Margin Coverage Option: MCO
One of the Easiest Ways to Protect Your Margin
New for Crop Year 2026
What It Is
Margin Coverage Option (MCO) is a new area-based insurance that protects the profit margin on your crop, not just yield or revenue. It helps cover losses when production costs rise, commodity prices fall, county-level yields drop, or when all three happen at once.
Area-Based Plan
The area-based plan looks at the average yield or revenue for the county rather than the individual far. If the county yield or revenue for that area falls below the averages, MCO provides a loss claim to all insured farmers within that county, regardless of their individual farm’s performance.
Coverage Bands
Crop Insurance can be thought of in tiers. The base tier is the Multiple Peril Crop Insurance (MPCI). This tier has the choice of coverages such as Revenue Protection and Yield Protection. The next tier will cover up where the MPCI coverage ends up to 86% of losses.
Margin Coverage Option covers 86% to either 90% or 95% of county revenue, depending on which level of coverage the grower selects.
Watch How MCO Protects Your Margins
Up to 95% Levels
Provides the highest level of insurance in the federal program 90/95%
Area-Based Coverage
Coverage is based on the county averages and production not on the individual operation
Easy CoVerage
Simplified choices for top-layer protection
Early Pricing Period
Lock in commodity prices before your MP policy
Protects Against Lower Prices
MCO covers a drop in commodity prices
Protects against lower County yields
MCO covers a drop in county yields
ProTects AgAinst Rising Input Costs
MCO covers multiple inputs critical for farming
Early Signup deadline
9/30 deadline to sign up for next crop year
Get a Personalized MCO Quote Today
What Does MCO Cover?
1. Rising Input Costs
Urea
Potash
Diesel
Diammonium Phosphate (DAP)
Irrigation Costs
2. County-Level Yield Loss
As an area-based plan, the county yields are the key factor. You could have a great year while your neighbors experience a tough year. You could be owed an indemnity payment for the area based plan while not experiencing a personal operational loss.
3. Falling Market Prices
MCO has an earlier Price Discovery Period than the underlying multi-peril crop insurance policy. The sign-up price will be compared to the harvest price. This is a potential opportunity to capture a higher price than the 3/15 price of the underlying multi-peril policy.
4. Combination of All
All of these factors are dependent on each other. Yields and prices can lower while input costs increase. This type of scenario would lead to a large indemnity payment situation.
Margin Coverage, Made Simple.
How Does MCO Work?
MCO tracks your expected vs. actual margin at the county level (area-based plan). If the actual harvest margin drops below your trigger level, you get a loss payment.
If the Harvest Margin is less than the Trigger Margin (90 or 95% of Expected Margin), an indemnity is triggered.
MCO In Practice
MCO Protects your margins. Letโs look at three examples for an operation growing corn on how MCO will protect their operation.
Harvest Margin and Indemnity Owed Scenarios.
MCO Availability
MCO is compared to lite Margin Protection
It gives you the core margin protection without the complexity or policy overlap. It’s ideal for producers who like the ECO/SCO model but want input cost protection added in.
Pairing MCO
MCO can be paired with:
- ARC
- PLC
- SCO (no overlapping coverage)
- STAX (no overlapping coverage at 90%)
County Specific Analysis
and Personalized Quote
PRM takes a deeper dive into MCO more than any other company. With PRMโs MCO analysis tools, PRM will do a county specific analysis to examine what opportunities there are for a farmer in the area. Using historical yield tracking, the analysis will show where yields are too high or too low compared to expected results.
Personalized Program
Comparison Analysis
Precision Risk Management takes the comprehensive look at your risk management plan to identify the best USDA and FSA programs. PRM will look at your specific operation and county to identify the largest revenue protection and the trigger points for each of the different programs.
Get a Personalized MCO Quote Today
Itโs easy to get Margin Protection (MP), Enhanced Coverage Option (ECO), and Enhanced Margin Coverage Option (MCO) confused.
At first glance, these products might look nearly identical. They all offer coverage above 80% levels, aim to protect revenue and margin, and are often used in tandem with your underlying Revenue Protection (RP) policy. But the differences on how each one works, when theyโre triggered, and how they pair with your operationโs risk profile can make all the difference in your bottom line.
