Farmers and Ranchers Need Livestock and Other Insurance Protection to Help Rebuild After a Loss

Business owners of all kinds invest in insurance to protect their livelihood, but many farmers and ranchers forego insurance for their animals to avoid the expense, confident in their belief that losing a few animals every year doesn’t justify the cost of insurance protection. But what if the worst-case scenario actually happened? Consider the case of the early South Dakota blizzard last year, where entire herds were killed or displaced. Could you recover if you lost your entire herd? Is your region prone to unpredictable weather?

Farmers and ranchers need some form of livestock insurance to protect them from the devastating consequences of unexpected storms, and all kinds of potential risks.

Livestock Insurance Protects Your Livelihood

Livestock insurance provides protection for farmers or ranchers who rely on animals to earn a living. It helps you recoup your losses in the face of a variety of disasters. Livestock insurance varies among insurance companies; you can choose a broader policy that covers specified perils and excludes others, or you might want full-mortality coverage for high-value animals like racehorses, registered livestock or show animals. Full mortality policies pay upon the death of the insured animal if the death is due to a legitimate cause, including illness. Full mortality policy premiums are determined by the value of the insured animal.

A statement of substantiated value and a veterinarian statement of health is required in addition to an application prior to covering livestock.

Standard livestock insurance typically covers specified named perils, unless specifically excluded. You need to know exactly what your policy covers so you can add endorsements or adjust your policy to meet your needs. Some of the typical covered perils are:

  • Smoke, fire, lightning, windstorm, flood or hail
  • Electrocution
  • Drowning
  • Attack by dogs or wild animals
  • Accidental shooting
  • Collision with vehicles or falling objects
  • Vandalism
  • Collapse of a structure, including buildings, culverts or bridges
  • Sinkhole collapse
  • Riot or civil commotion

Livestock theft can be covered under a specific endorsement. You can also add an endorsement that covers animals for death due to hypothermia and disease.

Specialize coverage is also available for hog confinement operations and poultry farms.

Other Coverage for Your Farm or Ranch

Farmers and ranchers will need other types of insurance as well, depending on the type of farm or ranch they have. There are several basic types of farm insurance that most will need, in addition to specialized policies for certain types of operations.

  • Property insurance, to protect the farmhouse, outbuildings, equipment and supplies if they are damaged by fire, or other covered perils. Flood Insurance can be purchased under a separate policy.
  • Machinery Breakdown, to protect against sudden and accidental breakdown of mechanical systems and boilers.
  • Liability insurance, to protect you from claims that you have injured another person or damaged another person’s property.
  • Crop insurance, to protect a particular crop or cover any losses due to crop failure or in some cases market failure. The USDA Risk Management Agency offers a range of crop insurance programs through private companies.

Farmers and ranchers also need workers’ compensation insurance if they have employees who work on the farm. In addition, if you offer u-pick crops, farm tours, a petting zoo or some other type of tourism open to the public, you need to consider specialty insurance policies for these types of operations.

Could you sustain a devastating loss of animals or crops and still recover? One storm could wipe out your herd, and your livelihood. Do you have all of the necessary coverage in place to help you rebuild in the face of a disaster? From small farms to large operations, we will work closely with you to assess your needs and make sure you have the right coverage.

NOTICE: This blog and website are made available by the publisher for educational and informational purposes only and is subject to change. It is not to be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.