Farming isn’t one of those straightforward professions that any average Joe can tackle. Simply put, it’s hard work – like really hard work. Operating a farm is beyond intimidating and challenging, but arguably one of the most necessary and rewarding jobs on the planet.
As someone who belongs to the demanding Ag industry, you know there’s more than enough on your plate while you’re working to put food on the tables of others. Why add “figuring out my farm insurance blueprint” to the growing to-do list? After all, building an insurance policy to cover a farm and all its moving parts adequately is far from simple. You’re not a hobby farmer – this isn’t a side gig to you. Operating your farm is your moneymaker, your way of life. Because your farm generates income, it will need far more complex coverage than a standard home insurance policy can offer.
Farm insurance is designed to cover you both personally and commercially. Just as home insurance safeguards your dwelling, possessions, and personal liability, farm insurance provides all of those coverages plus protection for your machinery and livestock exposures. To understand the level of insurance coverage your specific farm needs, you’ll need to familiarize yourself with the three levels of forms that underwriters use to match your farm with a compatible policy type.
Farm insurance coverage forms are broken up into three categories: Basic, Broad, and Special. As you could venture to guess, Basic Form coverage is the most restrictive level, with Broad and Special Form coverage offering greater defense against threats to your farm.
Basic Form Coverage: Protection Against 10 Perils
- Fire, lightning, wind, and hail
- Collision
- Damage in course of transit
- Explosion
- Riot and civil commotion
- Sinkhole collapse
- Smoke
- Theft/Vandalism
- Vehicles
- Volcanic Action
Broad Form Coverage: Protection Against 25 Perils
Includes all the basic coverages above, plus the following:
- Accidental discharge and leakage of water system
- Accidental shooting of livestock
- Artificially generated electrical current
- Attacks on livestock by dogs or wild animals
- Glass breakage in a building or structure
- Bursting of heating or water systems
- Collapse
- Electrocution of livestock
- Falling objects
- Flood loss of livestock
- Freezing of plumbing, heating, AC, automatic fire protection system components, and household appliances
- Loading and unloading accidents
- Sudden and accidental collision damage causing death of livestock
- Sudden and accidental tearing apart of heating, AC, or water system
- Weight of ice, snow, and sleet
Special Form Coverage
Special Form coverage does not specifically list perils; instead, it is “all-risk” coverage unless otherwise excluded by your policy. In other words, unless the policy states a peril isn’t included, it’s included and should cover your potential loss. Typically, Special Form coverage is the preferred level of protection you’ll want for your farm. But because it is more comprehensive coverage, many companies will require that your property has certain updates.
Home & Contents
The primary residence you and your family occupy on the farm is covered by a structured portion of your policy specifically for your dwelling and personal property filling the space.
Farm Personal Property & Structures
It’s no secret that the equipment you use every day to perform your vital job isn’t easy (or cheap) to replace. That’s why each policy in our Farm Program comes with the best protection to ensure your farm machinery and equipment are covered in the event of a loss.
Whether big or small, your farm likely has multiple buildings on the property. The Farm Personal Property & Structures portion of your policy includes those structures aside from just your house. Machine sheds, detached garages, grain bins, barns, hoop buildings, other outbuildings, and the equipment stored in them would also fall under this coverage.
Farm Liability
Farm Liability coverage protects your assets in the event a lawsuit is filed against you. Accidents can undoubtedly happen more often than not around the farm. A potential liability claim can be costly and damaging to your operation. With a healthy, totally customizable Farm Liability reserve worked into your policy’s coverage guidelines, you can rest a bit easier knowing you’re protected from expensive bodily injury claims or accidental property damage claims.
Livestock
From dairy cows and hogs to beef cattle and sheep, your livestock are substantial investments — so they require their own specific coverage under your farm policy. Accidents, sporadic Missouri forecasts, and crimes are all unpredictable. That’s why knowing your livestock are protected from the unexpected, thanks to your farm insurance, is so comforting.
Equipment Breakdown & Service Line Coverage
Equipment Breakdown & Service Line Coverage come with all our farm policies by default. This means, unless the farm policyholder opts to have these beneficial coverages removed, they can be utilized to compensate the insured in an applicable claim scenario. Equipment Breakdown coverage can protect you from losses caused by electrical or mechanical breakdown. And as you know, breakdowns can be a pretty common occurrence during a farm workday. Service Line coverage protects the underground pipes and wiring servicing your residence on the farm.
New Construction Credit
Policies in our Farm Program provide a New Construction Credit to newer farm homes in generous amounts ranging from 3%-20%.
Winter Livestock Perils
CFM provides special coverage for livestock, including our Winter Livestock Perils endorsement. This endorsement covers your cattle, sheep, swine, goats, horses, mules, and donkeys if they are affected by common threats like freezing or smothering in a snow or ice storm or falling through ice at your farm’s pond during the winter.
CFM Farm Machinery Blanket
A relatively new addition to our Farm program is the CFM Farm Machinery Blanket.
CFM Insurance Underwriter Insight: The CFM Farm Machinery Blanket gives the insured and agent the easability of not having to update the scheduled machinery list on the farm policy each time a piece of equipment is sold or traded. Blanket coverage provides all the same coverages as ‘Described Machinery’; the only difference is the equipment isn’t listed line-by-line. An updated list of farm machinery and equipment needs to be sent in every three years by the policyholder and agent. It’s a great option for farm policyholders who have a large amount of equipment and trade or buy new equipment frequently. Combines and irrigation equipment are excluded from the blanket.
Farm Loss of Income Coverage
Farm Loss of Income coverage can be added on to any of our CFM Farm policies. This valuable coverage pays for the actual loss of farm earnings normally incurred and earned by a farming operation, should the business be interrupted by direct physical loss to farm buildings, machinery, equipment, or supplies. This option also provides coverage for the necessary extra expenses incurred to resume or continue the farming operation as nearly as practicable.
Grain, Hay & Other Farm Supplies and Products Coverage
Grain, hay, and other farm supplies and products (stored in buildings or in the open) are covered under this portion of your farm policy. Hay, straw, and fodder in one area is considered one stack if separated by a clear space of 100 feet or more from any other hay, straw, or fodder in the open. If no specific “limit” is shown on the declaration page of your policy for any one stack, the maximum coverage per stack of hay, straw, or fodder in the open is $40,000.
ATV/UTV Coverage
When you live on a farm and need to navigate the land a little quicker than you could on foot, it may be beneficial to add an ATV or similar mode of transportation to your farm inventory. Through our Inland Marine endorsement, your four-wheeler or side-by-side would be covered up to the amount it’s worth.
Are you looking to update your farm insurance? Head over to our blog for a complete breakdown of all CFM Insurance Farm Programs and a list of CFM Farm Discounts, including an exclusive discount for MO Soybean Association members.
*All listed coverages above are based on CFM Insurance Farm Programs.
