3 Vital Facts About Farm Insurance You Need to Know

The farm insurance policy gives you coverage for damage to farm buildings, machinery, produce, supplies and livestock. There’s no serious difference between farm insurance and livestock insurance except for the things they cover.

Here are the three things you need to know about farm insurance policies.

1. Some Farming Activities Are Covered By Standard Homeowners Policy

There are individuals out there who treat their large garden or small farm as a hobby and have no intention of making money from it. If you are one of such people, it’s possible that your standard homeowners insurance policy will cover some of these farming activities.

But, bear in mind that homeowners insurance policies generally exclude things like farm equipment and farm outbuildings.

Ensure you speak with your local insurance agent near you to find out exactly what coverage your homeowners policy provides.

2. Are You Farming for Profit? Get a Different Type of Farm Insurance Policy

Hobby farming for a profit requires different coverage than your basic homeowners policy.

Here are some of the few guidelines that must be followed for a farm to be considered a hobby farm :

Coverage is limited to a single farm location

There must be no employees

Less than 500 acres

Total annual farm receipts are limited to a maximum of $10,000

Minimum coverage of $125,000 on the main dwelling (mobile homes are not eligible)

3. Get Farm Owner’s Policy If Farming is Your Full-Time Occupation

You will need farm owner’s insurance coverage if you want to take your farming hobby even further and start farming as a full-time occupation. A basic farm owner’s policy generally includes property coverage, liability coverage, and more.

To better protect your livelihood, this basic coverage should be modified with endorsements based on your farm’s unique needs. Your local insurance agent near you can help you determine what types of endorsements that will best fit your farm’s needs.