GuideOne’s only insurance investment gone sour
In the summer of 2017, Crop Pro, a startup from Iowa, announced an $8 million Series A round led by agriculture investors Finistere Ventures and Seed 2 Growth Ventures (S2G), with participation from specialty insurer GuideOne Insurance .
Established in 2012 and led by Billy Rose, the company was the first Ag venture-funded insurance provider to earn approval from the US Department of Agriculture (USDA) to offer Federal crop insurance products to farmers. In fact, it was one of only 16 approved providers at the time.
“Billy is a proven entrepreneur with over 20 years of experience in the insurance and ag lending industry. His vision and big picture understanding of agriculture, technology, lending, and crop insurance have resulted in successful ventures that are beneficial to America’s farmers and the agricultural industry. Billy successfully founded and exited three different companies including Ag1 (acquired by DTN) in which he negotiated $143 million in private label lines of credit financing to customers; Crop 1 Insurance in which $300M in premiums were acquired by Farm Bureau Mutual; and Crop Pro which was acquired by AmTrust Financial. He also received the honor of Ernst & Young’s Entrepreneur of the Year award for Iowa & Nebraska.” – Rosenblatt Securities.
“First and foremost, we are committed to serving the needs of the traditional crop insurance market. At the same time, agriculture is evolving as new technologies come to market and emerging markets are developing. The SRA approval enables Crop Pro Insurance to offer federal crop insurance, while Crop Pro also creates and provides risk management solutions. These solutions will help growers and agents manage the potential financial risk in using new technologies and participating in these emerging markets.” – Billy Rose, chairman of Crop Pro Insurance.
“Crop Pro Insurance may be a new company, but we are not new. We have decades of proven experience in bringing solutions to agents and growers alike.” – Joe Young, president of Crop Pro Insurance.
In its active days, Crop Pro offered agents a simplified processing system designed to provide the tools needed to maintain a policy in one easy to use integrated platform. Agents were able to enter new policies, report production or acres, or submit loss notices; all via the company’s platform called Pro Processing. Also, agents had access to Pro Mobile for on-the-go data from one’s smartphone.
However, its active days were limited.
As reported by Matt Olberding for the Journal Star, Crop Pro is no longer an approved crop insurance provider by the USDA. In May of 2018, Crop Pro provided notification of 60 day cancellation to numerous producers in the states of Nebraska and Colorado on their Crop Hail Named Peril (CHNP) policies for failure to obtain reinsurance causing “a disruption in the market place” as many producers and agents have complained about the effect this cancellation has had on producers’ coverage.
In total, it is estimated that nearly 200 crop hail insurance policies in Nebraska and a handful of policies in Colorado were cancelled and that producers moved policies to other insurance carriers.
Finally, late last year, Crop Pro has agreed to pay a $50,000 fine. In addition to the fine, the order required the company to voluntarily surrender its insurance producer and managing general agent licenses in Nebraska and to not reapply for a license in the state for at least five years. GuideOne, also based in Iowa, agreed to pay a $10,000 fine as part of the consent agreement.
As it stands, Crop Pro has a new name and a new mission. Under the name Growers Edge Financial , it is now focused on delivering risk analytics and farm management tools and products to farmers.