What Are the Risks of Not Having Farm Insurance?
Caeva O'Callaghan | June 24th, 2021
You need to have farm insurance if you operate a farm – if you don’t, the consequences will not be worth it.
If you own a farm and don’t have the right insurance you risk losing everything you own, your business, your livestock, as well as putting the safety of others at risk.
Without insurance, it is unlikely you will be able to repair or replace anything that has been lost. And if you are found liable for an injury or loss of life on your farm, the consequences will be dire indeed.
In this article, we’ll discuss the following questions:
- What does farmers’ insurance cover?
- What happens if someone has an accident on my farm?
- Is there anything else I need to insure on my farm?
It’s always in your best interest to make sure you are properly insured.
What does farm insurance cover?
Farm insurance will cover what is stated on the policy. At its most basic level, farm insurance will cover you for public liability on your land. You may also add cover for your farmhouse, its structure and its contents.
Once you find your perfect standard farm insurance policy, you can start adding on the extra cover you need.
Common add-ons for farm insurance include:
- Cover for outbuildings, sheds and barns
- Livestock insurance
- Loss of milk and produce
- Agricultural vehicles and machinery
- Employers’ liability (if you have regular workers)
Insurable risks include fire, storm and flood, which will apply to any extra insurance you have on outbuildings and sheds. If you do not have farm insurance, there is no one to help you cover the hefty costs involved if your property is destroyed.
What happens if someone has an accident on my farm?
At a minimum, your standard farm insurance will cover public liability. This is the most important section of any insurance policy, as it covers damage or injury to members of the public and their property. If you employ others on your farm, you need to ensure they have their own insurance (if they are agricultural contractors) or that you cover them with an employers’ liability section added onto your policy.
This is because if someone has an accident on your farm and you have no insurance, you could end up losing everything.
For example, say you have a young casual worker helping you on the farm and he is gored by a bull during the course of his work. He has a young family at home, and his widow takes an action against you for negligence.
If you do not have an insurance company to help you defend yourself, appoint a legal team and attempt to settle and pay the claim, you could lose your entire farm and livelihood.
Claims of this nature can easily run to seven figures, particularly if there are young children involved. The compensation the surviving family will be awarded will need to equal the deceased employee’s future earnings.
So you see, if you decide to save a few euros per month on a relatively cheap insurance policy, you may end up owing the earnings of a lifetime if the worst should happen.
Is there anything else I need to insure on my farm?
In addition to a standard public liability policy, it’s always in your best interest to include any tools, machinery, livestock, outbuildings and supplies when setting up your insurance.
When you insure agricultural machinery and equipment, they will usually be covered for fire and flood as well as theft. You need to ensure you keep valuable equipment and vehicles safe from thieves as well as adverse weather conditions. If you neglect your equipment, your provider is unlikely to process your claim successfully.
You may also add business interruption cover to your policy, which will help cover costs in the event that you are unfit to work or if unforeseen circumstances mean your farm cannot operate as normal. It’s worth noting that as the farmer or business owner, you will not have cover under employers’ liability insurance or public liability insurance if you are injured. This is because this insurance is specifically only to cover your employees and other people on your farm.
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All Information in this post is accurate as of the date of publishing.