Montana’s insurance commissioner has placed Great Falls-based Westland Farm Mutual Insurance Co. under her office’s supervision, citing the company’s diminishing cash reserves.
Commissioner of Securities and Insurance Monica Lindeen said Westland will cancel all of its homeowner’s insurance policies by June 30. Its crop-hail insurance policies will remain in effect.
Lindeen’s office recommended current holders of farm and homeowner’s policies move them to another company before the end of the month so they don’t risk a lapse of coverage that could violate the terms of their mortgage or result in higher premiums on future policies.
Lindeen’s order bars Westland from taking on any more liabilities or selling any new non-crop-hail insurance policies.
To protect their customers, Montana farm mutual insurers sell policies that are backed, or reinsured, by other national and international insurance companies While Westland’s crop insurance policies are fully reinsured, its farm and homeowner policies were only partially reinsured, meaning Westland had to pay a portion of every claim out of its own reserves.
With Westland’s increased exposure and dwindling reserves, Lindeen’s office estimated the company would run out of money to pay claims on its farm and homeowner’s insurance policies by August.
Topics Agribusiness Homeowners
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