Your farm is your livelihood, and you can never be too cautious. Since an accident or setback can happen when you least expect it, it’s essential to be prepared when potential problems arise.
Farms of all types need to be covered with farm insurance. By being proactive with the proper farm policy, your equipment, buildings, and even lost income can be covered if an unforeseen circumstance disrupts your operations.
What is Farm Insurance?
Farm insurance is designed to protect a variety of different types of farmers should a catastrophe occur. The main purpose is to make sure your farm is able to recover and stay in business.
If you are a hobby farmer with a large garden, your homeowners’ insurance may be modified to cover your production and the areas used to support it.
It potentially would also cover any outbuildings and equipment. When you start selling at local farmers markets or scale up production to a professional level, that is when farm insurance is needed most.
What Can it Cover?
There are certain policies which cover hobby farms.
The requirements for being a hobby farmer are:
- having less than 500 acres
- no one employed by the farmer
- cannot earn more than $10,000 annually
The coverage options differ for full-time, professional farmers. These policies contain liability coverage and insurance on the property itself.
As all farms are different in the way they operate, there are special amendments available to cover the unique aspects of a farm’s operations.
Crop and livestock insurance are types of policies that you may want to consider. They are both similar types of coverage.
Also, the US Department of Agriculture (USDA) partially funds them.
Livestock coverage covers animals on the property, except horses. As horses are bred for showing or wrangling cattle, they may need a separate policy.
Individual and blanket policies are the two primary types of policies.
Individual insurance policies are designed to cover animals that have a high value. These are written for a specific dollar amount.
On the other hand, blanket policies provide coverage for the whole farm in one document. This includes coverage for buildings, equipment, and livestock.
When considering a blanket policy, it’s important that you are sure that you have enough coverage.
It can be devastating after a disaster or accident to discover that the values for property and equipment were incorrect. This leaves you underinsured which can be financially painful and slow the farm’s recovery.
What Does it Not Cover?
Farm insurance covers feed, grains, seeds, etc. while they are being stored. It does not necessarily cover plants which are growing in the field.
This is why it is important to talk with your agent to get the coverage your farm needs.
Are there Policy Limits?
As with any insurance policy, it depends on the size of the operation and the type of insurance you decide on. There will be limits, so it’s important to ensure that there is adequate coverage in place.
Farm insurance is an important part of the business of running an agricultural business.
Do the research, assess the farm’s needs, and talk with a knowledgeable agent to get the coverage you need.
Why Choose Kenneth Rhodes & Associates
Whether you’re a local grower or a large cultivator, we understand the value of insuring your greatest asset.
At Kenneth Rhodes & Associates, we’re dedicated to providing the agricultural coverage and services you need to keep your farm or ranch protected, so you can focus on maintaining a smooth operation.
Whether you own or rent, have a large or small operation, or raise crops or livestock, we can expand and tailor policies to help meet your unique situation.