Maurice “Hank” Greenberg’s Starr Cos. is expanding in U.S. crop insurance, joining Validus Holdings Ltd. (VR:US) in bets on agriculture after last year’s drought fueled higher costs for the coverage.
The Starr Indemnity & Liability Co. unit won approval to participate in a government-backed program from the U.S. Department of Agriculture, the company said today in a statement. The insurer plans to cover crops including corn, soybeans and wheat, Charles Dangelo, chief executive officer of Starr Indemnity, said in a phone interview.
“It’s still relatively new” for the insurer to be in the crop business, he said. The company will target “the heartland of the U.S.,” including states such as Indiana, Illinois, Minnesota, Nebraska and Texas, he said.
Private insurers sell and administer the coverage in the U.S. and get a backstop from the federal government. Australia’s QBE Insurance Group Ltd. and Bermuda-based Validus are among companies that expanded in the business in the U.S. The top sellers of the coverage are Wells Fargo & Co. and Ace Ltd., led by Hank Greenberg’s son Evan Greenberg.
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