Missouri regulators will require the state's farm-mutual companies to purchase reinsurance to protect their maximum annual loss of surplus for property risks, a response to the 2011 Joplin tornado that put one insurer in distress.
The Missouri Department of Insurance adopted new regulations this week that require farm-mutual companies to "carry enough reinsurance that future losses would not deplete its surplus by more than 20 percent in one year."
Rural Missourians obtain their coverage from the state's farm-mutual companies if it is difficult for them to obtain coverage from traditional property and casualty insurers.
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