could recover from the fund for losses caused by a grain dealer's financial failure. The law does the following:
- Created the Farm Produce Insurance Fund to provide for reimbursement to a participating producer for losses suffered when a grain dealer declared insolvency or was otherwise unable to pay its claimants.
- Established the Farm Produce Insurance Authority to direct and control the Fund.
- Provided for the Authority to be governed by a seven-member board representing producers, and agricultural lenders.
- Required participating producers to pay a premium of up to 0.2% of the net proceeds from all farm produce sold by a producer to a licensed grain dealer, to be deducted from proceeds at the time of sale.
- Provided for a refund of this premium to a producer who agreed not to participate in the program.
- Required the board to take action when it determined that a grain dealer had failed financially.
- Provided that violators would be guilty of a misdemeanor, punishable by a maximum fine of $5,000.
- Repealed the Michigan Agricultural Commodity Insurance Act, which provides for the establishment of the Michigan Agricultural Commodity Insurance Fund to insure agricultural commodities against losses due to the failure of a licensed grain dealer.
For more information, visit the MDARD's Grain Dealer's website at: www.michigan.gov/graindealers.