Overview of Farm and Ranch Insurance
When considering an insurance program for your farm or ranch operations, it is extremely important that your agent is experienced in this area. There are a lot of hidden risks when it comes to farm and ranch, from the 2 acre hobby farm with a few small animals, to a large row crop operation, insurance exposure for these types of risk can get very complicated if you do not know what to look for. In this review, we will not be able to delve off into every single possibility of exposure but we will touch on some of the major things that you do not want to overlook.
The importance of general liability coverage
General liability coverage for all acreage and farm locations is important to have listed on the policy. In almost all cases, you will be transporting equipment, commodities, or product from one farm location to another. For any livestock that is under your care, custody, and control, you are also liable. Examples may include an injury resulting from an animal’s behavior or an animal getting out of the area in which it is held due to poor fencing conditions. If an animal escapes and is struck by a vehicle you could be liable for the bodily injuries as well as the property damage that occurs. As you can imagine, a situation like this can get very complicated and costly.
Protecting your buildings
It is almost certain that in a farming operation you will have farm structures that service the farming operation. That maybe a hay barn, equipment shed, tack room, grain silo, farm office, and the list goes on and on. In most cases, these items must be listed on your policy to have coverage for them. Be sure to check with your agent to make sure your items are listed. We often see the small hobby farmer may think all of their buildings are automatically covered on their homeowners insurance. This is most often not the case. Most homeowners policies read that for an outbuilding to be covered it A.) Is in the area maintained as a yard B.) Services the residence dwelling C.) any signs of farm operation excludes it from coverage on the homeowners policy. Check with your agent to make sure you are covered.
Farm equipment is another broad topic from a small implement to a large combine. Coverage amounts can be as little as $100 in value to well, the sky is the limit. If you want individual coverage for your tractors, implements, tools, and livestock, you will need to schedule those things individually.
Common Farm and Ranch endorsements
When it comes to farm exposures, companies that are truly great Farm and Ranch insurance carriers will offer a wide variety of additional endorsements to broaden coverage based on specifically what you need as a customer. Here is a list of a few endorsements that are common and provide much needed coverage:
- Herbicide Overspray
- Fire Legal Liability
- Hay Coverage
- Livestock Mortality
- Farm Employee Liability
- Farm and Ranch Auto
- Farm and Ranch Umbrella Coverage
- Miscellaneous Coverages (Boat, ATV’s, etc.)
- Farm Product Liability
These are just a few examples of some specialized coverage options that could be available. As you can see, the farm and ranch category can be very broad, very comprehensive, and very confusing. We strongly recommend you contact an agent that has experience in the farm and ranch industry to review your coverage. It is also extremely important that you review your coverages with your agent on an annual basis or at any time during the year that there is any change in your operation.