Hemp insurance seed to sale.

1. Hemp Risk Management
Serving your insurance needs since 1925.

2. • (YOU)Farmer A has been growing CBD for 3 years and grew from 10
acres - 500 and that fourth year farm B 5 miles down the road
plants fiber. What do you do with all that time and money invested
in outdoor CBD operation? other then find out all your inputs will
be ruined if you plant..
• Be sure to consider the future when jumping into hemp
Think about the future
2

3. Multiple end uses evolving the industry with experimental:
Varieties (CBG, CBD,CBN, CBC, FIBER)
Production practices
Harvest and drying methods (Hempwood, Hempcrete, Paper Products)
Lack of standardization within the industry & regulators availability of data used to establish:
Rates
County T-yields
Prices
Challenges to Program Development
3

4. Protection you NEED to consider
Farm
Owners
Protect your daily farm
operations and
homestead.
Crop
Insurance
Protect your commodity
when its in the ground.
Business
Owner
BOP is perfect for CBD
retail shops.
Surety Bond
A bond is required for
processing in Ohio.
Commercial
Insurance
Product liability is very
important let us help get
you covered right.
4

5. Surety Bond
1. Processors need to obtain a surety bond. This can be
done through an insurance agent. All licensed processors who
purchase raw, unprocessed hemp must demonstrate their
financial responsibility in the form of a surety bond. The bond
must be in the amount of either $10,000 or $20,000 and meet
the requirements found in OAC 901:14-2-07.
5

6. Farm Owners
Product Coverage
Get Coverage on
Mothers, Clones,
seedlings and harvested
product.
Equipment Breakdown
Protect your indoor
operation.
Property & Liability
Coverage
Get everything a
traditional FOP offers
but with HEMP
included.
6

7. Covered Causes of Loss & Scheduled Hemp (Indoor only)
• Fire Or Lightning
• Windstorm Or Hail (outdoor fiber bale soon?)
• Explosion
• Riot Or Civil Commotion
• Aircraft
• Vehicles
• Vandalism- (no coverage unless seed)
• Theft – (no coverage unless seed form)
• Sinkhole Collapse
• Collision
• Falling objects
7
A few examples of coverage:
• Fire takes out your barn or green house holding
mothers, clones or harvested hemp
• Wind takes out electric and mothers, clones or indoor
plants don’t get the light that is needed
• Transporting your product and hit by another driver. The
hemp goes everywhere. You have coverage as long as
your within a 75 mile radius.

8. 8

9. 9

10. 10

11. 11

12. 12

13. 13

14. 14

15. 15

16. 16

17. 17

18. 18

19. 19

20. Crop Insurance
Whole Farm
Revenue Protection
Based on Tax returns and
operation cost.
MPCI
Multi-peril Crop
Insurance.
Private
Product
Hail and other coverages
not offered by RMA.
20

21. 21

22. 22

23. 23

24. o APH basedplan,coveringreducedyieldswithstandardlistof perils.
o SCD – 3/15, extending2/28to 3/15 for2020 only;Cancellationdate will be 3/15 or 2/28
dependingondates. PRDwill be 4/29 basedon extended
o Dates:
 June 15-July20th
final plantingdate,dependingonstate.
 ARD 8/15
 Billing10/1
 EOI 10/31
o CBD, FiberandGrain – typesallowed
 Transplantor directseededonCBD
 Requirednumberof acres:CBD5 acres minimum;fiberandgrain20 acre
minimum
o Coverage levelbytype and50-75%, Price Electioncan be lessthan100%
 CAT isavailable
 CPA cannot be usedto gaincontract price over RMA price
o Unit Structure – OU, BU and EU
o COL not covered – Mandatorydestruction,quality, failure tofollow processorcontract
provisions,failure tomarket,seedcontamination.
o Replant,PPor WA’snot available
o Must be licensedbyauthority, mustprovide productionevidence foratleastone year.
o Must have processorcontract. RMA will setthe price,regardlessof contractprice
o New producerprovisionsare notapplicable.
o Yieldadjustmentsare notavailable includingYieldFloorandCup
 Hot hempwill have acresandno yieldandproductioninthe aphdatabase
o Rotationrequirements:Cannotfollow:Cannabis, canola, drybeans,drypeas,mustard,
rapeseed,soybeans, orsunflowers
o Inspectionwillbe neededpriortoharvest,if cropisnot hot
MPCI Program Highlights
24

