Big savings claimed for on-line insurance
11 February 2000
Big savings claimed for on-line insurance
NEW internet-based insurance scheme, Farmshield, can save farmers up to 30% on their premiums, claims Northampton-based broker Hammon Osborne.
Main savings come from reduced administration costs, which can often account for a third of the cost of premiums, says managing director, Godfrey Hammon.
Farmers input information themselves, saving on site visits and lengthy form-filling exercises, he notes. But phone help and personal visits are available to help farmers get started.
"If we can reduce administration costs to 15% we can immediately pass on savings to the farmer," says Mr Hammon.
Reduced risk also helps cut costs, he adds. The scheme automatically targets computer users, which tend to be better farmers in the low risk sector. "If you get the top 60% of farmers, you will only have about 30% of the claims," says Mr Hammon.
Although internet insurance is not new – it already exists for car and household purposes – this is the first time a composite package has been launched, he adds. It provides one policy covering all requirements, with one renewal date. Premiums can be paid monthly or annually.
It includes coverage to set limits, calculated using farm revenue, which eliminates under-insurance problems, says Mr Hammon. Most mid-term changes of machinery or plant can also be included without having to notify the company, he adds. Items can also be added or removed as required.
Farmshield, although mainly aimed at the arable sector, will work for all types of farming business, says Mr Hammon. It will be launched at shows this year, and is also backed by several agchem distributors, including Framlingham Farmers, which helped develop the concept, Masstock, Star Group, Sands, and CSC Cropcare.
About 90 farmers have already joined, and Mr Hammon hopes to increase that to 300-400 this year. The scheme is underwritten by Royal & SunAlliance, and located at www.farmshield.co.uk *