Farm Owner’s Insurance refers to policies that provide commercial property and liability coverage and also homeowners’. Typically, farmers avail both residential and commercial coverage as the policies involved pertain to family and farms that are operated individually, not the huge farming operations for commercial business.
It is a form of insurance that combines two in one coverage to protect the farmers. With its personal coverage, it’s just like homeowner’s insurance where your home and valuable possessions are covered. It also has liability coverage that will fend for you in case of misfortunes you caused to others. Aside from these, it also covers your machinery and some of the animals on the farm.
Every farm has unique needs the reason why there are different coverages you may opt to purchase for a certain need. A standard homeowner’s insurance might cover a small farm if it’s for hobby purposes or you don’t intend to sell farm products for money. However, it might not cover farm machines and buildings so it’s best to avail farm insurance to protect your home and farm at the same time. An insurance agent might come over to evaluate the land to ensure the proper coverage for your property.
What does it cover?
Farm owners insurance protects the client in an event of damage and loss. It has personal property coverage and liability coverage that works on farming operations. It can be broadened depending on the client’s choice. There are some who choose to widen the coverage for specific needs. You can discuss it with the insurance representative or agent to estimate it for you.
Every business needs insurance but a farmer has other concerns and each farm has extraordinary needs and inquiries that only great insurers can answer. These include farm equipment coverage that covers tractors and threshing machines and other farm equipment. Another is crop coverage that covers the loss of crops due to extreme weather conditions, and livestock coverage that protects the farm animals.
- Farm equipment and machinery. This will protect you from loss of investment or damages to your farm equipment and machinery caused by specified risks in your policy. Examples are your tractors, plows, field equipment, rakers, and threshing machines. Portable structures, irrigations, and fences may be covered.
It is expensive and there’s a need for scheduling individually such as the tractor which is important in farmwork. However, think about the possible damage that will result in a big loss to your farm investments. For example, your tractor was damaged by a tornado or one of the machines by other disasters, a replacement for the said assets is too costly.
What about the other equipment that has been hit too? It will add up to the cost and will take away your earnings in a snap. Disasters cannot be controlled so it’s best to protect your investment from financial loss.
- Livestock. Some farmers consider their livestock as the most important asset and also vulnerable to risks such as sickness and death. It's up to the farmer what are the individual coverages he would purchase to protect the animals from some other perils that are not included in his policy.
There are perils though that need extra coverage like coverage against accidental shooting or if the animals were hit by vehicles, loss of livestock due to disasters such as flood and earthquake, and attack by other wild animals that will cause their death. Horses, on the other hand, have different coverages that can be purchased depending on how you see their purpose and what you see fit for the situations within your farm.
There’s animal mortality coverage due to perils, sickness, and theft; medical and surgical expenses and coverage for loss of use. Some insurance companies send agents that specialize in equine animals. Talk with the agent and ask for details to purchase within your limit.
- Farm products. Animal feeds, seed, fertilizers, and pesticides are part of farm products that are covered by farm insurance. However, seeds and grains aren’t covered already once they are planted and growing inside the property. It is because it would need a commercial insurance policy once the sales are booming and might surpass the income limit of your policy.
This is just like the liability coverage of a standard homeowner’s insurance. It covers damages, injuries, and medical expenses incurred. It is already part of the farm insurance and not just an option because there are possible risks that might arise during farming. In addition to this, even the professional fee of the lawyer who will handle the incident case is covered.
Experienced farmers may also suffer from sudden injuries and hurt themselves while running machines on his farm even with utmost carefulness. There are instances that animals escape and cause harm to others. You are still liable even if an accident happened outside of your property but still, liability coverage will protect you from this.
There are certain needs that you must consider when purchasing special liability coverage. There are cases where you will need coverage from food or products that you have sold and caused harm or illness to people. Aside from this, owning and operating a farm sometimes need to hire helpers that can be considered as your employees. There might be events that you will be held liable for what actions they might cause to other people’s property during working hours.
What Is Not Covered?
There are many risks that aren’t included in your standard policy. You might assume these coverages but talking to your agent definitely will help and might encourage you to customize the policy you presently have. Choosing the right policy coverage will depend on your needs.
Fencing. This isn’t covered by a standard farm insurance policy. Some farms have many fencing that measures too long while others don’t need it. The type of fencing varies from the material used and also the price that it entails, the reason why it might be pricey if you’d ever insure it.
However, the advantage of insuring your fencing must be considered if your farm is most likely to experience a tornado. It will fall under policy extension and your insurance can broaden your policy to some risks that aren’t specified with it. If you have electric gates, think about insuring it because the moment it is damaged, you’ll be spending a lot more to fix it or replace it with a new one compared to the price you need to spend on buying another policy coverage.
Uncovered perils. You must know the perils specified in your policy that will protect your equipment, machinery, farming tools, and assets. Not all types of disasters and events are covered so it may help to know these details with your agent or review your farm insurance policy.
Fire is covered by your insurance in general, but it has exemptions that you might need to ask with your insurer. Some of these exemptions include situations where there’s no access or it’s too far from a hydrant or pond that will supply the water needed to stop the fire. Another is if there’s no provided solid gravel roads going to a certain building or structure that may be burned in an event. Your agent will make an evaluation within the site and will take note of these points. Thus, excluding fire in the listed perils will likely to happen.
What Are The Benefits Of Farm Owners’ Insurance?
Most of the American farmers are older and it would be an advantage that whatever they own be insured to make sure that everything is in its proper place whatever happens. You might want to insure your valued property to free yourself from stress once mishaps happen within your land.
- Operating a farm becomes the source of your livelihood if not for a hobby. To protect your business investment, you need to ensure your farm that will protect your equipment and other farm assets from unexpected perils.
- The government offers subsidies to farmers that will lessen some portion from insurance premiums.
- You will most likely attain that loan from the bank or financial institution if you can show proof of being insured that will ensure them of your ability to pay.
- Having a farm owner’s insurance will ensure the longevity of your farm business.
Working your land is something you love to do and loving it means you want it protected. With the ever-changing world, you can never tell when an event might steal you the land and the assets you’ve been nurturing for a long time.
Owning a farm has its benefits not just to you or to nature, but most of all to other people that depend on the products a farm can produce. It may be a hobby to you or make it your source of income but remember that in order to safeguard your property, have it insured. Purchasing farm insurance is a form of security to your investment that will protect your valued wealth and the future goals you are planning to have soon.
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