Insurance Providers FAQs

Who are the main farm insurance providers in New Zealand?

New Zealand's farm insurance market includes several major providers:

• FMG (Farmers Mutual Group): NZ's largest rural insurer, farmer-owned cooperative, 115+ years experience, exclusively focused on rural sector
• Vero: Major general insurer with strong rural division, part of Suncorp Group, comprehensive farm insurance products
• NZI (part of IAG): Long-established insurer, good rural presence, wide range of farm products
• AIG: Global insurer with NZ farm insurance offerings, strong commercial focus
• Crombie Lockwood: Broker with own insurance products, strong agricultural expertise
• Tower: Offers rural insurance products, varying regional presence
• Specialized rural insurers: Several smaller providers focusing on specific farm types or regions

Each provider has different strengths, pricing, coverage options, and service approaches. Compare multiple providers for best value.

What's the difference between FMG and other farm insurers?

FMG is unique as a farmer-owned mutual cooperative - policyholders become shareholders receiving dividends when the company performs well. FMG focuses exclusively on rural insurance with deep agricultural expertise, rural-specific claims assessors who understand farming, customized products for different farm types, strong rural community connections and support, and 115+ years of farming insurance experience. Other insurers (Vero, IAG, AIG) are publicly or privately owned companies offering farm insurance alongside residential and commercial products. They provide broader insurance options, may have more competitive pricing in some cases, often have larger claims resources, but may lack specialized rural focus. Neither approach is inherently better - choose based on service quality, pricing, and coverage for your specific needs.

Should I use an insurance broker or go direct to an insurer?

Brokers and direct purchase each have advantages:

Broker advantages: Compare quotes from multiple insurers simultaneously, provide expert independent advice on coverage adequacy, handle claims advocacy and negotiation, save significant time in comparison shopping, often access better rates through volume agreements, offer ongoing policy reviews and updates, and provide personalized service understanding your farm.

Direct purchase advantages: No broker fees (though many brokers are commission-paid by insurers), direct relationship with insurer, potentially faster policy changes, complete control over all decisions, and works well if you know exactly what coverage you need.

For complex farm operations, broker expertise typically outweighs any cost savings from direct purchase. For simple livestock blocks with straightforward needs, direct purchase may work. Most commercial farmers benefit from broker relationships.

How do I choose the best farm insurance provider?

Evaluate providers on multiple factors:

• Coverage options: Do they offer products matching your farm type and needs?
• Pricing competitiveness: How do quotes compare? (Get 3+ quotes)
• Claims service reputation: Research reviews, ask other farmers about claims experiences
• Financial strength: Check credit ratings ensuring they can pay large claims
• Rural expertise: Do claims staff understand farming operations?
• Service quality: Responsiveness, communication, accessibility
• Policy flexibility: Can coverage be customized to your needs?
• Additional services: Risk management support, safety programs, industry connections

Don't choose on price alone. Balance cost with service quality and coverage breadth. Ask other farmers about their experiences with different providers.

What's more important - lowest price or best service?

Service quality matters more than slight price differences. The cheapest premium means nothing if claims are denied, delayed, or underpaid due to poor service. A $10,000 annual premium vs $9,000 saves $1,000, but if the cheaper insurer pays $20,000 less on a $100,000 claim due to aggressive assessment or poor claims handling, you've lost significantly overall. Evaluate value holistically: claims service reputation (most important - insurance exists for claims), coverage comprehensiveness, policy terms and exclusions, financial strength of insurer, responsiveness and communication, and then price competitiveness. A 10% premium difference is worth paying for significantly better claims service. However, 40-50% premium differences warrant investigation even if service is better. Find the balance between competitive pricing and quality service.

How do I check an insurer's financial strength?

Financial strength ratings from independent agencies assess insurers' ability to pay claims. Check: AM Best ratings (gold standard for insurance company ratings, A++ to D), Standard & Poor's (AAA to D ratings), and Moody's (Aaa to C ratings). Look for minimum A- or equivalent ratings. Financial strength is crucial - an insolvent insurer can't pay your claim. FMG, Vero, IAG-owned companies all maintain strong ratings. Smaller or newer insurers may have lower ratings or lack ratings entirely. Check ratings before purchasing, especially for large coverage amounts. If an insurer won't disclose ratings, that's a red flag. Financial strength information is usually available on insurer websites or independent rating agency sites.

