Things to Consider When Considering Farm Insurance

Posted 05/08/2015

Why do I need farmers insurance?

When purchasing farm insurance then there may be more to it than you think and you need to ensure you have the correct cover as you are essentially insuring your entire livelihood. Your farm insurance should cover every aspect of your farm, including your home (or any other on-site dwellings), the contents of said dwelling as well as any other buildings or equipment, all of your livestock, farm property such as your vehicles and any other farm buildings such as pens and sheds.

Farm insurance covers everything that makes your farm a farm and it is important that you consider everything because what you are doing is protecting the very things that you depend on to live. There are lot of things that have the potential to go wrong and if your farm was to suffer a disaster such as fire or flood and it was not insured then in a worst-case scenario it could be the end of your livelihood.

The different aspects of farm insurance

Farmers insurance comes in many different shapes and sizes and there are many different policies that cover a huge range of things. Some insurance policies look good and might be cheap, but have many exclusions that makes them useless if certain things happen. For example some covers do not cover water damage and some, surprisingly, do not even cover theft. There are many things that need to be considered when insuring your farm and these few critical points are the things that you need to consider the most when it comes to insuring your farm:

• Peril Insurance – Insurance for farm equipment and buildings is much the same as normal insurance, with the policy paying out if your equipment suddenly broke for example, or if your farm burnt down or any of your equipment caught fire. This is where policy exclusions can be the most prevalent, with most policies only covering certain aspects and excluding some of the more common instances where the cover is actually needed. You can pay for an extended premiums cover for your farm and this will cover every aspect of any damage to your property. Although higher cost than a more basic cover, it provides a greater blanket of security for your farm.

• Employer’s Liability – This covers any employees that you have on your farm. When you employ someone to work on your farm you are legally obliged to take out this cover to protect yourself if the employee gets injured or killed due to working on the farm. It is a good idea to ensure that you are suitably covered and although it may sound unlikely there are actually many more cases of injury on a farm than you may think. Farms are dangerous places and there are hundreds if not thousands of injuries on farms yearly.

• Public Liability – protects you if someone visits your farm and injures themselves on site, or if you are being help responsible for the damage of someone else’s property. The standard cover for public liability insurance is £5m, which should cover you for most eventualities that may occur. Additional cover, up to £10 million is also available.

• Environmental Liability – you are legally liable for any and all clean-up costs if you were to accidentally contaminate your land, or any surrounding land. Most covers hold environmental liability cover of around £1m, however it is important that you check what cover you are getting to ensure you have sufficient cover.

• Your Livestock and Crop – Livestock and crop are often the most valuable parts of an entire farm’s assets. If all of your livestock were to catch foot and mouth then you would be financially challenged for the season. You can take out cover on livestock and crops to ensure that even if something were to go horrifically wrong, that you would still get your seasons yield. This will protect you if your livestock was stolen or escaped. Extended cover is available to insure you if your crops and livestock do not perform as they were predicted to and you could receive compensation a pay out if your livestock do not birth a reasonable number of offspring.

What Could Happen if You Are Underinsured

If you take out insufficient farm insurance then there could be numerous implications that could negatively impact your farming business. For example, owning 200 cows but only insuring 100 of them could see you losing all claim to compensation if all 200 were killed due to disease as the insurer could choose to avoid the policy from inception and cancel and refund all premiums, meaning that you would not even cover the 100 cows in the first place.

It is important that you calculate the value of possessions and assets to get the right level of cover for your particular farm, as if something were to happen then you could find yourself very quickly wishing that you had paid that little bit extra a month for the extra cover you need. You are thinking about your entire life when taking out farm insurance, and it is your responsibility to ensure that your insurance appropriately covers the full costs of any potential disasters that may occur. Your life is heavily dependent on the success of your business, and losing your farms assets without the financial backing to get your farm up and running again can be disastrous.

If you want to find out more on our comprehensive farm insurance cover which offers a range of policies and cover types then please request a callback, contact us on 01603 262 610 or email us on

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Things to Consider When Considering Farm Insurance
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