Farm Mutual Re rebrands

The Farm Mutual Reinsurance Plan introduced a new brand name and logo at this year’s annual meeting in Toronto.
It is now operating as Farm Mutual Re, with the tagline ‘collaborate, empower, succeed.’
Farm Mutual Re president Steve Smith said the company’s significant growth over the last 10 to 12 years and the change and evolution within the insurance industry caused FMRP to reflect on and understand its relevancy.
He said the organization considered its unique qualities and its underlying purpose, with a view to extending a common understanding of that purpose to  everyone at Farm Mutual Re — from employees to board members.
“We wanted to create an environment that stood behind what we said we do and wanted to create an environment that we lived every day.”
Cambridge, Ont.-based FMRP was established in 1959 by mutual insurers from across Ontario. It was Canada’s fifth largest reinsurer in terms of assumed gross written premiums in 2015 ($166m).
The new identity and logo, a maple leaf superimposed on a globe, are the culmination of a 15-month process.
Mr. Smith said the rebranding team came up with five statements to define what it does:
■ Build deep-rooted relations that drive trust and success;
■ Deliver on promises, which is essential to that trust and applies to employees, associates, everybody;
■ Recognize FMRP has a genuine and real value;
■ Be a Canadian leader in agricultural-based reinsurance, and
■  Be more than a reinsurer.
“We are dedicated to the sustainability and independence of our mutual insurance community and that supports the services that we provide to all of you,” Mr. Smith said. “It supports what we do and why we are here.”
The team also envisioned a new value proposition.
“We believe in collaboration with our members and business partners, we deliver on our promises and empower the mutual community for success and to succeed.”
Mr. Smith said the team toyed with the idea of dropping ‘farm’ from the name altogether.
“But we found that it is relevant to maintain ‘farm’ in our name . . . to recognize our agricultural heritage.”
FMRP’s premiums increased by 10.6% in 2016 to reach $183m, reversing the trend of the past three years.
Its chief operating officer Claude Smith said the premiums written increase is one of the year’s high points.
FMRP’s revenue grew by $17.6m, almost returning to the peak level of 2012.
He said the $19m three-year decline and current increase are “a story of two different market segments.”
FMRP operates in both direct and broker distribution segments.
The downward trend in the direct segment, which had been in decline since 2012, stopped in 2016 as premiums written increased by nearly $1m.
“This tiny but significant increase reflects lower increases in contract retention and reasonable growth in subject premium,” Mr. Smith said. “We emphasize consistent, managed and profitable growth (and) will not sacrifice our enterprise value just to increase revenue.”
He said there has been a steady growth in broker distribution premiums written for many years due to long-term relationships and affinity between mutual insurance companies.
FMRP’s underwriting profit declined by 80%, primarily due to an increase in the severity of property claims.
“Underwriting profit in 2016 is charitably characterized as disappointing,” Mr. Smith said.
He said the disappointing underwriting profit had one major cause, a direct segment property risk, which ended the year with a 158% combined ratio and contributed an $18.6m underwriting loss.
Despite the challenges, voting and participating member equity grew to $393m, a 15.2% compound annual growth since 2008 and its minimum capital test ratio has strengthened to 547%.
“We are not concerned with where we have been nor where we are today (but) where we could be going should we become complacent,” Mr. Smith said.
“We see the possibility for declining rate adequacy, declining underwriting profit and declining investment income and look for responsible ways to protect our capital.”