Copyright © 2013 Diversified Crop Insurance Services. All Rights Reserved. No distribution or reproduction
without written consent. Diversified Crop Insurance Services is an equal opportunity provider.
Services Provided by:
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You’ve never really been insured,UNTIL NOW.
Services Provided by Global Ag Risk SolutionsThis product may not be available in all states. Please check with your DCIS representative for more information.
Diversified Crop Insurance Services is a company of CGB Enterprises, Inc. and is an Equal Opportunity Provider. #7280_103116
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Think about crop insurance differently than you have in
the past…
Why do you insure?
Revenue
Ultimately REVENUE is what matters on your farm…why not insure that?
Bushels are nice at the coffee shop…but dollars in your pocket pay your bills.
Are you in the game for bragging rights?
• OR to WIN?– Why not both with Production Cost Insurance?
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5-Year Crop Revenue Stream
Literally that is what we want to protect…
WHAT?
Yes…literally we want to protect your 5 year historical revenue stream.
It IS that simple.
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On a 5-year average…
Crop Sales
(incl. Hedging)
- Seed
- Fertilizer
- Chemical
Gross MarginOur initial offer is up to 80% of your Gross Margin PLUS 100% of your Seed/Fertilizer/Chemical costs…
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Step 1 - Historical Revenue
We determine on a per acre basis:• What exactly was your previous 5-year revenue
from crop sales.
• We include Hedging gains and losses.
• We add back in
any grain used for
feed.
The result of Step 1 is the first number in our formula.
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Step 2 - Seed Costs
We determine on a per acre basis:
• What exactly was your previous 5-year expense load on seed.
• We look at the actual cost of seed.
• We include any treatment used.
The result of Step 2 is the
second number in our formula.
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Step 3 - Fertilizer Costs
We determine on a per acre basis:
• What exactly was your previous 5-year expense load on Fertilizer.
• We look at the actual cost of Fertilizer.
The result of Step 3 is the
second number in our formula.
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Step 4 - Chemical Costs
We determine on a per acre basis:
• What exactly was your previous 5-year expense load on Chemical.
• We look at the actual cost of Chemical.
The result of Step 4 is the fourth number in our formula.
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Step 5 – Gross Margin
We simply do the math.The result is what we call your:
GROSS MARGIN
We then create a quote for you based on your actual numbers.
Typically our high offer to you is 80% of your Gross Margin.
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We also insure you for
100%of the actual costs of your inputs of:
� Seed
� Fertilizer
� Chemical
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A TRUE Revenue Floor
• Gives you the comfort level to Hedge at the level you want to knowing your revenue is protected.
• Put on that extra fertilizer or try that new seed variety…Use the best, Farm the best.
• Helping you to farm the way you want! Not the way a rule book tells you to.
Copyright © 2013 Diversified Crop Insurance Services. All Rights Reserved. No distribution or reproduction
without written consent. Diversified Crop Insurance Services is an equal opportunity provider.
Any questions so far?
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Financial Analysis
Using your financial records we look at two broad areas to help guide you to success:
• Direct Inputs
– Seed – Fertilizer – Chemical
• Fixed Costs
– LPM – Labor – Power – Machinery
– LBF – Land – Building – Finance
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Financial Analysis, cont…
We have looked at the Direct Input portion already…
Ultimately you need to be sure you can cover those Fixed Costs. Which is done by your Gross
Margin.
Let’s look at Fixed Costs:�LPM�LBF
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LPM –Labor, Power, & Machinery
What it takes to get the job done…
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LBF –Land, Building, & Finance
Fixed Costs Labor, Power, Machinery:• Custom work• Machinery leases• Interest on machinery
loans• Repairs to machinery• Machinery depreciation• Fuel• Labor
Land, Building, Finance:• Land rent• Repairs to buildings• Building depreciation• Interest on land/build
loans• Leases on buildings
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A Step-by-Step Year in
PCI
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Step 1: Financial Release
• Completely and accurately fill out the 2017 Financial Release form.
• Notify your accountant that GARS/DCIS will be contacting them for additional information
• 5 Years worth of Tax Returns– Schedule F along with Supporting Documentation
– Schedule 4797
– Schedule D
• Accrual Financial Statements if possible
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Step 2: GARS contact to Accountant
Step 2 is completely dependent upon your accountant and the speed at which they work.
You can speed up the process by prepping them on the needed documentation.
Timing is everything…
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Step 3: Financial Review
The farm data is confidentially analyzed and quote is provided.
Production Cost Insurance
Quote for Test Producer
Fixed Cost Margin
Coverage
(FCMC)
Input Cost Coverage
(ICC)Cost Per Acre
Your input costs up to a maximum of
$362.13
$375
$350
If, during the year you will exceed this
maximum, you will need to fill out a
detailed input report and we will adjust
your coverage at no additional
premium!
$325
$300
$275
$250
$225 Varies
$200
$175
$150
$125
$100
$75
$50
$25
Please note the pricing shown is an estimate and
should not be considered an offer of insurance. This
estimate is to be used as a basis of pricing. Prices may
be subject to change based upon the information
reported in the application for insurance.
It is extremely important to understand the "Input
Cost Coverage" (ICC) is the ACTUAL COST OF ALL
SEED, FERTILIZER AND CHEMICAL UP TO THE
MAXIMUM AMOUNT SHOWN. (The maximum
amount is up to 140% of the last 3-year average of the
inputs mentioned above. Therefore the maximum
amount shown is not the coverage UNLESS THAT
AMOUNT IS ACTUALLY USED.
**For illustration and educational purposes only**
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Step 4: Producer Review
• DCIS delivers the quote to the agent for review.
• E-Mail is the preferred method to send the quote. The quote will be sent to all who are authorized to receive the quote.
0
100
200
300
400
500
600
700
800
Planning Planting Fertilizer Chemical Addt'l Pass Harvest
FixedCosts
Variable
Protection All Year Long
0
100
200
300
400
500
600
700
800
Planning Planting Fertilizer Chemical Addt'l Pass Harvest
FixedCosts
Variable
Protection All Year Long
PCI$350
GoodHarvest
PoorHarvest
$12 of Risk
How Production Cost Insurance Works
$/Acre
$205
Seeding $345
SeedFertilizerChemical
Fixed Costs
In-Crop Spraying
$375
Fungicide Spraying$410
Desiccation $424
$150
Production Cost Insurance
$290$320$355$369
Step 5 –Application
Copyright © 2016 Diversified Crop Insurance Services. All Rights Reserved. No distribution or reproduction without written consent.
Diversified Crop Insurance Services is an Equal Opportunity Provider. 33
Step 6 – Application Acceptance
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Step 7 – Farm the Way You Want
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Step 8 – Forms during the year
o Acreage Report
o Peril Notification
o Detailed Input Report
o Stored Grain
o Pre-Harvest
o Post-Harvest
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Step 9 - Claim
Copyright © 2016 Diversified Crop Insurance Services. All Rights Reserved. No distribution or reproduction without written consent. Diversified Crop
Insurance Services is an Equal Opportunity Provider. 37
Questions?
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