hydroponic/urban farms the changing face of the agriculture industry

Webinar

Hydroponic/Urban Farms The Changing Face of the Agriculture Industry

Today’s Agenda

Intro to NIP Group Industry Overview

Specific Challenges faced by Greenhouse Growers, Nurseries, and Garden Centers

Benefits of Specialized Coverage

Today’s Agenda

Overview of the GrowPro Program

Things to Look For, when preparing a submission

Summary Q&A

About NIP Group

Provide a wide range of brokerage,

underwriting, and risk management services

A “top 100” business insurance and risk

management intermediary

Top 100

Entrepreneurial, innovative, and responsive

Deep knowledge of key markets

20+ years of providing agents with exceptional coverage,

competitive commissions, and fast, efficient service

About NIP Programs

Develop and manage customized business insurance for industries with specialized insurance and risk management needs

Custom-tailored coverage for select markets


Unique underwriting, loss control, and claims service models, valued by both

clients and insurers


Underwritten by major insurers such as Travelers, AIG, Argo, AmTrust


Market-specific expertise


Stability through all market cycles

Programs

Arborists and Landscaping Professionals

Programs

Pet Care Professionals

Programs

Heating, Ventilation, and AC Contractors

Programs

Lawn Care Services

Programs Employment Practices Liability Insurance

GlassPro® – for Glass Dealers and Installers

GrowPro® – for Greenhouses, Garden Centers and Nurseries

HVACPro® – for AC, Refrigeration, Heating or HVAC Contractors

IrrigationPro™ – for Providers of Irrigation and Pesticides for Lawns, Crops and Golf Courses

InteriorScapePro™ – for Contractors Providing Indoor Landscaping and Plant Maintenance

LandPro®/TreePro™ – for Landscapers and Tree Services Providers

LawnCarePro™ – for Lawn Care Service Providers

LightScapePro™ – for Lightscaping Contractors

MaintenancePro® – for Cleaning and Maintenance Services

MedEdge® – Affinity program for Physician Assistants and Optometrists

PetPro™ – for Pet Care Professionals

PlumbingPro® – for Commercial Plumbing Contractors

PowerPro® – for Electrical Contractors

SignagePro® – for Sign, Display and Awning Companies

SitePro® – for Excavation, Site Prep and Paving Contractors

WorkPro – Workers’ Comp

Industry Overview

Greenhouse Growers Nurseries Garden Centers

Major Segments

Compelling Market Opportunity

• Attractive niches across three distinct segments

Large, highly-varied and fragmented market

• Premium ranges by sub segment between $25,000 and $45,000.

Target Market represents more than $1.3 billion in premiums

Target market represents nearly 50,000 businesses nationally

Large market size enables a selective underwriter to quickly build a large program ($25M +)

Profitable Class Underwriting Profile

Profitable nationwide underwriting results for class of business

Known and controllable underwriting exposures with attractive niches

Property and GL-Driven class of business

Industry Overview Green Industry represents nearly

250,000 businesses with > $150 Billion of annual receipts

Employs 1.2 million and generates > $3.6 billion in insurance premiums annually. 1, 2

Market Size Target accounts primarily in grower

and seller (AKA producers and retailers) segments, commonly referred to as Independent Garden Centers, Greenhouses and Nurseries.

We target accounts of all sizes, from neighborhood garden centers to multi-million industrial greenhouse operations

Represents more than 50,000 businesses nationally that generate > $1.3 billion in premiums.

Source: 1. Economic Impacts of the Green Industry – USDA 2005 2. ISO Data

Key States Top Ten States: California,

Florida, Texas, Oregon, New York, Illinois, Michigan, Pennsylvania, New Jersey, and Ohio.

We write in all states, except FL (property) and parts of MA (auto)

Outlook This industry continues to be

one of the fastest-growing sectors in the nation’s economy with growth rate exceeding the GDP

Segment Relationship

Nurseries Nurseries are places where plants are propagated and grown to usable size. They are usually independent commercial growers, with or without greenhouses. They typically have a mix of retail and wholesale.

Greenhouses Greenhouses focus on the large-scale production of floricultural products, and represent a significant premium. They are generally wholesale operations with unique property exposures (greenhouses, related equipment) that are often not properly addressed by non-agriculture insurance programs

Independent Garden Centers Independent Garden Centers run from the local “mom & pop” operation to larger, regional centers, with a primary focus on Retail.

Landscapers & Tree Services Independent Garden Centers run from the local “mom & pop” operation to larger, regional centers, with a primary focus on Retail.

Hybrids Hybrids create opportunities for our program because the traditional underwriting approaches of most national and regional carriers are not designed to accommodate the unique exposures of these multi-faceted operations.

