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It's All About Relationships.

Source: California Fresh Fruit and Raisin News

In the world of farming, government subsidization attempts to strengthen the agricultural sector and assure a safe and reliable food supply. For the most part it does a pretty good job of it. In the case of crop insurance, the USDA subsidizes a portion of the premiums because private companies are unwilling to assume the risk of a geographically broad catastrophic event, like a flood, hurricane, or freeze. Because the premiums are subsidized, a grower’s crop insurance premium is the same regardless of where they purchase it. This has only created a stiffer form of competition based on customer service and relationships.

Some farmers, in milder climates, choose not to pay for crop insurance because the weather is so predictable. Others, however, may have to rely on it heavily at times in order to balance out the troubles caused by the variable, and at times, relentless whims of nature.

The weather in California is generally considered to be mild, especially when compared to other states and areas of the country. In some areas, though, a farmer may enjoy a nice bloom season one year, and then prolonged rain or a frost the next. This makes crop insurance a particularly tricky industry.

Nature often requires farmers to work very closely with insurance agents, companies, and adjusters as their federally insurable crop acreage goes in and out of production. This is what makes the customer service element of crop insurance so critical.

“Like so many things in our industry, and in the world in general, it’s all about relationships,” said Leslie Leavens-Crowe of her choice to purchase crop insurance from Mary Roach Insurance Agency, Inc. (MRI) Her company, Leavens Ranches, a member of the Sunkist Co-Op, grows avocados and lemons in California’s Monterey and Ventura counties. One of her partners in Monterey County had a really good experience with their insurance agent, so her company decided to go with them too. That was a long time ago.

Leslie remembers when Jordan Roach, now Vice President of Mary Roach Insurance Agency, was still in school and would spend part of his summers riding an ATV around measuring her acreage with a GPS unit.

In addition to Mary and Jordan, Leslie looks forward to talking to Kim and the rest of the office staff at MRI. “We look forward to finding out what’s happening in their lives, with their kids and grandkids: it’s about relationships all the way through”, she exclaimed. “They’re always so available by phone or email, and are just so responsive to getting back to me if I do have a question.”

Leavens-Crowe continued, “The thing about crop insurance is that it is so complicated. There are differences in insurance for avocados and lemons, and there are different kinds of products. It is so difficult to get each product straight and understand it; and Mary and Jordan are always very available to help us out and select a product for our needs.”

Keeping up with acreage is just one of the tasks MRI has to meet the demands of. As a broker of insurance, and not a provider, it is an essential element of their business to find the right insurance products and companies for their clients.

As is the case with avocados and most crops in general, the production varies from year to year. Leavens-Crowe explained that her ranch has a lemon variety they started growing that really produces a beautiful and perfect lemon. But it was not as productive, in the long term, as they had hoped; and they found that they had some other blocks, which were not as high of quality as they wanted, but these were producing a much higher volume per acre, and, as a result, a much higher return per acre.

“A year ago,” Leavens-Crowe explained, “we went through some grafting procedures to try to get the higher quality lemons out of the stumps that had proven to produce higher volume. While in this process these trees were out of commission and no longer insurable.” Crowe continued, “In a couple of years they will be back in to production, so there will be a need to insure them again. It’s Kim and the rest of the staff that helps us keep track of all that, and it can get pretty complicated.” MRI was with them all the way through this difficult period.

We also spoke with James Sherwood of Bee Sweet Citrus located in Fresno County, California. James is another satisfied client of MRI. He feels, “having a crop insurance agent as one of our team members is really beneficial to [his] business.” He continued, “we chose MRI because of their organization, responsiveness, and ability to provide structured information to help us find out what our true costs are and how to insure them.”

Although the Federal government subsidizes crop insurance it doesn’t cover all of your costs of doing business, as James pointed out. So, farmers have the option to also buy private insurance to supplement the gap. “There is a “sweet spot” to maximize your value per dollar in federal and private insurance. There is a cross section based on the historical averages of your ranch’s productivity (fresh cartons packed) and losses, and then how much private and how much federal insurance to buy; Mary Roach helps us find that spot.”

Insurance costs are part of Bee Sweet’s business model. Keeping this in mind, Bee Sweet uses their crop insurance agent to help them cover the costs of farming all their acreage. This helps them to minimize the lows of production by buying insurance to cover costs and not be in the red should a weather event or other catastrophe occur.

The Federal government requires companies like Bee Sweet and Leavens Ranches to keep detailed and very specific records of their acreage and how they insure it. “MRI’s customer service is outstanding”, said James. “They provide us with new, up to date worksheets to help us calculate our costs, based on our historical averages, every year in case we’re ever audited.”

In the world of crop insurance there are a lot of changes from year to year. Insurance agents and companies have to keep up with all of them. According to Leslie Leavens-Crowe, “The ravages of nature make every year a challenge or a blessing… Mary, Jordan, and the rest of the team keep us and our needed coverage on track and they do it all very well.” Talk to any of their clients and you’ll likely hear the same thing.