Farm and ranch insurance is a coverage tailored specifically for farmers and ranchers. The policy is a hybrid with both homeowners and commercial insurance elements since ranchers and farmers live and work on the same property. The policy covers the home, personal property, additional living expenses, outbuildings, scheduled farm personal property, unscheduled farm personal property, and liability coverages. Many types of Farms/Ranches are typically covered under this policy and a few are listed below:
- Cattle Ranches
- Horse Farms
- Fruit and Vegetable Growers
- Hay, Grain and Row Crop Farms
Farm Property Coverage includes coverage for the residence, other private structures, household personal property, additional living expense, scheduled farm personal property, blanket unscheduled farm personal property and other farm structures.
Farm Personal Property Covered is 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.
Farm Machinery and Equipment coverage protects the policyholder from financial loss or damage of their machinery and equipment due to covered perils. It can either be scheduled or non-scheduled under a blanket limit. Tractors, combines, cotton pickers, planters, field equipment, hay rakers and other machinery are all more expensive and should be scheduled due to their size and value. Smaller pieces of equipment do not have to be scheduled however, the blanket limit of coverage should be equal to the value of the total of all unscheduled farm equipment and/or machinery in order for it to adequately covered.
Portable irrigation equipment, portable structures and fences must be scheduled for coverage to apply.
Farm machinery and equipment is only protected by perils explicitly listed in the farm policy. Equipment that is not well maintained will not be covered and technical malfunctions are not covered. Like many things, farm equipment is getting increasingly technically advanced and unless you purchase a specific extension, it might not be covered.
Livestock coverage is offered under most farm insurance policies offer broad coverage of livestock in the event they are killed or injured because of a basic peril that is named in the policy. There also are extensions that cover a much wider array of perils that that can happen to farm animals.
Animal mortality coverage, which covers death due to a broad number of perils. 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 do not.
Farm Products include Feed, grain, seed, hay and similar items considered farm products and 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 called Crop Insurance.
Farm Liability Coverage covers bodily injury, property damage, personal injury, advertising injury and medical expenses. Farm operations have an increase in the exposure due to livestock, equipment, fields, and outbuildings. Even under the most strenuous precautions, accidents can occur such as an animal escaping, wander into a roadway and cause an accident. Even though that incident didn’t occur on the property, the animal’s owner would be liable. Animals can escape and cause automobile accidents along public roads.
Environmental impairment liability is an exposure from waste polluting the air, land, or water, or underground storage tank exposures from fuels. Off premises exposures include animals being transported or exhibited at a trade show or a fair. It also includes overspray of chemicals used in farming operations. It is important to make sure this coverage is addressed as large losses could occur due to this exposure. Environmental impairment liability picks up cover for these types of exposures.
Automobile exposures are broader on a farm and ranch policy as drivers consist not only household members driving owned, rented, or borrowed vehicles or from loaning their vehicles to others outside the household, but employees also as they drive the insureds vehicles during the course of their daily activities. It is important that all drivers and vehicles are listed on the policy, and the usage is properly identified to ensure proper coverage.
Workers compensation coverage applies to farm and ranch workers. The exposures on the farm include heavy lifting, handling of livestock, using equipment, contact with pesticides and herbicides, excessive noise, and noxious odors from animal waste. The work can be dangerous; examples of losses include: workers falling into grain bins and suffocating or be injured while driving on public roads. Therefor it is important for the farmer/rancher to have coverage for the workers, which will pay for injuries and lost wages, should a worker become injured on the job.
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