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Delta Council endorses insurance carriers

Companies agree to contribute monetarily to regional group You could call it Delta Council's version of the "Good Housekeeping Seal of Approval." After an extensive review of the crop insurance options available to Mississippi producers, Delta Council is endorsing two crop insurance companies, which have, in turn, agreed to monetarily contribute to Delta Council.

The two companies, Fireman's Fund and IGF, have pledged their support of Delta Council membership through an agreement to pay annual membership dues to Delta Council. These dues, according to Delta Council Executive Director Chip Morgan, will be at a level that is commensurate with the current size and expanding growth of the crop insurance industry in the Mississippi Delta.

Delta Council's review of the Mississippi crop insurance industry, and its subsequent endorsements, were prompted by requests from its membership to evaluate the insurance options currently available to farmers throughout the Delta. The endorsement agreement with the crop insurance companies, Delta Council says, will not translate into any additional premium costs to farmers.

"A substantial number of our farmer-members have come to me and other Delta Council farm policy leaders to ask, `if Louisiana, Arkansas, and other farm organizations have gotten into the delivery of crop insurance, why haven't we looked at a way for Delta Council to play a role in this business," says Delta Council President Kenneth Hood of Perthshire, Miss.

"We were told by those farmers encouraging our pursuits that they either wanted us to get into the crop insurance business in a way which would return a monetary benefit to the farmer, or figure out a way for this growing business to pay its fair share in terms of membership support for Delta Council."

In an attempt to answer this question and evaluate the crop insurance delivery system in Mississippi, Delta Council established a committee of farm owners from nine Delta counties. The committee then looked into either establishing an independent crop insurance agency, establishing a cooperative similar to those operating in Arkansas and Louisiana, or establishing an endorsement agreement with existing companies in exchange for their support of Delta Council membership.

"It became apparent to us early-on during our meetings and through the presentations made to us that Delta Council had several options that were worthy of consideration, including the possible establishment of a full-blown insurance agency with marketing, sales, and administrative support," says committee member Tom Robertson of Indianola, Miss.

However, he says, "We didn't feel that Delta Council should assume either the risk or the full responsibility of managing an agency, since farmers continue to tell us they receive excellent service from the existing crop insurance agencies serving the Delta Council area."

Before deciding that the endorsement agreement was the best route for Delta Council to pursue, Robertson says, the committee first insured that such an agreement would not increase the farmer cost of crop insurance in any way.

"I liked the arrangement regarding the endorsement because it didn't involve a lot of new overhead costs and it would be an arrangement with the insurance providers rather than an exclusive arrangement with one agency that operates in the Delta," Hood says. "Once we confirmed that none of the costs associated with the endorsement would be passed back to the farmer, we wanted assurances that farmers would have the option to request their policy be written by one of several companies, instead of an exclusive arrangement with just one company. Also, we wanted to positively insure that every local crop insurance agency in the Delta would have the opportunity to participate in this arrangement on the same, equal basis."

The agreement also stipulates that Delta Council will not "engage in the administration, sales or marketing of any particular crop insurance products." The reason for this, the group says, is that because farmers and farming operations possess distinctly separate and individual needs, the purchase of risk management coverage should rest solely with each individual farmer.

Members of the Delta Council committee involved in the endorsement agreement includes: Bruce Brumfield of Inverness, Miss., Bobby Carson of Marks, Miss., Kenneth Hood of Gunnison, Miss., Frank Mitchener of Sumner, Miss., Tom Robertson of Indianola, Miss., and Mike Sturdivant Jr. of Glendora, Miss.

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