News & Events
Profax 7/26/2010 - 7/27/2010
US WILL FACE FOOD PRODUCTION CHALLENGES: Today, 60% of all fresh fruits eaten in the USA are imported and a
whopping 80% of seafood is imported. Eighty percent of all food produced in the USA comes from 300,000+ farmers!
These are alarming statistics because we may be relying on foreign countries for our food. We will hope it is safe food
and hopefully cheap food. Today 10% of America’s family income goes to purchase food---the lowest in history. Will
this continue? Maybe not! As the environmentalists, animal rights activists, and governmental regulators [EPA, USDA,
NCRS etc] gain their stranglehold on production agriculture, the supply will decrease while world food supply needs are
expected to increase by 50% in just 40 short years. We could be importing our chicken, our milk, our pork & beef and
normal food staples at the rate we currently import fruits and seafood. Or may we be importing at a rate surpassing our
oil imports? Scary!
OBAMA HEALTH PLAN KILLS HSAs: After enactment of the new health care bill, Health Savings Accounts (HSA) and
Medical Savings Accounts (MSA) will be history. Because the high deductible plans will be “outlawed”, any individual
plan with a deductible will not meet the “essential requirements”. Two national health companies announced they will
stop offering individual medical expense health plans due to the minimum medical loss ratio requirements contained in
the new health bill. American National Life and Standard Life and Accident discontinued selling these plans as of June
30th. These individual plans are mostly high-deductible, major medical-type products.
READING THE TEA LEAVES! During the Sioux Falls USDA field hearings last month, the SD Farm Bureau spoke in favor of
some type of whole farm revenue coverage, which has been supported by House Ag Chairman Collin Peterson [D-MN].
Peterson says he thinks crop insurance funding can be maintained by coordinating it with all other risk management
tools like ACRE. He went on to say, “We have some ideas that we are looking at that we haven’t talked about too much
in public . . .those new safety net concepts could be rolled out by the Committee as early as next month”. Meanwhile
Rep. Stephanie Herseth Sandlin [D-SD] suggested lawmakers look at “tweaking the ACRE program to base revenue
numbers on a county or local basis”, an idea that was well received by growers on the panel. Farmers, agents, bankers
and crop companies need to understand that a simple farm-based whole farm risk plan delivered by FSA, over the
internet, or by some other governmental bureaucracy would change the 30-year-old crop risk program as we know it
today. It seems like supporters of ACRE want the program to do what “crop insurance does” but for FREE. Using local,
county or farm specific triggers for ACRE looks unlikely because of huge costs in perilous deficit times.
RED FLAG RULES POSTPONED: What are the Red Flag Rules? They are a group of federal regulations flowing from the
Fair and Accurate Credit Transactions Act of 2003. These rules require specific entities to develop a written ID Theft
prevention program if the business is doing business as a “creditor” or a business that has “covered accounts”.
Businesses that are deemed “covered entities” must comply with the Red Flag Rules. Most insurance agencies and
brokerages won’t need to comply unless in instances where the agent or broker’s business practices may be required to
comply. In particular, involvement with premium financing, advancing premium dollars on behalf of an insured, and
regularly arranging for the extension of credit may require the agent or broker to comply. The FTC [Federal Trade
Commission] has agreed to postpone enforcement to give time for those who must comply to develop their program.
NORTH DAKOTA LEGISLATOR TO HEAD NATIONAL ASSOCIATION: Rep. George Keiser {R-BIS] has been named
President-Elect of the National Conference of Insurance Legislators [NCOIL] which recently held its quarterly meeting in
Boston. Keiser has served in the North Dakota House since 1993 and has been Chairman of the Industry, Business and
Labor [IBL] Committee for several sessions. Keiser led a Joint Committee Panel hearing in May dealing with the recently
passed Health Care Reform Legislation. The all-day hearing had presenters from the Canadian health care system,
hospital administrators, doctors, insurance industry representatives, insurance department reps and health department
reps reviewing aspects of the new law. Costs, budgets and planning are key for state legislators to become proactive
before full enactment of the law. Keiser and fellow legislators are in front of the issue. Keiser moderated a panel of
experts on health care reform at the NCOIL meeting also.
