A flexible deductible that can help you lower premiums for farm clients.
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Farm Flexible Deductible
Many farm and ranch customers are facing rising premiums and complex economic times. Farm Flexible Deductible can give them the opportunity to save money while still protecting them from worst-case scenarios.
What are the benefits?
Farm Flexible Deductible can:
- Help you match deductibles to risk tolerance
- Lower premiums so clients can reinvest savings back into their farms
- Allow clients to plan with confidence having a threshold for their out-of-pocket insurance costs
- Reinforce your role as a trusted advisor with smart, customizable solutions
What are the details?
Farm Flexible Deductible can allow customers with a Farmowners policy to choose a higher-than-standard deductible — between $25,000 to $1 million — in exchange for a premium discount.
Unlike a standard policy, in which a deductible applies to each individual loss, the Farm Flexible Deductible sets one total deductible amount that applies to property losses across policies for the entire policy term.
Set the deductible:
You work with your client to select a total property deductible amount for the year (e.g., $25,000).
Track the claims:
When a covered property loss occurs, the client pays the expense out of pocket. That amount is then submitted as a claim and applied toward meeting the total deductible.
Meet the deductible:
Once the sum of these submitted claims reaches the selected deductible amount, coverage kicks in to pay for subsequent covered losses for the rest of the policy term.
Only available in Ohio, Iowa, Pennsylvania, Nebraska and Kansas. Underwriting guidelines apply.
It's important to note that:
- A minimum claim threshold of $2,500 must be reached to count toward the deductible
- A maintenance deductible of $2,500 per claim applies after the policyholder has paid out of pocket up to the deductible; then Nationwide® will cover the remaining cost of claims
Is it a good fit for your client?
Determining whether Farm Flexible Deductible is a good option for your client involves a variety of considerations. This insurance feature may be best suited to larger farms with low debt-to-asset ratios where upfront claims costs can be more easily absorbed and for customers who want to keep more capital invested in their farm.
You and your clients should also consider their:
- Financial readiness
- Risk tolerance
- Claims frequency
- Cost-benefit analysis
- Coverage access
Farm Flexible Deductible can be an option to present at policy renewal as a potential solution for customers looking to manage rising premiums. Reach out to your underwriter for possible quote options prior to renewal issuance.
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Insurance terms, definitions and explanations are intended for informational purposes only and do not in any way replace or modify the definitions and information contained in individual insurance contracts, policies or declaration pages, which are controlling. Such terms may vary by state, and exclusions may apply. Discounts may not be applied to all policy coverages.