Can I switch farm insurers mid-policy?

Yes, you can switch anytime, but consider costs and timing. Switching mid-term involves: short-rate cancellation fees (paying penalty for early cancellation, typically 10-15% of remaining premium), potential loss of no-claims bonuses accumulated with current insurer, forfeiting any loyalty discounts, and administrative time and effort. Benefits of mid-term switching: immediate premium savings if new insurer significantly cheaper, better coverage if current policy inadequate, or escape from poor service. Generally better to switch at renewal when cancellation fees don't apply and you can properly compare renewal offers. However, if current insurer provides poor service, inadequate coverage, or premium is grossly excessive, mid-term switching may be worthwhile. ALWAYS ensure new coverage begins before canceling existing insurance - never leave your farm uninsured even briefly.

What questions should I ask prospective insurers?

Critical questions to ask:

• Coverage specifics: "What's covered and excluded for [specific farm type]?"
• Claims process: "What's your average claim settlement time?" "Do you use specialized rural assessors?"
• Policy terms: "What's the excess for flood/earthquake events?" "Is coverage replacement or indemnity?"
• Flexibility: "Can coverage be customized for [specific need]?" "How do mid-term changes work?"
• Discounts: "What discounts are available and how do I qualify?"
• Service: "Who's my main contact?" "What are your service hours?" "How do I make changes or claims?"
• Financial: "What's your financial strength rating?" "How long have you been in business?"

Do different insurers have different exclusions?

Yes, policy exclusions vary significantly between insurers. While some standard exclusions are common (wear and tear, intentional damage), insurers differ on: flood coverage (some exclude or severely limit in flood-prone areas), specific livestock diseases covered or excluded, mechanical breakdown (some exclude, others include as optional add-on), fence coverage (some provide limited coverage, others exclude entirely), cyber risks (increasingly excluded unless added), gradual damage interpretation varies, and specific perils like landslip or tsunami may be treated differently. ALWAYS read and compare exclusions sections between quotes. Don't assume "farm insurance" means the same thing from every provider. Ask specifically about coverage for events relevant to your region and farm type. Brokers can help identify important exclusion differences between providers.

How important is claims service reputation?

Claims service is arguably the most important factor in choosing insurance. You buy insurance for claims - service quality directly impacts whether you're properly compensated. Research provider claims reputation by: asking other farmers about their claims experiences (most valuable feedback), checking online reviews on platforms like Consumer NZ, Google, ProductReview, asking your broker about insurer claims service (they handle claims across multiple insurers), checking complaint statistics (Insurance and Financial Services Ombudsman publishes complaint data), and inquiring about average claims settlement times and dispute rates. Red flags include consistent complaints about delayed settlements, low-ball settlement offers, claims denied on technicalities, poor assessor availability, or difficult communication. Good claims service has fast initial response, clear communication throughout process, fair valuations, and efficient settlements.

What's the benefit of using a specialist rural insurer vs general insurer?

Specialist rural insurers like FMG offer: deep agricultural industry knowledge and understanding, claims assessors who are farmers or have farming backgrounds, policies specifically designed for farming operations, better understanding of rural risks and seasonal challenges, stronger rural community connections and support, and may be more sympathetic to farming-specific issues. General insurers offering farm insurance provide: potentially more competitive pricing through economies of scale, broader product range if you need non-farm insurance too, larger resources and wider geographic coverage, may have more financial backing, and often good rural divisions despite broader focus. Choice depends on your priorities. If you value specialized expertise and rural focus, specialist providers may be better. If you want competitive pricing and consolidated insurance, general insurers with strong rural divisions work well. Both can provide excellent service - research specific provider reputations.

Are there loyalty benefits for staying with one insurer?

Some insurers offer loyalty benefits: no-claims bonus discounts increasing with claim-free years (typically 5-10% per year, capped at 50-60%), loyalty discounts after certain years (e.g., 5+ years), preferential premium increases (existing customers protected from worst increases), easier coverage increases or policy adjustments, relationship pricing where long-term customers get better rates, and priority claims service for long-standing customers. However, loyalty doesn't always pay - many insurers charge existing customers more than new customers, assuming loyalty prevents switching. Compare quotes even if you're happy with current insurer. Use competing quotes to negotiate better rates while keeping loyalty benefits. Don't assume loyalty is rewarded - verify you're getting competitive pricing. Some farmers switch every 3-5 years to ensure competitive rates, while others value relationship continuity. Balance loyalty benefits against potential savings from switching.

