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03-12-12


Agency Exclusive Insurance Products come to Crop Insurance



Several midwestern Farm Credit Associations are marketing a new supplemental program for its MPCI clients. EnterprisePlus, a trademarked product of 1st Farm Credit, reportedly allows farm credit MPCI customers to take advantage of increased subsidies and premium discounts for enterprise units and then buy back optional units using this non-reinsured (by FCIC) supplemental product at a savings. The optional unit coverage is provided at a lower level (higher deductible) than the overall enterprise coverage level. ADM Crop Insurance Services is the crop insurer. 


Exclusive crop insurance products spawned by large insurance retail agencies is a new strategy in the crop insurance market. Until now, such products have either been generally available through all crop insurers or all agents of a specific crop insurer.

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02/26/12
Crop Hail Insurers get hit where it hurts - their pocketbook!

Preliminary results for the crop-hail insurance industry show a pure loss ratio of 100 with rumors that final numbers will be closer to 115. If you add a normal expense load of 30 points, that's calculates to a whooping 145 combined loss ratio on a record $820 plus million.

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03/04/12

Three Alternative Ways to Success


I heard the other day that there are three alternative ways to be successful in business:

 

Be First

Be Smart

Cheat

 

I have tried the first two with varying degrees of success and but I have been beaten by the last more than once.


Cheaters do not tolerate smart, because their ways are easily discovered by smart. Cheaters cannot operate in the open.

 

Being First is exceedingly hard to do consistently and has inherent risks. To quote another “Pioneers get the arrows, Settlers get the land.” But there is a certain amount of pride in watching others copy your innovation and do it poorly.

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Early Planting Not Good for Crop-Hail Insurers

04-01-12

Crop-Hail Insurers who are still reeling from last year's devastating losses may not find much relief with this year's early spring.  While some farmers are waiting on crop insurance beginning planting dates, others are getting itchy to put seed into the ground. The unusually warm weather will cause plants to leap out of the ground and crops will be at much more advanced vegetative stages when early storms strike compared to the average.

Advanced crop growth stages means greater crop losses to hail.  Early storms that normally would have pounded bare ground or the growing point still below the surface, this year will have stems and leaves to shred.

Historically, an early start would also mean that replant provisions would limit hail losses to companies. However, in recent years, the replant provisions have changed from a mandatory cap on early losses to an optional benefit to the farmer. Most policies will pay on the early hail damage and then the farmer can replant and insure the second crop again at his option.
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CropInsuranceXpert.com Launches New Research, Competitive Intelligence, and Product Analysis Consortium

CropInsuranceXpert.com, a business unit of CVision, is launching a new membership consortium. The consortium members will be able to share various topical research, product analyses, and competitive intelligence reports relevant to US crop insurance. Consortium members will also be able to request specific research, program audits, and product reports for their exclusive use.

Crop Insurance Industry in flux

Steve Griffin, the analyst behind the new service, says that "it is readily apparent that the economics of the crop insurance industry are in a state of flux and not for the better.  Its fortunes are teetering on the next move of the US Congress and Mother Nature.  Furthermore, the “deck” is being stacked differently than in the past." He cites the following points for crop insurance stakeholders to consider as they look to the crop year ahead:


  • The 2011 Standard Reinsurance Agreement (SRA) imposed significant cuts on the federal crop insurance program.


  • RMA is implementing a new, untested, rating methodology that significantly lowers premium rates on major volume crops, corn and soybeans, in the Midwest. 


  • Guarantees based on “trend adjusted” APH yields are increasing the effective coverage level at average (not marginal) premium rates.


  • Increased subsidies and significant discounts is shifting the book of business to enterprise units.


  • The premium volume required for a crop insurance writer to capture economies of scale has grown substantially.


The implications of these changes are far-reaching. Stakeholders, such as reinsurers, who previously have placed their trust in a continuance of prior profits are in for a surprise. To avoid  surprises, they need to arm themselves with a new, unbiased, and sound intelligence gathering service.


Contact Information

Stakeholders interested in this new service should email:

info@cropinsurancexpert.com or use the following:

 


* First name (required):

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Phone number:
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 ATTORNEYS

If you are searching for an expert witness or just need to understand the merits of a case involving crop insurance, call or email for a free one-hour introductory consultation.

 

 

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Interesting Agricultural and Commodity Stocks
at a Glance.
 
SymbolPriceChange% Chg
MON69.89-0.25-0.36%
DE73.190.220.30%
ADM31.82-0.39-1.21%
AFG37.77-0.38-1.00%
TSN19.12-0.09-0.47%
SFD20.200.020.10%
ACE72.02-1.40-1.91%
AGU76.48-0.70-0.91%
AU:QBE12.46unch0.00%
DD47.97-0.87-1.78%
GLD154.551.751.15%
SLV27.790.552.02%
WY18.760.070.37%
ACE72.02-1.40-1.91%
Quotes are by IDC Comstock and are delayed 20 minutes.
Fund prices are from Morningstar.
 
West Des Moines, IA
Updated Sunday, May 20, 2012 12:54 PM
Cloudy
Cloudy
67°FHigh: 71°F
Low: 49°F
Wind: 16 mph
Humidity: 57%
MSN WeatherData provided by iMap