SANTA ROSA — American AgCredit’s recent acquisition of Petaluma-based Chris Maloney Crop Insurance Services represents a growing focus toward crop insurance in California, as the farm lender seeks to bolster its financial offerings to West Coast farmers.
Financial terms of the deal were not disclosed, but the Santa Rosa-based farm lender said the agency, founded by Chris Maloney in 1999, is one of the largest providers in California.
With the acquisition, AmericanAg Credit said it will add to the breadth of its financial services, which includes mortgage and operations financing, farm land appraisal and leasing.
“The ability to provide expanded services to agricultural producers is an important component of our business approach,” Ron Carli, president and CEO of American Ag Credit, said in announcing the acquisition.
It’s the second acquisition of a crop insurance agency for American AgCredit since 2011, the first being Fiorini & Squires Insurance Agency of Turlock, which represented the company’s first foray into crop insurance in California, although it has always provided the service in Kansas and Oklahoma, according to Mike Phillips, vice president of insurance services.
The two acquired insurance agencies in California together hold about $10 million in premium volume, Mr. Phillips said, adding that American Ag Credit would likely continue to search for potential acquisitions throughout California.
“We will be strategically looking at agencies throughout the state,” he said.
“I can say we started with virtually nothing when we started the process. We’re now in excess of $10 million today in premium,” in California, Mr. Phillips said. “We’re excited about being in California and now the Bay Area, and look forward to working with producers growing crops.”
All told, in Kansas and Oklahoma, American AgCredit’s insurance business holds approximately $40 million in premium volume, Mr. Phillips said.
He added: “Our focus isn’t so much in how big we grow the crop insurance product but how well we can support the lending department.”
The expanded effort in California presents several unique challenges in crop insurance, given the much higher concentration of specialty crops, such as wine grapes or avocados, according to Mr. Phillips.
“They are very different types of policies,” Mr. Phillips said of much of California’s crop insurance market. “They are production-based policies, but the focus is on specialty crops. The primary focus of our acquisition is to obtain expertise in this area.”
Chris Maloney Crop Insurance has a large concentration of wine grape growers as clients throughout the North Coast, as well as the Central Coast, Salinas and Central Valley regions. With the acquisition, American AgCredit will be able to significantly grow its offerings in multi-peril and livestock margin-dairy coverage throughout the state.
“We’re excited to be part of the American AgCredit team,” Ms. Maloney said in a statement. “The opportunity to have access to additional financial services for our customers — and the opportunity for American AgCredit’s customers to access specialized crop insurance — is significant.”
Mr. Phillips said American AgCredit will now shift its focus on educating California producers on the importance of coverage for specialty crops, as well as knowing the different risks associated with the varying specialty crops.
Existing agents with Chris Maloney, Shannon Antonini and Fred Carvajal, along with office manager Emily Carvajal , will remain on staff with American AgCredit, which has $6 billion in assets.
Copyright © 1988–2013 North Bay Business Journal
View the policy for linking to website content.