MORRISON OFFERS TIPS FOR HAIL INSURANCE CLAIMS IN WAKE OF SEVERE THUNDERSTORMS
Farmers Almanac predicts active storm season for remainder of summer
The recent thunderstorms that pounded eastern Montana should serve as a reminder to crop producers to check hail insurance coverage for their 2007 crops. Last week’s hail storms caused damage to thousands of acres of cropland in eastern and central Montana. In addition to strong winds and hail, about two and a half inches of rain reportedly fell in some of the hardest-hit areas. As a result, fields are so muddy that producers are not able to get out into the croplands to assess the full extent of the damage.
“With cash crops at record-high prices, crop insurance is an essential part of the safety net for Montana ag producers,” said State Auditor John Morrison. “Producers who sustained damage from the recent hail storms should contact their agent as soon as they can accurately assess the damage.”
According to the National Weather Service, about 4,800 hailstorms strike the United States every year. Of these, probably 500 to 700 produce hailstones large enough to cause damage or injury. These devastating storms can sweep across a field destroying all crops and vegetation in a matter of minutes. Worldwide, annual crop losses from hail represent about 1% of the total annual agricultural production. But in the U.S. Grain Belt, hailstorms destroy about 3% of crops grown each year. In response to the risk of hail, many farmers carry hail insurance.
The federal crop insurance program is a public-private partnership that provides producers with essential tools to manage the risks they face. Congress first authorized federal crop insurance in the 1930s to help agriculture recover from the effects of the great depression and the dust bowl. In the event of a severe hailstorm, hail insurance can help producers recover economic losses even though the crop may be completely destroyed.
Documenting damage is important when making a claim in hail settlements. To document damage after a storm, the 'after picture' should be collected as soon as possible. This is important because depending on storm extent and number of claims, plant re-growth may occur before the hail adjuster arrives.
“These days, Montana producers are checking their fields nearly every day, wondering what the weather will bring between now and the end of harvest,” said Morrison. “Summer thunderstorm season increases that uncertainty. If you do see damage, what you do, and what you don’t do, can have an impact on your crop insurance protection.”
As the state’s Commissioner of Insurance, John Morrison offers the following advice for insured producers with damaged crops. For most types of crop insurance policies, there are two good rules to remember:
1. Contact your crop insurance agent as soon as you are aware of any damage. The policies call for you to provide “written notice to your crop insurance agent” (by crop and by farm).
2. Do not destroy any of your crops until the adjuster or an insurance company representative has inspected the field and released the acreage. The basic provisions of crop insurance policies typically require that, in case of damage to any insured crop, you must give notice, by unit, within 72 hours of your initial discovery of damage and this must occur no later than 15 days after the end of the insurance period. If you initially discover damage to any insured crop within 15 days of, or during harvest, you should ask your crop insurance agent what you need to do to continue farming. You MUST have approval from your insurance company before destroying any acreage or unit. Upon receiving your Notice of Damage, your insurance company may assign your file to an adjuster to perform an inspection. The adjuster will likely contact you to discuss your situation and to schedule a time for inspection.
“According to The Farmers Almanac, we will likely see an active storm season for the remainder of this summer,” said Morrison. “But accurately predicting when and where a hailstorm will hit is like trying to predict the next winner of the World Series – you just don’t know.”
Montanans needing insurance information or assistance can contact the Montana State Auditor’s office at 1-800-332-6148. “If you believe you have been treated unfairly in getting a claim paid, please contact the Policyholder Services department of my office,” said Morrison. “We have a team of advocates on staff that can help you through the claims process.”