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Watts and Associates Crop Insurance Division

Established in 2000, Watts and Associates, Inc.’s Crop Insurance Division was awarded one of just four Base Contracts by the United States Government, arising from the passage of The Agricultural Risk Protection Act of 2000. Since that time, Watts and Associates, Inc. has been awarded more than 35 contracts to provide agriculture insurance feasibility analysis, product development, or product review for the U.S. Government. The Division has also provided these services for entities such as the World Bank, the Canadian Government, the state of Montana, and private entities. These contracts have allowed Watts and Associates, Inc. to work on a vast array of crops from avocados and cherries, to maple syrup and Christmas trees, to silage and forage, each presenting its own unique challenges.

Watts and Associates, Inc. prides itself in not only the quality of work (100% acceptance of all contracts), but also on innovation. On several occasions, Watts and Associates, Inc. developed alternative approaches to risk management where seemingly no options existed to address the unique characteristics or limited production of the proposed crops.

Private Submissions of Government Subsidized Products
More recently, the focus of the Watts and Associates, Inc. Crop Insurance Division has been to assist producers, producer groups, and various stakeholders in the agriculture market to navigate the 508(h) process for crop insurance reform and development. Watts and Associates, Inc.’s experience and expertise in the crop insurance review and development arena places us in a position to assist and advise various entities in choosing the direction they wish to pursue in attaining their agriculture related goals and objectives.

ARPA 508(h) - One of the mandates included in the Agricultural Risk Protection Act (ARPA) of 2000 was spelled out in an amendment to section508(h) of the Federal Crop Insurance Act, creating a process under which private groups – farm organizations, insurance companies, and others – could present new insurance concepts to the FCIC Board and, if approved, have them incorporated into the Federal crop insurance system, eligible for subsidy and reinsurance. The private group, in turn, could then be reimbursed for the costs entailed in developing the product and maintaining it after the product had been approved. Watts and Associates, Inc. has successfully worked through this process to develop numerous products for clients in the both private and public sector. This process supports the introduction of new and revised products into the marketplace under the fastest possible timeline.

Farm Bill 2008 - 508(h) - In 2006, Watts and Associates, Inc. in conjunction with multiple producer groups, embarked on an effort to bring effective and efficient change to the 508(h) process. Watts and Associates, Inc. hired the Ken Ackerman and Olsson Frank and Weeda Law Firm to spearhead this effort. This successful effort resulted in an amendment to section 508(h) of the Federal Crop Insurance Act to facilitate the development of new insurance products by producer groups working with developers. Under this new process, applicants (private groups – farm organizations, insurance companies, and others) can develop a Concept Proposal, present it to the FCIC Board, and receive a portion of their estimated development costs up-front to assist, financially, in bringing the concept to complete development. Watts and Associates, Inc. fully expects these new rules to open the crop insurance market to additional innovative and cost efficient products for producers.

The reform of the 508(h) process championed by Watts and Associates, Inc. for the 2008 Farm Bill, and written into law under Section 12022. Research and Development of the Food, Conservation, and Energy Act of 2008, addressed concerns with the 2000 ARPA 508(h) process by making it more user-friendly to outside producer groups while giving the FCIC Board greater authority to control its agenda. While this new process has more steps than the previous 508(h) process, the potential for advanced reimbursement of expected costs is expected to make crop insurance development much more accessible to producer organizations.

Contact Alex Offerdahl, Crop Insurance Division Lead or Ken Ackerman, council with Olsson Frank and Weeda Law Firm, at 406-252-7776 for information on these types of submissions.

Watts and Associates, Inc. - Economic Consultants