Leaders assure indemnities will be paid
After USDA released numbers that at least begin to show the kinds of losses most corn and soybean farmers are facing this year, leaders of the national crop insurance industry said Friday their industry will be able to shoulder the burden created by the massive number of indemnity claims that will be coming from the field as harvest nears.
Expressing a vote of confidence about the big question of whether the industry would be able to handle the flood of claims it has seen and will continue to see from farmers, National Crop Insurance Services president Thomas Zacharias said Friday his industry will be up to the challenge.
"In order to be approved to sell federal crop insurance, companies must have adequate surplus and reinsurance at their disposal so that even if a catastrophe of this magnitude strikes, and then one strikes again the next year, the company is still capable of paying indemnities on the policies they sell," Zacharias said in a statement Friday.
Support from the federal government will lend strength to the industry that will likely see a record number of indemnity payouts this year.
"In addition to company surplus and reinsurance, the federal government, serves as the backstop reinsurer for all companies that sell crop insurance," Zacharias said. "As such, the federal government shares in the gains and the losses of the program. Gains in prior years can and will be used to offset losses in years like this one."
Then, there's the logistical side of the crop insurance equation. Right now, Zacharias says there are 5,000 claims adjusters and more than 15,000 crop insurance agents in the field to help farmers file claims. To date, $822 million has been paid in indemnities for this year's crop.
"Companies are also mobilizing adjusters away from other parts of the country that have not been affected by drought and sending those adjusters to the hard-hit states," Zacharias says.
If you've got fields awaiting your adjuster's visit, there are things you can do to streamline the process. Doing so will pay dividends, says Dereck Klaassen, Field Supervisor for Farmers Mutual Hail Insurance Company of Iowa.
"People need to take time and get their crop insurance agent in the loop with what they want to do with their crops and keep records in an orderly fashion. That will result in quicker payments and getting that check," Klaassen says. "It will allow the adjuster to complete the claim quicker, most of all. But, there's not going to be a one-size-fits all solution for everybody. If they can get their agent involved and get the right people that can get us into fields and look around, it can get completed as quickly as possible."