Crop Insurer Reaches $10 Million Agreement

December 29, 2000

Rain and Hail Insurance Service, a West Des Moines, Iowa-based insurance company, has reached an agreement to pay $10 million to the federal government to settle claims that the company misrepresented the condition of damaged California raisin crops.

Rain and Hail, the nation’s largest crop insurer, admitted no wrongdoing in the settlement according to a news release from the U.S. attorney in the eastern district of California.

The federal government alleged that Rain and Hail falsely represented the condition of rain-damaged raisin crops in the Fresno, Calif., area in 1994, causing the crop insurance corporation to pay insurance claims submitted by growers.

The government claims that the raisins were reconditioned and sold at full market value despite claims that they could not be reconditioned. The government also claimed that Rain and Hail duplicated, falsified and fabricated documents to support the false claims.

The federal investigation was announced in 1997 after an independent contractor who worked as a loss adjuster for Rain and Hail pleaded guilty of filing false claim forms.

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