Crop insurance policies offer opportunity for mediation

ANNAPOLIS, Md. — Maryland’s agricultural mediation program, Agricultural Conflict Resolution Service, has been assisting Maryland’s producers in minimizing and dealing constructively with conflict since 2000.
The program is funded by the USDA and the Maryland Department of Agriculture to provide conflict resolution services ranging from mediation and facilitation, to training and information materials.
Federal Crop Insurance policies provide that mediation can be used as an opportunity to address disagreements between policy holders and their approved insurance providers.
The basic provisions of the Common Crop Insurance Policy (Section 20), and similar provisions in other plans of insurance contain information on requesting mediation with an insurance company.
The letter to the farmer denying the claim will include information concerning the opportunity to mediate.
Specifically, Section 20 states that if a producer disagrees with a crop insurance determination, mediation may be used to resolve the dispute.
Producers may also use mediation to resolve disputes for a variety of Risk Management Agency decisions. Although many issues can be mediated, there are some issues that cannot be mediated due to federal regulations governing the crop insurance program.
What is mediation? Mediation is a voluntary, confidential, problem solving process which includes the assistance of a third party (the mediator) by helping people in conflict resolve disputes by indentifying and clarifying issues, exploring options for settlement, and recording agreements. The mediator is a neutral and does not represent either participants.
If an agreement is reached in mediation process, the terms are written down and signed by both parties. The goal of the mediation is for participants to develop their own acceptable or agreed upon solution within the terms of the regulation and procedures governing the federal crop insurance program. The signed agreements are considered a binding contract on producers, AIPs or government agencies.
There are many advantages to trying mediation. Mediation can quickly resolve issues and streamline the government’s involvement. It is confidential. Mediators are neutral and help the participants find acceptable solutions or alternatives. The participants make the decisions and develop the final agreement, if any. Participation is the process results in the building of mutual respect and understanding as well as preventing future misunderstanding.
Those interested in requesting information concerning mediation, should contact Mae Johnson, Maryland Agricultural Conflict Resolution Service by calling 410-841-5778 or 410-841-5770 or e-mail This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
For example, Maryland ACReS received a request from a producer regarding a underpayment of an insurance claim dispute. Within one week, the program coordinator contacted the insurance provider to request their participation mediation on behalf of the producer. The insurance provider accepted the offer to participate in mediation and assigned a representative to participate in the mediation. A mediator was identified and the session was scheduled. During the session, the producer indicated that he felt that he had been treated unfairly because his neighbor had received a higher payment for the same type of crop loss. The insurance provider reviewed the documents supporting the claims requests and the reason for his payment. It was discovered that based upon the information presented to the company, the amount paid was correct. However, through further discussion, the producer learned that he had omitted some receipts that would have supported a higher claim. Since the end of the insurance period had not expired, the producer agreed that he would provide the additional receipts and the provider agreed (on behalf of the company) that his claim would be reconsidered. The actions to be taken by each person were noted in a written agreement with specific dates for completion for the claim. The agreement was signed by the producer and the insurance representative. (This did not provide a guarantee that the farmer would receive a higher claim amount since the insurance provider must abide by the agreed upon formulas for payment outlined in the insurance policy.) In this particular situation, the claim was adjusted in favor of the producer.
When the mediation does not result in mediation, the participants gain a better understanding.
The farmer gains a better understanding of the requirements of the crop insurance policy requirements and the insurer develops a better understanding of how to improve communication of the facts related to the policy. This results in a win-win for everyone.