How do I compare quotes from different insurers accurately?

Accurate comparison requires apples-to-apples evaluation:

• Identical coverage: Ensure sum insured amounts are identical across quotes
• Same excess levels: Different excesses dramatically affect premiums
• Coverage basis: Verify all quotes are replacement value (or all indemnity)
• Inclusions: Check what's standard vs optional in each quote
• Exclusions: Compare exclusions - cheaper premiums often mean more exclusions
• Liability limits: Ensure public liability limits are the same
• Business interruption: Compare coverage periods (12 vs 24 months) if included
• Total cost: Include all fees, levies, and charges, not just base premium

Brokers create standardized comparison documents making this easier. If comparing yourself, create a spreadsheet listing all coverage elements and checking each quote against it.

Do insurers specialize in certain farm types?

Yes, some insurers have particular strengths in specific farm types. FMG has strong dairy farm expertise, excellent sheep and beef credentials, and comprehensive rural experience across all farm types. Vero has good dairy farm products, strong pastoral farming presence, and broad rural insurance experience. Some smaller insurers specialize in: lifestyle blocks and small holdings, specific regions (e.g., high-country South Island specialists), horticulture and viticulture, or organic farming operations. If you have specialized farming operations (deer farming, aquaculture, horticulture), seek insurers with relevant expertise. They better understand risks, provide more appropriate coverage, and handle claims more sympathetically. Ask prospective insurers about their experience with your specific farm type and request references from similar operations.

What if I'm unhappy with my current insurer?

If dissatisfied with your current insurer, first attempt to resolve issues directly: discuss concerns with your broker or account manager, escalate to insurer's complaints department if unresolved, document all issues and communications, and request specific improvements or solutions. If issues persist: research alternative insurers with better reputations for your concern area (e.g., claims service), obtain quotes from competitors while current policy active, compare coverage and pricing comprehensively, and plan switch at renewal to avoid cancellation fees. For serious issues (denied claims, poor service): lodge formal complaints with the insurer, escalate to Insurance and Financial Services Ombudsman if needed, seek legal advice for significant disputes, and switch insurers at next renewal. Don't stay with poor service out of inertia - insurance is too important. However, ensure complaints are justified and you've given the insurer fair opportunity to rectify issues.

Are online insurance providers as good as traditional insurers?

Online or direct insurers offer digital-first experiences with potentially lower premiums (lower overhead costs), 24/7 online policy management, fast quote processes, and streamlined claims submission. However, they may have limited personalized service, less farming expertise, phone support instead of face-to-face meetings, and potentially less flexibility for complex farm operations. Traditional insurers with agents/brokers provide personalized service, face-to-face consultations, deep rural expertise, customized coverage options, and strong claims advocacy. For complex commercial farms, traditional insurer relationships often provide better value despite potentially higher premiums. For straightforward lifestyle blocks, online insurers may work well. Consider your comfort with digital platforms, complexity of your operation, and value placed on personal relationships. Many farmers prefer traditional relationships for peace of mind and expert guidance.

How often should I review and compare insurance providers?

Review providers comprehensively every 2-3 years minimum, even if you're satisfied with current service. Annual renewal time always warrants comparison: get at least 2-3 competitive quotes, review whether current coverage still meets needs, verify you're getting competitive pricing, and assess service quality over past year. More frequent comparison if: premium increases exceed 10% at renewal, you've had poor claims experience, you've heard negative feedback about your insurer, significant farm changes require coverage updates, or competitor advertising suggests better pricing. However, switching frequently (annually) can mean: losing no-claims bonuses and loyalty discounts, administrative burden and time cost, relationship disruption, and potential coverage gaps during transitions. Balance getting competitive pricing against relationship value and switching costs. Established broker relationships handle comparison shopping, making regular reviews easier.

Do farmers' organization memberships provide insurance benefits?

