A California vineyard takes legal action after federal agencies deny its insurance claim for weather-damaged grapes, spotlighting policy standards and industry practices.
A California grape grower is suing federal crop insurers after its claim for weather-damaged vineyards spanning 490 acres was denied over irrigation disputes.
Mid-Valley Investment Co., LLC, a Kern County farming business, has filed suit in the US District Court for the Eastern District of California against the Federal Crop Insurance Corporation (FCIC), the Risk Management Agency (RMA), and Pat Swanson, who heads both agencies. The case, filed August 1, 2025, centers on Mid-Valley’s assertion that its 2023 crop insurance claim was denied after severe weather affected its Chardonnay grape crop.
According to the complaint, Mid-Valley held a federal crop insurance policy - reinsured by AgriSompo North America, Inc. - covering approximately 490 acres of Chardonnay grapes in Kern County. The policy insured production and revenue from this crop against unavoidable, naturally occurring events, including drought, heat, frost, and hail. The complaint states that during the first half of 2023, the San Joaquin Valley experienced at least 10.6 inches of rain in the area of Mid-Valley’s Chardonnay grape crop, providing natural irrigation. Mid-Valley also reports that it received water deliveries from the Semitropic Water Storage District and used a drip irrigation system to apply additional irrigation water to its crop.
The complaint details that in March and April 2023, several severe weather events occurred, including hailstorms on March 21 and March 23, and freeze events on March 26 and April 4, causing substantial and widespread damage to the grape crop. Mid-Valley submitted a Notice of Loss or Damage to AgriSompo North America on May 9, 2023, with freeze as the primary cause of loss and hail as secondary. The complaint states that insurance adjuster Kelly Remick conducted an initial inspection and did not express concern about irrigation at that time. The complaint further states that Remick conducted three follow-up inspections throughout the summer of 2023, again confirming the widespread damage.
According to the complaint, in September 2023, Mid-Valley provided supporting documents for further assessment of its claim. On March 15, 2024, AgriSompo North America denied the claim, asserting that Mid-Valley failed to follow good farming practices by not sufficiently irrigating the crop. The insurer asserted that the lack of adequate irrigation severely affected crop production for the 2023 crop year. Mid-Valley claims that the crop had already been heavily damaged prior to the irrigation season and that the San Joaquin Valley experienced unusually high levels of rain during the 2023 crop growing season, offsetting the amount of additional irrigation needed. The complaint also notes that Tropical Storm Hilary delivered an additional 1 to 4 inches of rain in August 2023.
The complaint states that AgriSompo North America sent another letter on April 22, 2024, denying the claim for failure to follow good farming practices and detailing Mid-Valley’s right to request a Good Farming Practice (GFP) determination from the RMA. Mid-Valley requested a GFP determination, and on August 28, 2024, the RMA upheld the denial, stating that Mid-Valley did not apply sufficient irrigation throughout the 2023 growing season, resulting in an uninsurable crop loss. The RMA’s determination referenced a publication, “Water Management for Grapevines,” to support the claimed water requirement for the crop. The RMA indicated that the water requirement for a mature vineyard varies from 22 to 28 inches, depending on canopy size, and that winter rainfall provides three to six inches toward this requirement.
The complaint challenges the RMA’s calculations, arguing that only pre-harvest water requirements should be considered and that the agency misclassified the vineyard’s canopy size. Mid-Valley also alleges the RMA failed to account for the full extent of rainfall during the growing season.
Mid-Valley is asking the court to reverse the denial and order the claim processed and paid, arguing that the decision was arbitrary, capricious, and not supported by the evidence. The company maintains that the real cause of loss was the hail and freeze events, not its irrigation practices.
While the court has yet to weigh in, the case brings to the forefront the ongoing challenges in interpreting crop insurance policies and resolving disputes between insurers and commercial growers—especially when weather, farming methods, and regulatory standards collide. For now, the details remain allegations from Mid-Valley’s complaint, but the dispute underscores just how complex and contentious agricultural insurance claims can become in the face of unpredictable conditions and evolving industry standards.
Source - https://www.insurancebusinessmag.com
