Enclosure Page 2

FCIC Interpretation

Federal Crop Insurance Corporation Interpretation

Subject: Request dated December 12, 2023, submitted to the Risk Management Agency (RMA) for a 

Federal Crop Insurance Corporation (FCIC) interpretation of Section 33(a) of the 2020 Whole-Farm 

Revenue Protection (WFRP) Pilot Policy.

Reference:

The relevant policy provision from the 2020 WFRP Pilot Policy is:

33. Mediation, Arbitration, Appeal, Reconsideration, and Administrative and Judicial Review.

(a) If you and we fail to agree on any determination made by us, except those specified in 

this section 33(d) or (e), the disagreement may be resolved through mediation in 

accordance with section 33(g). If resolution cannot be reached through mediation, or 

you and we do not agree to mediation, the disagreement must be resolved through 

arbitration in accordance with the rules of the American Arbitration Association 

(AAA), except as provided in sections 33(c) and (f), and unless rules are established by 

FCIC for this purpose. Any mediator or arbitrator with a familial, financial or other 

business relationship to you or us, or our agent or loss adjuster, is disqualified from 

hearing the dispute.

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(c) Any decision rendered in arbitration is binding on you and us unless judicial review is 

sought in accordance with section 33(b)(3). Notwithstanding any provision in the rules 

of the AAA, you and we have the right to judicial review of any decision rendered in 

arbitration.

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(f) ...If there are conflicts between any rules of the AAA and the provisions of your policy, 

the provisions of your policy will control.

First Requestor’s Interpretation

The first requestor seeks an interpretation of Section 33(a) regarding who bears the burden to prove 

coverage defenses in an arbitration. The first requestor interprets Section 33(a) to mean that pursuant 

to AAA Rule 32(a), “Conduct of Proceedings” (“[t]he respondent shall ... present evidence to support 

its defense”), an insurer bears the burden of proving any coverage defenses that it asserts or asserted, 

including a purported inability to “accurately determine the amount and cause of loss.” The first 

requestor further interprets this Section to mean that an insured cannot be required in an arbitration to 

establish that an Approved Insurance Provider (AIP) was able to accurately determine the amount and 

cause of loss; instead, the burden to show that an AIP could not accurately determine the amount and 

cause of loss is on an AIP.

Second Requestor’s Interpretation

Section 33(a) states that the rules of the AAA apply “except as provided in sections 33(c) and (f)....” 

To this end, Section 33(f) provides that in arbitration, “the terms of this policy, the Act, and the 

regulations published at 7 C.F.R. chapter IV, including the provisions of 7 C.F.R. part 400, subpart P, 
Enclosure Page 3

FCIC Interpretation

are binding.” The second requestor contends that the burden of proof is established by Section 33(f) 

and the terms of the WFRP Policy rather than the AAA’s rules. Moreover, in accordance with, section 

23(d) of the WFRP Policy states that the AIP will pay an indemnity only if the insured has complied 

with the terms of the policy. Therefore, the second requestor interprets that the insured has the burden 

of proving that it complied with the policy, including providing the AIP with all notices, records and 

information needed to determine the amount and cause of loss.

Federal Crop Insurance Corporation Interpretation

FCIC disagrees with both requestors. FCIC interprets Section 33(a) of the 2020 WFRP Pilot policy to 

mean that any disagreement between the insured and the AIP may be resolved by mediation, and if the 

disagreement is not resolved through mediation, then the disagreement must be resolved through 

arbitration. Furthermore, FCIC interprets Section 33(a) to mean that if the disagreement enters

arbitration, the arbitration must be conducted in accordance with the rules of AAA, except when 

Sections 33(c) or 33(f) apply. FCIC interprets Section 33(c) to apply only after a decision has been 

rendered by the arbitrator and gives both the insured and the AIP right to seek a judicial review of 

such decision. FCIC interprets the relevant part of Section 33(f) to mean that if there is a conflict 

between the rules of AAA and the WFRP Pilot Policy, then the WFRP policy will prevail.

Regarding the requestors’ interpretation of which party bears the burden of proof, FCIC does not 

interpret any provision within the 2020 WFRP Pilot Policy including Sections 33(a), (c), or (f), to 

address the burden of proof issue. Therefore, because the 2020 WFRP Pilot policy is silent on burden 

of proof, the AAA rules apply. As a courtesy, FCIC is providing a rule from the 2022 Arbitration 

Rules and Mediation Procedures, but we note that the AAA is the best source for up-to-date 

information on its procedures.

Rule 33(a) of the 2022 Arbitration Rules and Mediation Procedures:

(a) The claimant shall present evidence to support its claim. The respondent shall then present 

evidence to support its defense. Witnesses for each party shall also submit to questions from 

the arbitrator and the adverse party. The arbitrator has the discretion to vary this procedure, 

provided that the parties are treated with equality and that each party has the right to be heard 

and is given a fair opportunity to present its case.

In accordance with section 33(a)(1) of the WFRP Pilot Policy, this FCIC interpretation is binding in 

any mediation or arbitration. In accordance with section 33(a)(1) of the WFRP Pilot Policy, any 

appeal of this interpretation must be in accordance with 7 C.F.R. part 11.

Date of Issue: February 28, 2024