Drought Holds Steady in Midwest, Clouding Winter Crop Outlook

October 12, 2012Email ThisPrintNewslettersTweetArticleComments

The nation’s worst drought in decades showed no signs of improvement last week in parts of the Midwest and Plains where the corn harvest is about two-thirds complete, clouding the prospects for the winter wheat crop, according to a drought report released Oct. 11.

The U.S. Drought Monitor’s weekly update, showing that nearly two-thirds of the lower 48 states remained mired in some form of drought, was released the same day the federal government lowered for the fourth month in a row its projection for the size of this year’s corn crop.

The USDA now estimates that farmers will harvest 10.71 billion bushels of corn, down from last month’s estimate of 10.73 billion bushels. The average yield is about 122 bushels per acre, off from July’s projection of 122.8 bushels.

The dry conditions remained unchanged in Iowa, the nation’s biggest corn producer, with three-fourths of the state still in the extreme or exceptional drought

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New Jersey Holds Its First Captive Insurance Summit

September 21, 2012Email ThisPrintNewslettersTweetArticleComments

New Jersey regulators held their first captive insurance summit this Wednesday in Somerset, N.J. The event, hosted by the state’s department of banking and insurance, attracted some 50 industry executives.

Regulators took the opportunity to discuss New Jersey’s captive law and regulations, the admission process, and emerging captive trends and issues.

The department of banking and insurance stated that since New Jersey Governor Chris Christie signed the captive law into effect in 2011, the department officials have taken an active approach to fostering growth in the captive insurance marketplace.

The Wednesday’s event included two panel discussions. The first panel focused on the specifics of the New Jersey law, the admissions process and what potential applicants can expect when starting a captive insurer. Some of the topics discussed included reviewing the captive structures that fit the needs of an interested party; re-domestications; interactions with the regulators; the application and formation process; choosing service providers; timing and other expectations; and final approval/certification by the department.

The second panel discussed national issues faced by captive insurers and their owners. Some of the issues discussed at the panel included: employee benefits; international events; reputational risk; the Nonadmitted and Reinsurance Reform Act (NRRA) and state self-procurement tax; the hardening insurance market; cyber risk coverage; and Terrorism Risk Insurance Act (TRIA) risk.

Since the state’s captive law was signed into law, four captives have been approved by regulators. Kenneth Kobylowski, acting commissioner of the state department of banking and insurance, said at the event that eight prospective captive insurers are now in the pipeline. “There is no question that this is just the beginning,” he said.

Kobylowski also told attendees that a growing number of companies are thinking about forming captives to gain greater control of their ability to identify, manage, and finance insurable risks.

 

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