Farm and ranch insurance protects you, your home and your agricultural or livestock operation. It is a combination of a standard homeowners policy and a commercial insurance policy, since farmers and ranchers often live and work on their property. A loss in that circumstance can be more than personally devastating, it can be financially crippling as well. This guide will help you determine if you need farm or ranch insurance by walking through three factors, and then explaining how to obtain the policy.
The first step in determining whether you need farm or ranch insurance is knowing if you live on one. A standard homeowners insurance policy might not give you adequate coverage if you do. To help you decide if you need a farm or ranch policy, we’ve broken down some determining factors. If you answer “yes” to any of the questions below then you likely need a farm insurance policy.
Additional structures: Are there additional structures on your property, other than a pool or a garage? If so, you might need a farm insurance policy. Typically, additional structures that would be covered by a farm policy include barns, sheds, stables and other buildings. If you are using a small building, such as a garage or greenhouse, to grow crops or plants for sale then you should consider a farm insurance policy. However, if the revenue from the commercial activity does not surpass the incidental income limit of your homeowners insurance policy, you do not need a farm or commercial insurance policy.
Types of animals: Have something larger than a dog or cat? Many people have pets or animals but what types you have, and especially what you do with them, helps determine if you need a farm insurance policy. For example, even stabling a few horses for someone can create a business exposure to the policyholder - a situation that might call for farm insurance.
You probably don’t need farm insurance if you you have only a few hens or a pet pig. Again, even if you were selling the eggs the hens were laying or planned to sell the pig for slaughter, it’s unlikely the revenue would surpass the incidental income limit of your home insurance policy. Once you scale it to a larger business, however, then farm or ranch insurance should come into play if you're looking for protection. You could purchase a pet health insurance policy if it were especially important to you - dogs, cats or other animals, including pet pigs are insurable.
Workers on the property: Does anyone work on your property? According to the 2012 U.S. Census, the average farm in the country spans 434 acres. That can be a lot for a single family to manage so, not surprisingly, many farms employ people to work at them. Whether they are harvesting agriculture or tending to livestock, workers are a liability if they are performing job tasks on your property. Some states even require there to be a workers compensation policy in place if there are two or more workers.
Once you’ve determined you need a farm insurance policy, you’ll need to speak to an insurance agent about purchasing one. Unlike many other insurance policies, you cannot get an accurate quote for farm or ranch insurance policy online. Most companies won’t even calculate a quote online - in fact, they urge you to speak to an agent shortly after you begin entering information online.
Farm policies are customized for each individual policyholder because of how greatly their needs vary from one another. An agent should visit the farm or ranch and survey it entirely to help you build a policy that is right for you.
Insurance companies customize farm and ranch policies to keep premiums low. If there were a general farm or ranch policy that covered everything, it would be astronomically expensive and provide coverages that many farms and ranches would not need. For example, one farm might not have any animals at all and another might have hundreds of animals. Those two farms would need very different insurance coverages.