A new way to think about managing risk on your farm

Unpredictability is at the heart of your farm business—especially with inflation and concerns about a potential economic downturn adding to the perennial issues of severe weather, disease, and other forces of nature. That makes effective risk management a critical factor in your success.

While you can do very little to prevent flooding or temper the effects of rising interest rates, the right coverage can protect you from a wide range of worst-case scenarios.

Unfortunately, there is no single answer to your insurance and risk management needs. Some plans may protect against crop losses due to weather events, while others can provide price certainty when you take your product to market. 

But how do you know which program or how much coverage you’ll need and when? 

The key is to have the right programs in place at the right time, which is often easier said than done. 

Does your plan provide the coverage you need?
Don’t be discouraged if your answer is, ‘I don’t know.’ Because you’re not alone. 

Most farmers don’t have the tools, time, or knowledge to navigate the various insurance and risk management programs. And how could you? 

It can take days to read pages of insurance literature to make sense of which programs you qualify for, which ones you need, and whether you’re covered against all your likely loss events. That’s not exactly time you have when you’re already working from sun up to sun down, week in and week out. 

Insurance programs often include a great deal of industry-specific terminology. Necessary as it is for legal reasons, it can also come across as foreign and difficult for non-experts to understand. Add to that the complexity that not all the programs are plug-and-play. Some complement one another, while others can cancel each other out. 

Coverages, premiums, and requirements change annually, so this is not an exercise you can do once—it must be part of your annual planning. 

There is a better way to compare your risk management options
At MNP, we recognize that planning for your future is challenging, even without the difficulties in creating an effective risk management program for your farm. Our advisors have dedicated considerable time to making this process as pain-free and productive as possible. 

One of the resources we’re most proud of is our Ag Risk Management Projector (ARMP). This interactive scenario planning tool compares your farm data and insurance coverages to demonstrate how your plan will look in various situations. 

ARMP can help you identify the best coverage options for the loss events you’re most likely to face. The tool is valuable whether you’re starting from scratch or reviewing your existing strategy. 

Not only will it save you hours, but it can also help you plan for a broader range of scenarios than would otherwise be possible. That gives you a lot more peace of mind that the plans you enroll in are the best ones for you.  It also allows you to look at options you may want to consider within your operation if conditions change. 

You don’t have to do it all alone
ARMP is a powerful tool. But you’ll find the structure and direction it provides in conversations with your MNP advisor is its greatest asset. Rather than speaking in hypothetical scenarios, you can talk about real situations that could happen on your farm, backed by your farm data, and the impacts of various risk management strategies. 

Based on those conversations, you could make further changes to your ARMP inputs to see if and how that might change your thinking. And that might lead you to discuss other potential risk areas on your farm that you otherwise wouldn’t have considered. The outcome is an exponentially more robust and comprehensive strategy tailored to your farm. 

Moreover, ARMP makes it possible to update your risk management plans in near real time. We can re-run simulations if market prices change or yield estimates increase or decrease. In the best-case scenario, the results will validate the plans you have in place. Conversely, this proactive planning potential will allow you to modify your coverages to ensure they deliver the peace of mind you need.

For an in-depth look at your risk management strategy, and to learn more about ARMP, contact Patsy Hewitt, CPA, CMA, at

1401 Princess Avenue, Brandon


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