Farm Bureau Mutual will be reorganised as a stock property and casualty insurance company named Farm Bureau Property & Casualty Insurance
Farm Bureau Mutual Insurance’s board of directors has approved a plan of reorganisation under which the company (Farm Bureau Mutual) will reorganise into a mutual holding company structure.
As per the required approvals, Farm Bureau Mutual will form a mutual insurance holding company to be named Farm Bureau Mutual Holding Company (MHC), and Farm Bureau Mutual will be reorganised as a stock property and casualty insurance company named Farm Bureau Property & Casualty Insurance Company.
Farm Bureau Mutual will also organise an intermediate holding company named Farm Bureau Multi-State Services. All Farm Bureau Property & Casualty Insurance Company shares will be owned by Farm Bureau Multi-State Services.
All Farm Bureau Multi-State Services shares will be owned by MHC. While there are no definite plans to sell stock to outside investors, the company may pursue such a sale in the future as a part of its business plan.
The terms of existing policies will not be impacted by the reorganisation, and related membership interests and rights under policyholders’ contract of insurance will remain unchanged.
Bruce Trost, executive vice president of Farm Bureau Mutual Insurance, said: “Historically, the earnings or profits from the business are cyclical in nature, which can make it difficult to plan future growth and expanded service to policyholders. The strategic flexibility and access to capital the reorganization makes possible will help position the company for a level of growth that surpasses what it could achieve as a mutual company.”