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Memo of Understanding Issued on American Growers

As a result of a telephone conference PIA initiated among interested parties with the Nebraska Department of Insurance, PIA was able to identify a number...
December 23, 2002

As a result of a telephone conference PIA initiated among interested parties with the Nebraska Department of Insurance, PIA was able to identify a number of member needs to be considered as the Nebraska Department of Insurance and the U.S. Department of Agriculture's Risk Management Agency (RMA) developed their joint memo of understanding.

On December 12, 2002 PIA of Nebraska Executive Vice President Sharon Dooley advised members the resulting Nebraska DOI memo confirms that the Nebraska DOI and RMA are working with American Growers management to ensure that all outstanding policy claims will be paid and service to producers for 2002 policies will continue.

Also, PIA received RMA's companion memo on the subject, MGR-02-022, Procedure for Transferring Crop Policies Written Under the 2003 Standard Reinsurance Agreement from American Growers Insurance Company, and Its Policy-Issuing Companies

What It Means to Agents:  PIA was successful in confirming that the Nebraska DOI intends for agents to process their information, data and collected premiums according to the terms of the American Growers agreement that they signed.  This means that if your current American Growers agency agreement permits you to return premium on a net-of-earned commissions basis, the agency may do so for crop years that are closing.

Further, we raised the issue of a lack of market capacity in some states/markets, and the suggestion that RMA in these states needs to consider raising the cap ceiling for percentage in the assigned risk pool.

Please note that per the RMA bulletin, the 2003 fall book of business and remaining 2003 booked business with be transferred to the Approved Insurance Providers.  This must be completed by 01-31-03.

Your Action Needed:  Those states and members affected by this please be sure to read both the NE DOI and RMA memos.  Please advise PIA if there are outstanding issues still tobe resolved and/or if issues arise as a result of the Approved Insurance Providers transfers. If you need further information or you are experiencing regional, statewide or class capacity problems in placing renewals with other crop insurance providers, please contact Pat Borowski patbo@pianet.org

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