NIP’s GrowPro®

An Overview

Greenhouse Growers

Wholesale Greenhouse Growers

A Wholesale Greenhouse Grower grows ornamental flowers, plants, shrubs, and trees in controlled environments.

The grower typically has much higher property values than the nursery grower, along with specialized equipment inside of the greenhouse structure.

Large growers typically supply plants to big box stores, or on a consignment basis, with significant exposure for stock at non-covered locations.

Nursery Growers

Wholesale Nursery Growers

A Wholesale Nursery Grower generally grows plants and trees in open fields.

We offer limits of up to $250,000 for stock in the open, on a Special Form basis, including wind and hail damage.

Retail Garden Centers

Retail Garden Center are the major customer of the Greenhouse and Wholesale Nursery Grower.

In addition to flowers , trees and plants, they typically sell fertilizers, seeds, supplies, and small garden tools.

Garden Centers often have greenhouse structures to house plants held for sale.

They often have a landscaping division, which presents a unique and different exposure from the typical greenhouse or nursery operation.

NIP’s GrowPro®

An Overview

The Solution

The Complete Coverage Solution Commercial

General Liability Property Contractors’ Equipment Crime

Business Auto Umbrella Workers’ Comp (via WorkPro)

GrowPro Coverage • Coverage for buildings,

greenhouses and stock for losses including fire, collapse, windstorms, hail, failure of utility services, and boiler or equipment breakdowns.

• Coverage limits can be tailored to seasonal fluctuations of crop and inventory

• Market value coverage on losses of greenhouse crops and stock held for sale

• Replacement cost coverage on production equipment that’s permanently installed.

• Coverage for business inventory in transit including spoilage coverage for refrigerated inventory while in transit due to refrigeration breakdown

• Coverage for losses of business income for covered perils that interrupt a crop cycle or prevents a new growing cycle during the period of restoration.

Program Highlights

GrowPro Coverage • Coverage for outdoor plant

inventory held for retail sale up to $250,000, including damage from wind and hail

• Pesticide/Herbicide Applicators Liability coverage for operations involving off-site application of chemicals

• Flexible coverage can be tailored for hybrid operations: − Wholesale greenhouse growers that also

have retail garden centers

− Wholesale Nurseries that have landscaping divisions

− Garden Centers that have their own greenhouse or nursery growing facilities

• All lines of coverage, including Property/Liability, Business Auto, Workers Comp, Umbrella, and Nursery Crop coverage

• Assistance with proper valuation of greenhouses − GrowPro considers the value of equipment within

the greenhouse structure – in establishing the replacement cost of the greenhouse

− Boilers, generators, cooling equipment and watering systems, etc.

Program Highlights

GrowPro Coverage

Program Highlights

• Coverage for sudden and accidental breakdowns, including power line surges, overloads, short circuits, motor burnout. − Costs associated with losses to

building equipment such as costs to repair or replace equipment damaged by breakdown

− Costs or expenses to limit business income loss or speed of business restoration.

Equipment Breakdown

• Coverage for damage to perishable stock for losses due to temperature change

• Covered perils include power failures and mechanical breakdowns. − Option to increase limit up to $250,000 − Back-up power systems and temperature

controls required

Spoilage

GrowPro Coverage Enhancements Seasonal Fluctuations of Crop or Inventory

• Can be tailored to accommodate higher stock values during “peak” seasons

• Covers losses for covered perils that interrupt crop cycle and/or prevents new growing cycle during restoration period.

• Provides coverage for cleanup and removal of pollutants resulting from the insured’s application of pesticides and herbicides.

• Coverage applies to both on- and off-site operations

Business Income / Crop Income

Limited Pollution Liability

Program Highlights

Business Income/ Damage to Dependent Locations

Program Highlights

Holes in Coverage

− Damage to dependent locations, i.e. “big box stores” may result in significant loss of sales income

− Does current BI insurance coverage include dependent locations?

Program Highlights

− Damage to equipment that maintains controlled growing environments can result in significant losses…

− Are your clients covered for such damages and the potential damage it may cause to their stock?

Equipment Breakdown / Spoilage

Holes in Coverage

Program Highlights

− Are they covered at all?

− Replacement cost?

Greenhouses

Holes in Coverage

Program Highlights

− Many carriers have sub limits for wind and hail damage, if they cover it at all.

Stock in Open

Holes in Coverage

Program Highlights

− Many large greenhouse/nursery operations provide stock to big box stores on consignment. Do current policies cover this exposure?