Yes, several farming organizations offer insurance member benefits: Federated Farmers has partnership arrangements with insurance providers offering member discounts (typically 5-10%), access to specialized insurance products, and group buying power advantages. DairyNZ, Beef + Lamb NZ may have insurance partner relationships. Young Farmers sometimes offers member insurance benefits. Local agricultural shows and societies occasionally have insurance partnerships. Benefits typically include premium discounts, preferential terms, industry-specific coverage understanding, and dedicated member service. Check your farming organization memberships for insurance benefits. Even small discounts add up - a 5% discount on $10,000 premium saves $500 annually. Some partnerships provide better claims advocacy or specialized products beyond just pricing discounts. Always verify that "partnership" discounts are genuinely competitive by comparing against other market quotes.

What's the difference between an insurance agent and broker?

Insurance agents represent specific insurers, sell only that insurer's products, are paid by the insurer, may have sales targets, and provide good service but limited choice. Insurance brokers represent clients (you), access multiple insurers, provide independent advice, are paid through commissions or fees (from insurers or clients), and offer broader market access and comparison. For farm insurance, brokers generally provide better value through market-wide comparison, independent advice, claims advocacy, and expertise. However, good agents representing quality insurers can also provide excellent service. Clarify whether your advisor is an agent or broker - agents must disclose which insurer they represent. Brokers must disclose their commission arrangements. Most commercial farmers benefit from broker relationships providing access to multiple markets and independent advocacy.

How important is insurer proximity and local presence?

Local presence offers advantages: face-to-face meetings for policy reviews, local assessors who understand regional farming, faster claims assessment site visits, relationship building with local representatives, understanding of local risks and conditions, and community connection and support. However, modern insurance often works well remotely through: phone and video consultations, digital document sharing, national assessor networks, and efficient online claims management. Local presence matters more for: complex commercial operations benefiting from in-person consultations, older farmers preferring face-to-face service, remote areas where travel time matters, and those valuing community relationships. It matters less for: tech-savvy farmers comfortable with digital communication, straightforward policies, and those prioritizing price over personal service. Evaluate whether local presence provides tangible service benefits or is just "nice to have." Strong national insurers often provide excellent remote service.

What happens if my insurer goes out of business?

If your insurer becomes insolvent, New Zealand has some protections but limited guarantees. Unlike bank deposits (protected by government guarantee), insurance policies aren't government-guaranteed. If insurer fails: existing policies may be transferred to another insurer, claims in progress may be paid by the insurer's reinsurers or liquidators (often partially), and you may need to find new insurance mid-term. This is why insurer financial strength ratings are critical - they predict likelihood of insolvency. Stick with well-rated insurers (A- or better) to minimize this risk. Major NZ farm insurers (FMG, Vero, IAG brands) are financially strong with minimal insolvency risk. Smaller or newer insurers may have higher risk. If your insurer shows financial stress signs (ratings downgrades, unusual premium increases, delayed claim payments), switch insurers proactively rather than waiting for potential failure.

Can I have insurance with multiple providers?

Yes, you can split coverage between insurers - for example, buildings with one, equipment with another, livestock with a specialist. Advantages include: accessing each insurer's competitive strengths, avoiding concentration risk if one insurer has issues, and potentially better overall pricing. Disadvantages include: administrative complexity managing multiple policies, potentially higher total costs (losing multi-policy discounts), coordination issues if one incident affects multiple coverage types, and more complicated claims if overlapping coverage. Generally simpler and more cost-effective to consolidate with one insurer for multi-policy discounts and streamlined management. However, some situations benefit from split coverage: specialty livestock insurance from specialists while general coverage elsewhere, very large operations where diversification reduces risk, or when one insurer won't provide full required coverage. If splitting coverage, ensure no gaps and clarify how overlapping coverage works.

Should I prioritize price or service when choosing a provider?

Service quality should take priority over modest price differences. Insurance exists to pay claims - service quality during claims is what matters most. Prioritize service when: price difference is less than 15-20%, you value personal relationships and face-to-face service, you've had previous poor claims experiences, you have complex farming operations needing expertise, or your farm has high-value assets where claims service is critical. Price becomes more important when: premium difference exceeds 25-30% for identical coverage, you're extremely budget-constrained, you have simple operations with straightforward insurance needs, or you're comfortable managing policies independently. The optimal approach: eliminate providers with poor claims service reputations, then compare pricing among remaining quality providers. A $1,000 premium saving seems significant until a poorly-handled $100,000 claim costs you $20,000 in underpayment. Balance value and quality wisely.