What does a farm insurance policy cover?
Farm and ranch insurance also covers personal property directly related to the farming or ranch operation. This portion of the coverage can typically be broken down into three categories: farm machinery and equipment, livestock, and farm products such as seed, silage, animal feed, fertilizers and pesticides. Most farm insurance policies allow policyholders to choose broad coverages over the categories or to schedule individual items (these options work similarly to endorsements and floaters). You choose which is best for you when you speak to your agent and purchase the policy. Whether you choose to broadly cover categories or individually schedule items, we’ve broken down coverages under this portion of a farm insurance policy.
Farm Machinery and Equipment
This coverage protects the policyholder from financial loss or damage of their machinery and equipment due to covered perils. Almost everything you might guess that falls under this category is covered. Tractors, combines, cotton pickers, planters, field equipment, hay rakers and other machinery are all covered. If you use a truck for farm work, you may be able to bundle a commercial auto insurance policy and add it to your overall farm insurance package. Portable irrigation equipment and portable structures and fences are usually covered as well.
Farm and ranch machinery is expensive and some of it will need to be scheduled. Farm tractors can cost more than $200,000 but they are necessary investments for many farmers. As durable as they are, a lot can happen to them. For example, say a tornado damages a tractor. There is little the owner can do to prevent that peril so they need to protect themselves financially against the loss of such an expensive piece of equipment with farm insurance.
Most farm insurance policies offer broad coverage of livestock in the event they are killed or injured as a result of a basic peril that is covered. There also are extensions that cover a much wider array of perils that that can happen to farm animals. Some of the extended policies cover things such as the death of animals by accidental shooting or if they are struck by a train or vehicle. They also might cover attacks on livestock by dogs and wild animals, as well as flood and earthquake loss of livestock.
Horses and equine animals are unique because of the variety of purposes they serve. Whether you use one or more horses for work, breeding, show or pleasure, the animals are investments that make financial sense to purchase insurance for. Companies that offer farm and ranch insurance employ special adjusters specifically for equine animals and offer a list of purchasable options to cover them. Choosing what protection is most appropriate is a decision you make with your agent.
Typical coverage options for horses include animal mortality coverage, which covers death due to a broad number of perils and theft. Perhaps more importantly, the option also covers death due to sickness and disease – this is a unique covered peril that standard livestock portions of farm insurance policies does not. Other livestock options for horses include major medical expense, surgical expense and loss of use coverages. What purpose the horse serves the policyholder determines which of the options you need to purchase. For example, say you ride your horse to herd other animals. That horse is probably a vital part of your livelihood so you need to protect that asset with insurance in the event of perils, accidents and disease. A horse you have purely to ride for pleasure might not require extensive coverage.
Feed, grain, seed and similar items considered farm products are covered by farm insurance. Remember these products are only covered while stored. Feed or grain (or other crops) growing on the property and seed that has been planted are not covered – those would typically require a commercial insurance policy if the sale proceeds exceed your policy’s incidental income limit.
Farm liability coverage
Similar to a standard home insurance policy, farm and ranch insurance also provides liability protection. Liability coverage is not an option and part of every farm insurance policy because of the risks at hand. It covers bodily injury, medical expenses and property damage if necessary. Perhaps just as important, it covers attorney’s fees associated with covered incidents as well.
Even under the most strenuous precautions, accidents can occur. Farmers with years of experience operating machinery can misstep and hurt themselves. Something could startle an animal and cause it to injure a senior handler. Or for example, say an animal manages to escape, wander into a roadway and cause an accident. Even though that incident didn’t occur on your property, you as the animal’s owner would be liable.
If you have any questions about Farm and/or Agribusiness insurance in Avon or Central Indiana, fill out the request form on our contact page. You can also reach our staff at (317) 272-1010 or our contact form for more information.