 | |
| HomeMembership ResourcesEducation/EventsInsurance MarketsInsurance For AgentsNewsAbout Us | |
| Conferences/CE ClassesYIPLogin | |
 | Crop / Hail |
 A Member Service of PIA of North Dakota www.PIAND.com 2-13-2012 2012 WILL BE A CHALLENGING YEAR: Insurance companies, agencies and our industry will be dealing with a number of issues in the coming year that will need special attention. The hard market is still a few years away and growth in our economy is years away so growth in our industry will be slow. Companies will be focusing on underwriting fundamentals. Agents need to prepare for underwriting changes. Some companies will exit unprofitable lines, agencies or states. Companies will sooner toughen underwriting or exit a market than raise rates. Agents need to get ahead of constrictive underwriting by ‘cleaning up’ their book of business. Agents cannot afford to risk placing unprofitable or substandard risk with their agency’s preferred companies. Having a market will be more important than having an account! Knowledge, training and experience of the agent and all personnel will be one of the most important issues in the next few years. Hiring, training and retaining top-notch employees will be paramount. Employers need to constantly train and educate their staff concerning company underwriting changes or coverage issues. “Stick to what you know and what you do best” and “stay in your area of expertise” is the advice currently offered in the industry. “If you sell by price, you’ll pay the price” say the growth experts---you are really not growing but dying. P/C RATES INCREASE IN JANUARY: The property and casualty industry’s rates were up an average of 1% in January according to MarketScout. The January increase matched the 1% December increase. Workers comp exhibited the largest increases at 2% while all lines were up or flat. Business interruption was up 1% in December and up 2% in January. Small accounts were up 1% in January compared to 2% in December while medium accounts were up 1% in December and 2% in January. Large accounts and jumbos were unchanged. A fourth quarter survey found that average premium rates increased nearly 3% for the last three months of 2011 which is a 1% per month average or a 12% annual increase if the monthly trends remain. IRS MILEAGE RATES for 2012: The Internal Revenue Service has set the 2012 standard mileage rate at 55.5 cents per mile for business miles driven. The rate for medical and moving purposes is 23 cents per mile and 14 cents per mile for service to charitable organizations. The rate is unchanged from those set last July 1, 2011 for business miles driven. The medical and moving allowance has dropped by 0.5 cents in 2012. Taxpayers have the option of calculating the actual costs of using their vehicle for business purposes rather than using the standard mileage rate. A taxpayer may not use the business standard mileage rate for a vehicle after using any depreciation method under the Modified Accelerated Cost Recovery System [MACRS] or after claiming a Section 179 deduction for that vehicle. Contact your accountant or CPA for any questions regarding depreciation and mileage deductions. YOU’VE HEARD IT BEFORE: Here it is again. Amongst all the debate on the deficit and the 2012 Farm Bill budget, the total baseline mandatory spending for AGRIGULTURE is $15 billion which amounts to about 1/3 of ONE PERECENT of the US Budget. The Congressional Budget Office [CBO] projects an average of $16 billion per year for the next ten years—out till 2022. The total US Government commodity program payments to farmers in 2009 was $12.3 billion. This is chaff—remember there is a thousand billion in a trillion and our national debt is approaching 15 trillion [15,000 billion]! MEXICO LIKES CROP INSURANCE: The Agriculture Ministry plans to help their farmers buy crop insurance against natural disasters on 9.4 million hectares [23.2 million acres] of crop in 2012. The Mexican farmer’s risk is for freezing and drought; 1.34 million hectares [3.31 million acres] of crops and 50,000 head of livestock were lost in 2011. About 16% of land in Mexico is covered by Mexican crop insurance. By comparison, between 85-90% of eligible acres in the US are covered. EXPIRING CRP IN 2012: North Dakota has approximately 815,000 acres of CRP expiring in 2012 while Minnesota has an estimated 550,000 acres expiring in the next three years. North Dakota has dropped from 3.3 million acres in the ‘80s to about 1.1 million acres in 2012. Texas has had the most CRP acres [3.8 million acres] followed by Montana [3.21 million] and Kansas [3.1 million] but these acreages are rapidly expiring. | |
|
Membership Resources | Education/Events | Insurance Markets | Insurance For Agents | News | About Us | Conferences/CE Classes | YIP
Professional Insurance Agents of North Carolina PO Box B, Henderson, NC 27536 877.401.6822 Penny.Rose@piaofnc.com or 877.987.4262 Jim.Kennedy@piaofnc.com |
|