Growers Insurance: Essential Coverage for Agricultural SuccessAmerica’s growers take on substantial risk to keep food on our tables and wine in our glasses. However, hard work isn’t always enough to guarantee agricultural success. To guard against unexpected losses that could threaten your business, you need the right growers insurance. Before you suffer a loss, ask yourself whether you have the coverage you need to protect your business.
Commercial Property Insurance
Your agricultural business likely has multiple structures, such as warehouses, offices, and tasting rooms. Damage to those buildings could be expensive to repair, and you may face disruption to your operations in the meantime. Therefore, having commercial property insurance in place is critical. In addition to a standard commercial property insurance policy, you may want to secure separate policies to cover earthquake and flood damage.
Personal Property Insurance
Many growers live onsite. If your home is located on your land, make sure you have sufficient personal property insurance for your dwelling as well as for your personal belongings.
Crop Insurance
Crop insurance is important for growers, as the success of your business depends on a good harvest. A bad year may threaten your business; several bad years may destroy it.
Multiple peril crop insurance (MPCI) provides insurance coverage for lower-than-expected yields due to natural events, such as weather, drought, fire, flood, disease, or insects. Although it is private insurance companies that sell MPCI, the federal government supports and regulates coverage.
Growers can also purchase crop-hail insurance and crop revenue insurance to supplement their MPCI coverage. Crop-hail insurance provides additional coverage for hail-related losses, while crop revenue insurance provides coverage for lost revenue due to low yields or price fluctuations.
Business Interruption Insurance
After a disaster, lost revenue may be just as harmful as the property damage itself. Business interruption insurance provides coverage for lost revenue after a covered loss.
Auto Insurance
In addition to complying with state requirements for auto insurance, it’s important to secure coverage that protects your business. If one of your employees is found to be at fault in a crash, the resulting litigation could be extremely costly, especially with the recent increase in social inflation and nuclear verdicts. High liability limits with excess or umbrella liability coverage can provide additional protection.
Also consider whether you need hired and non-owned auto insurance coverage. If your employees use vehicles for work purposes that your company does not own, hired and non-owned coverage will provide liability protection for your company in the case it is named in a lawsuit.
Equipment Breakdown Insurance
Standard commercial property insurance does not provide coverage for equipment malfunction. For agricultural businesses, this may result in a massive insurance gap. If the equipment you rely on breaks down unexpectedly, your operations could grind to a halt. There’s even a risk of crop loss. You need to fix your equipment as quickly as possible – equipment breakdown insurance helps you do this while staying within your budget.
General Liability Insurance
Commercial general liability insurance is essential coverage for businesses in many industries, including growers. It provides coverage for many third-party claims, such as those involving bodily injury or property damage as well as claims involving libel, slander, copyright infringement, and other personal and advertising injury claims. In addition to protecting your company in the event of a lawsuit, commercial general liability insurance typically includes medical payments coverage on a no-fault basis.
Pollution Insurance
Pollution-related claims may be extremely costly, and commercial property insurance typically excludes these claims. Pollution insurance (also called environmental insurance) provides important protection for growers and may cover various costs, including property damage, bodily injury, cleanup, and legal defense.
Workers’ Compensation
Agricultural workers are vulnerable to accidents, heat-related illness, chemical exposure, and other serious work-related injuries. In addition to meeting state requirements for workers’ compensation, growers can protect their businesses by securing coverage that protects workers while controlling costs.
Employment Practices Liability Insurance
Lawsuits from employees, former employees, and job seekers may threaten your bottom line. Employment practices liability insurance provides coverage for many employment-related claims, including discrimination, harassment, and wrongful termination.
Does Your Agricultural Business Have Sufficient Coverage?
An agricultural insurance checklist is a good place to start, but each business is unique and insurance terms vary. You may need additional coverage types or endorsements. Some questions to ask include:
- Does your inventory have coverage against damage, leakage, and contamination?
- If you also have a tasting room, do you have sufficient liquor liability insurance?
- Do you have cyber exposures that warrant cyber insurance?
To determine whether your coverage is sufficient, it’s best to work with an insurance agent who specializes in your industry. Don’t wait until you’re facing natural disaster damage or a lawsuit to think about whether your coverage is sufficient – request a review of your coverage as soon as possible.
Heffernan Insurance Brokers offers insurance programs designed for wine growers. Learn more.
