Deere Exits Insurance Market, CEO Takes Pay Cut

Farmers Mutual Hail Insurance Co. of Iowa announced it will acquire John Deere Insurance Co. and John Deere Risk Protection Inc. No purchase price was disclosed.

The move did not come as a surprise, as the company had earlier announced that it was reviewing strategic options for the unit.

Deere has been involved in the crop insurance business for nine years and had become a Top-10 provider of crop insurance, with national distribution and a product portfolio of both government-backed multi-peril crop insurance coverages, as well as private crop insurance products such as crop hail protection.

The transaction is subject to regulatory review and approval, and closing is expected in the first quarter of the 2015 calendar year.

In other year-end Deere news, CEO Sam Allen asked the company’s board to cut his 2014 cash bonus by 25%. The board honored Allen’s request, reducing by $1.8 million the total payment amounts he otherwise would have earned. Allen’s total compensation for the company’s fiscal year ended Oct. 31 rose 5.9% from last year to $20.3 million. S