1:44am

Fri August 17, 2012
Planet Money

Competing Against The Nicest Guy In Town

Originally published on Fri August 17, 2012 1:36 pm

For more: Why does the government subsidize crop insurance in the first place? We try to answer that question in our latest podcast.

The federal government spends about $7 billion a year on crop insurance for U.S. farmers. Policies are sold by private companies, but the government sets the rates, so the companies can't compete on price.

That means the guys who sell crop insurance have to find other ways to compete. They try to out-nice each other. They are very charming. They wear polo shirts depicting hobbies. They have fun nicknames. And they know everyone in town.

Don "Dizz" Biefelt is the most interested, friendly neighbor you can imagine. He's 82 years old, and he sells crop insurance in Anchor Illinois.

I sat with him on Anchor's one public bench. His customers were everywhere. That guy over there, working on a truck — he's a customer. (And, by the way, the customer's wife just had a gallbladder out, Dizz says.) The guy in that house over there is another customer, as is the guy down at the end. Dizz knows their mothers, their nicknames, their wives' digestion problems.

But Don has competition. Brent "Hondo" Honneger works a few miles down the road. Brent also wears polo shirts and is charming and knows everyone.

The morning I meet Brent he has organized a Q&A session for farmers on how to file a crop insurance claim. Brent invited a bunch of Don's clients to this event. Just in case, he says, they're not getting all their questions answered.

Then he makes sure to stand by the door and personally greet each farmer:

There's one customer who Brent has been trying to poach from Don he's been trying to poach from Don for decades. "But he's like, 'I go to church with Don. I see him every Sunday.'"

Brent says he is always gracious. But he'll occasionally ask Don's customers a few questions about whether Don is keeping up with the times. "Does he mail everything still?" Brent will ask. "He's still operating like we operated 20 years ago."

Government subsidies for crop insurance have set the stage for thousands of tiny popularity contests in small farming communities all across the country.

Right now, in the worst drought since 1956, most farmers have generous insurance coverage, and I can confidently report they're getting very good service.

For more: Why does the government subsidize crop insurance in the first place? We try to answer that question in our latest podcast.

Copyright 2012 National Public Radio. To see more, visit http://www.npr.org/.

Transcript

RENEE MONTAGNE, HOST:

Crop insurance is America's biggest farm subsidy. And as the drought drags on, farmers in the Midwest are calling their crop insurance agents. So today, our Planet Money team introduces us to this one corner of the farm economy that just became extremely relevant. Here's NPR's Chana Joffe-Walt.

CHANA JOFFE-WALT, BYLINE: Crop insurance agents are an amazing group of people to get to know. It's in the job description, or something. You have to be charming; you have to wear a polo shirt, preferably that depicts a hobby; you need to known by a nickname - Shorty, Rube, or in Don Biefelt's case, Dizz. Don - or Dizz - is 82 years old and lives in Anchor, Illinois.

DON "BIZZ" BIEFELT: I started out by writing all of the stuff - cars, and all that Mickey Mouse stuff - with a briefcase. And then I've - got into a niche market of basically, crop insurance

JOFFE-WALT: Don sells crop insurance to farmers in Anchor, and all the little towns nearby. He's a fan of talking; also, asking himself questions that he then proceeds to answer.

BIEFELT: Crop insurance: The only advantage and - different about crop insurance, than any other insurance, is what? All the prices are the same. It makes no difference what company, or anything; all the prices are the same.

JOFFE-WALT: All the prices are the same because the U.S. government sets the rates. Crop insurance is a very peculiar business because the government - meaning, you and I - spend about $7 billion a year on it. We pay private insurance companies to sell crop insurance. We pay farmers to help them buy their policies. And then the government sets the rates, which Don says for an insurance guy, makes things really weird because you can't compete on price.

BIEFELT: And that's unusual. Usually it's a price war, you know, sometimes. So what's left? Service.

JOFFE-WALT: And this, it turns out, is why crop insurance agents tend to be these powerful personalities. That's their job - to get your attention, and then win your affection. That's all they've got to work with. So when you sit down with Don on Anchor, Illinois' one public bench, he is the most interested, friendly neighbor you could ever imagine.

BIEFELT: That's Mr. Lee Clemers. He's one of my insureds - right there, working on that truck. His wife just had her gallbladder out, so she...

JOFFE-WALT: Don knows everyone - Jon Mauk, over there in the first house, he says; Brian Simpson, down at the end. He knows their mothers, their nicknames, their wife's digestion problems.

BIEFELT: I never have made a nickel on advertisement. Isn't that weird?

JOFFE-WALT: But Don has competition. There are 16,000 crop insurance agents in the U.S. right now, selling an identical product to farmers; although for Don, competition is extremely local - 12 miles down the road.

BRENT "HONDO" HONNEGER: Brent Honneger. And I say, I know crop insurance as well - or better - than anybody out there.

JOFFE-WALT: Brent is also a talker, also wears polo shirts, also knows everyone, and has a nickname - Hondo. In other words, it's very hard to see what Brent has to offer that Don does not, although the morning I meet him, he has organized a Q&A session for farmers, on how to file a crop insurance claim. And it is a big hit.

HONNEGER: Come on in; grab a cup of coffee.

JOFFE-WALT: Brent invited a bunch of Don's clients to this event - just in case, he says, they're not getting all their questions answered with Don. And then he makes sure to stand by the door, and personally greet each farmer.

HONNEGER: Like this guy - he's an awesome golfer.

UNIDENTIFIED FARMER: Ah, you playing tomorrow?

HONNEGER: No, what's the - what's tomorrow?

JOFFE-WALT: Imagine if your car insurance agent knew your favorite hobbies, foods, the names of your children; and when you had a question, he or she would come to you, at your convenience. All the farmers in this room tell me, that's just how crop insurance agents are. And Brent says it makes for stellar customer loyalty. Once you get a client, they never leave. But it also means it's impossible to win over new clients. There's this one guy he's been trying to poach from Don, for decades.

HONNEGER: But he's like, you know, I go to church with Don and, you know, I see him every Sunday.

JOFFE-WALT: Brent says he's always gracious about this. But he will occasionally mention that Don's been doing this for a while, and does he even own a computer?

HONNEGER: Does he mail everything still? And - like reporting claims, he calls them in; and he's operating like we operated 20 years ago, so - back when he was 63.

JOFFE-WALT: Government subsidies for crop insurance have set the stage for thousands of tiny popularity contests, in small farming communities all across the country. And right now, in the worst drought since 1956, most farmers have generous insurance coverage. And I can confidently report, they're getting very good service.

Chana Joffe-Walt, NPR News. Transcript provided by NPR, Copyright National Public Radio.

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