Stock Away From a Covered Location

Holes in Coverage

Program Highlights

− Many carriers will not write habitational dwellings on their commercial form, requiring a separate policy

Habitational Dwellings

Holes in Coverage

Other Considerations

Admitted vs. Non-Admitted Carriers GrowPro is underwritten only by Admitted carriers with “A” ratings by A.M. Best

• Only covers insured for operations specifically described in the description of hazards section of GL policy

Classification Limitation Endorsement

• Markets have occasionally reduced it to 90%, even 80

GL is usually 100% minimum earned

Submission Requirements

• Completed ACORD application • Completed GrowPro

Supplemental Questionnaire • 5 Years Currently –

Valued Loss Runs • Current MVRs

(ability to quote subject to) • Declinations • Target Pricing

Package

Need complete submission, to review all risks

• Description of Safety Initiatives, hiring practices, return-to-work, and drug-testing programs

• Exp. Mod. Worksheet (if available)

Worker’s Comp

Supplemental Application

Importance of Providing Key Information

A basic diagram of the property layout is an excellent tool for everyone involved and is appreciated by the insured.

Pay special attention to property section

• Most GrowPro accounts have a variety of building types, including greenhouse structures which vary in construction type, roof covering and in value

• We can provide coverage – per location – on a blanket basis, but will require a schedule of values for each building

Replacement cost of greenhouse structures can range from $5 to more than $30 / sq. ft.

• We will provide assistance in establishing adequate property limits.

Replacement cost of greenhouse structures can range from $5 to more than $30 / sq. ft.

• For establishing proper limits for stock and business income

Types of crops grown? Typically flowering plants, bedding plants, poinsettias, hanging baskets

Property Section

− We will not insure fruit or vegetable growers or distributors.

Number of growing cycles per year?

Property Section

− How long to resume normal operations following catastrophic loss?

Maximum value of crop during peak growing season?

Property Section

− To determine proper limits for crop, i.e. spoilage from equipment breakdown

Is there a backup generator capable of supplying 100% of facility’s power requirements?

Property Section

− Mandatory

Is there a temperature control alarm system to warn of changes in temperature within the greenhouse?

Property Section

− This is typical for greenhouse growers. If not, why?

Does client or responsible party live on or adjacent to the premises?

Property Section

− Quick response to control losses

Does client utilize walk-in coolers for the storage of perishable stock?

Property Section

− If yes, what is maximum value of the refrigerated stock?

− Use standard spoilage form to insure to maximum value of refrigerated stock.

Property Section

Is shade cloth/energy curtain at least 2 feet from ignition sources?

− Verify location of shade cloth, distance from possible ignition sources

− Highly flammable, can allow fire to spread rapidly

− Discuss measures grower has considered to reduce risk − i.e. flame resistant cloth, fire breaks, fire extinguishers, etc.

Property Section

Are chemicals properly labeled, stored in locked room/cabinet?

− Growers required to have chemicals labeled and locked in properly ventilated storage room or cabinet.

Property Section

Do potting machines, transplanting machines, and other hazardous greenhouse equipment have proper guards or shields in place? − Don’t forget Personal Protection for

employees (gloves, ear muffs, glasses)

Greenhouses

Tempered Glass

Barrel-Vaulted Double Poly

Quonset-Style

Gutter-Connected Gable with Polycarbonate Roof

• Over 20 years of green industry experience

• Custom coverage designed to fill gaps left by standard programs

• Expert claims handling from a dedicated claims director

Why NIP?

• Experienced underwriters who understand your client’s business

• Flexible payment plans

Submission Requirements

NIP’s GrowPro® Program

Package Worker’s Comp • Completed ACORD application • Completed GrowPro Supplemental

Application • 5 Years Currently-Valued Loss Runs • Current MVRs

(ability to quote subject to) • Declinations • Target Pricing

• Description of Safety Initiatives, hiring practices, return-to-work, and drug-testing programs

• Exp. Mod. Worksheet (if available)

Summary

• Break into 5

GrowPro Provides:

Outstanding coverage, tailored to specific needs of Greenhouse Growers, Nurseries, and Garden Centers

1 AM Best A Rated (Excellent) Carriers (Company Size XV)

• Break into 5

GrowPro Provides:

Strength and reputation of “A” rated carriers1

• Break into 5

GrowPro Provides:

Backed by nearly 25 years of experience in providing specialized programs tailored to the unique needs of select classes of business

• Break into 5

GrowPro Provides:

Stability through all market cycles

• Break into 5

GrowPro Provides:

NIP awarded “Best Practice Designation” by TargetMarkets

Questions?

Thank You!

Dan Skerston [email protected]

(800) 446-7647 x 762

Craig Murphy [email protected]

(800) 446-7647 x 664

mailto:[email protected]?subject=GrowPro Question from Webcast

mailto:[email protected]?subject=GrowPro Question from Webcast