I was hanging out in Midwesttown, USA the other day and came across a poster advertising an event held at the community center. The poster read: FIGHT NIGHT! Jimmythe Farmer v. Craig Crop Insurer in a 12 round winner take all bout. So I headed right over, laid down my money and walked in to a sold out fight. It was a good fight with both fighters standing toe to toe exchanging jabs, uppercuts and haymakers. In the end, Jimmy the Farmer won by a close decision from which Craig Crop Insurer immediately requested a rematch. Then I woke up, got dressed and went to work.Without a doubt, crop insurance disputes would be way more interesting if actually handled in the ring.
Considering the current drought may create a record $25 billion in crop insurance claims this year, community halls, civic centers and VFW’s would have a hard time scheduling all the potential fights. In the real world, crop insurance disputes are handled in a beauracratic quagmire of paperwork, phone calls and eventually arbitration.
Federally re-insured crop insurance policies require farmers to arbitrate their disputes with crop insurance companies according to the rules of the American Arbitration Association (AAA). However, the arbitration does not have to be handled by the AAA. Rather, the farmer and crop insurer can select their own arbitrator to hear the dispute, which may save money and provide more control over selecting the arbitrator. The USDA Risk Management Agency (RMA) recently submitted Bulletin No.: MGR-12-003.1 outlining the following steps for demanding arbitration if the AAA is not elected.
The process is initiated by filing an arbitration demand with the insurance company. The demand must include a short statement of the facts of the dispute and the policy provisions which the farmer believes provided coverage. The demand should also include the names and addresses of all parties, the amount disputed, and request the arbitration location. The insurance company must confirm receipt of the demand. The farmer and insurance company can then nominate up to 5 potential arbitrators upon which they must agree on one or more of the arbitrators. If the farmer and insurance company cannot agree on the arbitrator, the arbitration will be conducted through the AAA. Consequently, the parties should make a strong effort to agree on the arbitrator even if they cannot agree on anything else.
In the end, the arbitration process will mentally feel like 12 rounds. Therefore, it is important to have the right people working the corner.