FAQs


Accounting

How does GARS treat Manufacturers Rebates?

All rebates from suppliers will be treated as gross revenue for the purpose of calculating gross margins.  This includes payment for replacement of non-performing chemical and associated good will payments.

What if I do not have a 5 year history?

On a case by case basis, we will consider those who have 3-4 years of accrual financials. Special consideration is required by our reinsurers, and they will either accept or deny your application.

Why do I need to have accrual financials?

Accrual accounting defines profit or loss for your business each year. It is the best way to evaluate farm management. We make a risk judgement and properly build a quote according to your farm.

If I am on a cash accounting method of reporting, could I use my AgriStability information to get a quote?

AgriStability can be a starting point for the data needed to evaluate the farm's financials. GARS must be in compliance with its reinsurers regarding financial evaluation, and therefore an in depth look at the financials is required. GARS requires the producer to provide the converted data. (Cash to Accrual)

How PCI Works

Who is the insurance company? Who backs the insurer?

Global Ag Risk Solutions (GARS) is the Managing General Agent (MGA) for Northbridge General Insurance Corporation, a 100% Canadian owned commercial property and casualty insurance management company. Northbridge is also supported by 12 reinsurers from around the world. Many of these also reinsure Alberta, Saskatchewan and Manitoba crop insurance.

How is my insurance affected if I have maximized my input coverage and still need to apply more?

Insurance coverage increases as inputs increase. Example:  If you have $150/acre of input coverage (Basic Level) and your extra pass of fungicide equals another $20/acre, you are now insured for $170/acre, WITH NO INCREASE IN PREMIUM.

Can I insure individual crops?

GARS provides a full farm revenue based crop insurance.

Does Crop Insurance, Hail Insurance or AgriStability claim payments affect a GARS award?

Our insurance stands alone. We do not recognize the premium expense or the revenue of a payout from other insurance claims. Your payout from Global Ag Risk Solutions is not reduced by other insurance awards.

Should I still buy Crop Insurance? Hail Insurance?

Global Ag Risk Solutions promotes provincial crop insurance and provincial and private hail insurance. We will advise how to use the products effectively with little to no increase to your premium dollars. Please call our office and speak with a representative for an explanation.

Are fall applications covered for the next crop year?

Yes. Accrual accounting will calculate any expense for growing your following year's crop.

Does GARS pay for unseeded wet acres? Do I need to prove establishment in order for those acres to be insured?

We do not "directly" pay for unseeded wet acres. If the acres unseeded negatively affects your insured net crop production you will be in claim. GARS will cover actual inputs (seed, chemical and fertilizer) plus the selected enhanced coverage on the entire insured acres.

You do not need to prove establishment to have the acres insured.

What if no acres are seeded?

GARS will cover actual inputs of seed, fertilizer and chemical plus the enhanced coverage. If no acres were seeded there would be no inputs. The producer would collect their selected "Enhanced" coverage for their entire amount of acres on the policy.

How does GARS protect forward pricing?

Forward pricing may affect gross margin. If the producer has a situation where he must buy back a portion of the contract, this will affect the gross margin. GARS will protect this potential situation.

Does GARS insure farms that have crop share agreements? How does this work?

There are a variety of crop share arrangements between farmer and landlord, therefore, agreements will be individually analyzed.  Global Ag Risk Solutions insures most crop share agreements.

Quoting/Costs

What does it cost?

Quotes are reflective of each individual farm. We build a price based on your farm’s gross margin. Premiums are developed from analysis of your financial history. Basic coverage insurance will cover the actual costs of fertilizer, seed and chemical. In addition, enhanced coverage of up to $125/acre may also be purchased.

How do I get a quote?

There is no fee attached to quoting. We will direct you to the Global Ag Risk Solutions Advisor in your area.  You will be asked to complete and sign the "Authorization to release financial information" form. When faxed or emailed back to our office, this one page document will give GARS permission to contact your accountant to request the financial information required for quoting. You can also supply your own copy of financial statements. We require your last 5 years (one year lag) of Accrual Financials. Cash financials will need to be converted to accrual.

Example: To quote the 2016 crop year if your year end is between September - December we will ask for the records from 2010-2014, if between January - August we will ask for the 2011-2015.

What if I do not have a 5 year history?

On a case by case basis, we will consider those who have 3-4 years of accrual financials. Special consideration is required by our reinsurers, and they will either accept or deny your application.

How is the coverage level calculated?

"Basic" coverage level is calculated by averaging the cost of seed, chemical and fetilizer according to a 3 year history. An additional 40% will be added at this level to cover unexpected increase in costs. GARS covers your ACTUAL costs of fertilizer, seed and chemical at the Basic level. If you qualify, based on the analysis of your financial records you may have the option to choose one of our "Enhanced" coverage levels of $25, $50, $75, $100 or$125 per acre. If the last 3 year average of inputs (plus 40%) equals $175/acre and you choose $75 of Enhanced coverage, the total revenue of up to $250/acre is insured.

When is the premium due? Are there payment options?

Premium is due at the time of the binding agreement. We accept cheques or bank to bank transfers.  Financing is available.

Financing

What types of financing are available?
  • FCC Crop Input Financing (through GARS)
  • Global Ag Risk Solutions Financing
How long does an application take?

FCC Crop Input Financing is dependent on FCC's Customer Service Centre, as they complete the approval process.

GARS approval is completed through the GARS Financing Department and takes approximately 3-5 business days once all financial information is obtained.

Who do I contact in regards to financing options?

Please contact the GARS Financing Department at the Global Ag Risk Solutions office in Moose Jaw at 306-704-GARS (4277) or 877-606-GARS (4277).

Claims

Does Crop Insurance, Hail Insurance or AgriStability claim payments affect a GARS award?

Our insurance stands alone. We do not recognize the premium expense or the revenue of a payout from other insurance claims. Your payout from Global Ag Risk Solutions is not reduced by other insurance awards.

How does the claims process work? Who pays for this process?

GARS is a full farm revenue crop insurance and therefore does not require a farm visit to measure bins after harvest. If you have a claim, we will request an interim harvest report from your accountant after harvest or by December 31. If there is a claim, 60% of the award may be paid after GARS evaluates the necessary records. 40% is held until after May 1 (Inventory cut off date). This will allow time to market your crop. If remaining inventory is sold by May 1st the final 40% will be calculated. An inventory declaration will be required if you have crop in your bins on May1st.  We will work directly with the producer to determine the best price and settle the remaining 40% based on that evaluation. 

Claims Pro is the third party adjusting firm.  GARS pays for the adjusting process.

When would I be in claim?

You would be in claim if your net production income is less than your insured net crop production.

Example:

Insured net crop production=$2,000,000
Net production income=$1,250,000
Claim award=$750,000
If I have a claim, how will my following year's premium be affected?

Like any type of insurance, in a claim situation, your following year's premium will be adjusted accordingly.