25. • If the insured harvests the acreage without AIP consent and
the crop tests above the acceptable THC levels requiring
destruction of the crop, the acreage is considered destroyed
without consent and:
No indemnity will be due; and
A zero yield will be recorded in the APH database the
following CY using an “A” yield descriptor.
Premium is due
Insured Loss(THC Unknown at Harvest)
25

26. Private Product Crop Insurance
What type of
Coverage as a Hemp
farmer I can get?
• Drought
• Excess heat
• Hail (RCIS?)
• Excess Precipitation
• Flood
• Wind Cover
• Frost Cover
• Tornado
• Wildfire (regional)
• Earthquake (regional)
26

27. • Doesn’t qualify for WFRP or MPCI. Farmer invests significantly more money into each acre for Hemp
growth, and would like to cover those additional expenses.
• Investor requires Crop insurance as an additional layer of protection against their investment.
• Biomass has been presold either as part of an “Offtake” contract or a “Purchase Order” so the client buys
the insurance as kind of a “Business Income” protection which affords them the opportunity to use the
proceeds from a covered loss to purchase the BioMass they need to fill the order for a client.
• Weather stations are placed on the farm to track the below coverages, and the Farmer has access to that
same data to help them understand the unique exposures and timing of adverse events.
Private Product Crop Insurance
27

28. Business Owners Insurance (BOP)
For the retail shop.
Protection for all
major property
Business Owner
Liability
Protection for all
major liability
Additional
Coverage
Electronic Data, Outdoor
Signs, Business Personal
Property, Money &
Securities
28
Business Owner
Property

29. CBD Retail Shop - $902 for the year
29

30. Commercial Insurance
Commercial insurance is a good option for processors or other industry leaders who don't qualify for a FOP or BOP
Liability & Property
Coverage
• Commercial GL and PL
is business insurance
coverage that
provides property and
general liability insuran
ce to businesses who
aren’t eligible for a BOP
Commercial Auto
• Commercial auto
insurance is liability
and physical damage
protection for vehicles,
such as cars, trucks
and vans, that are
used for business
Product Coverage
• It’s only a matter of
time before harmed
consumers start
suing CBD
companies alleging
defective,
dangerous, or
mislabeled products
30

31. • Customer buys your CBD product and as he checks out he
asked your employee WILL I FAIL A DRUG TEST? Your
employee tells him NO. A week later that same customer
gets drug tested and looses a job they had for 20 years.
What would you do with no coverage?
31

32. • General Liability: Farmer has a seed dealer stop at farm. When talking in the shop the seed dealer slips on oil
and falls breaking his arm.
• Product Liability: Processor Makes a bad batch of CBD and the general public gets sick.
• Property: Barn Fire that had mothers, seed, clones or harvested hemp flower in it.
• Equipment Breakdown: Windstorm takes out power lines and leaves your mothers with no lighting.
• Crop: Hail storm
• Hemp could be a exclusion on your current policy if so any claim could be denied.
Examples Of Hemp Claims
32

33. Questions For Your Insurance Agent
If your on a Farm Owners:
• Does my FOP cover Hemp?
• If yes, What does it cover? is there general liability ,product
liability and property coverage for hemp? If NO, Call us @
740-986-4871. We will get you insured.
• If I have a fire and the building has products like clones,
seed and mothers is that covered?
• If NO CALL US!
• Do I have commercial auto coverage?
• If yes, Will they cover hemp product and transportation? If
no, Is there a endorsement that can be added to a CA for
hemp? Or Just call us!
If your on a Home Owners:
• Does my homeowners cover hemp?
• If no call us!
• If my home has a fire or a liability claim and I’m growing
hemp on my property will the claim be denied?
33

34. Summary
Choose Metzger Insurance for your hemp
insurance needs.
• Be sure to get with your local FSA office. You need to
start getting production history if you’re a new
producer. It is also required for your hemp permit.
• Get your background check
• Have a buyer or distribution in place.
• Separate your operation if your seed to sale. This will
spread out your risk and get the best coverage
possible with the lowest premiums.
• Product Liability is very important
• Crop Insurance for hemp is still being developed but
we have outlets
• We have a great FOP for your indoor grows
• Processors need a surety bond
34

35. Thank You
Chance Sowers
+1 740 986 4871
chance@metzgerinsuranceagency.com
metzgerinsuranceagency.com