Agribusiness Insurance FAQ

• At the minimum, agribusinesses need general liability insurance.
• If they have employees they will need workers compensation in most states.
• If they have vehicles registered to the business, or use vehicles for the business purposes, they will also need commercial auto.
• There are also other specialty coverages and endorsements that might be needed based on their operations.

Agribusiness operations are not eligible for most businessowners programs, but commercial coverages can be conveniently combined under a commercial package policy.

Larger agribusiness risks should consider writing their insurance coverage under an agricultural output policy due to its flexibility and additional coverages.

Equipment Breakdown Protection can be provided through an agricultural output policy or may be written separately. The coverage is extremely important because of the extensive use of machinery to control temperatures, monitor feed, milking and many more operations.

Utility services direct damage coverage is an important optional coverage that should be considered because the agribusiness risk depends on an uninterrupted source of power for its continuing operations.

Types Of Property Coverages:

• Building
• Business Personal Property
• Personal Property of Others
• Improvements and Betterments

Animal mortality, transportation and electronic data processing are three vital inland marine coverage needs. Livestock operations have significant exposures to all three because of the potential for significant loss when animals are kept in a single building. Transporting live animals can be very hazardous especially on narrow rural roads.

Electronic Data Processing coverage is also extremely important because all agribusiness operations are becoming dependent on it for communication and also for efficiently managing all aspects of the processing.

Types Of Inland Marine Coverages:

• Accounts Receivable Coverage
• Bailee Customers
• Difference in Conditions (DIC) Coverage
• Electronic Data Processing Equipment Coverage
• Mobile Agricultural Machinery and Equipment Coverage Form Signs
• Transportation Coverage
• Valuable Papers and Records Coverage

CROP AND LIVESTOCK COVERAGES

Loss of crops or livestock can financially ruin an agribusiness operation. Therefore, special coverages are available specifically to cover these unusual loss exposures. The market is limited because of the unique nature of the exposures, and the specialized knowledge necessary to underwrite and price the risk and to adjust any claims.

Crop hail, multiple peril crop insurance and revenue insurance are all government plans sold and serviced through local agents and contracted insurance carriers.

Types Of Crop And Livestock Coverages:

• Computer and Funds Transfer Fraud Coverage
• Employee Theft Coverage
• Forgery or Alteration Coverage
• Inside The Premises-Theft of Money and Securities Coverage
• Inside The Premises-Robbery or Safe Burglary of Other Property Coverage
• Money Orders and Counterfeit Money Coverage
• Outside The Premises Coverage

Agribusiness operations having contracts to supply products to government entities are required to provide a contract-performance of service or supply bond. Other bonds may be required, depending on the actual operations performed or services provided.

Types Of Surety Coverages:

• Contract-Performance of Service or Supply Bonds
• License and Permit Bonds

Tainted products are the biggest general liability concern for most agribusiness, but with the surge of agritourism, premises injury concerns are increasing. Some large operations have a railroad spur on their premises, which adds an exposure that can only be covered with a railroad protective policy.

Types Of Liability Coverages:

• Claims-Made to Occurrence Coverage
• Commercial General Liability (CGL) Coverage
• Employee Benefits Liability Coverage
• Employment-Related Practices Coverage
• Product Recall or Product Withdrawal Expense Coverage
• Product Contamination Coverage
• Railroad Protective Liability Coverage
• Special Events Liability Coverage

The agribusiness automobile exposure varies dramatically based on the particular type of operation. Those with livestock will have considerable more exposure than those that are grain. It is important to evaluate the drivers for experience and training in the particular transport because transporting live animals can be extremely difficult especially on rural narrow and winding roads.

Types Of Business Auto Coverages:

• Auto Medical Payments
• Business Auto Coverage
• Collision Coverage
• Comprehensive Coverage
• Garagekeepers Coverage
• Hired & Non-owned Auto Coverage (HNOA)
• Uninsured/Underinsured Motorists Coverage

Most employers are required by state statute to provide coverage through a workers compensation policy for on-the-job injuries sustained by their employees. However, some agricultural workers are exempt from coverage. It is important to add a voluntary compensation coverage endorsement to cover those workers in order to avoid a coverage gap. Farm workers have some of the highest rates of work-related injury, so coverage should be as broad as possible.

Types Of Workers Comp Coverages:

• Federal Employers Liability Act (FELA)
• Longshore and Harbor Workers Coverage
• Stop-Gap or Employers Liability Coverage
• Voluntary Compensation Coverage
• Workers Compensation and Employers Liability Coverage

Tainted food products can injure great numbers of people throughout a city, state, region or nation. Because the dollar impact of the damages can be catastrophic, additional excess or umbrella limits of insurance are needed. If coverage is written on a claims-made underlying policy, retroactive excess liability coverage should be considered.

Types Of Excess Liability Coverages:

• Excess Liability Coverage
• Retroactive Excess Liability Coverage
• Umbrella Coverage

Loss exposures to agribusiness operations are different, depending on the types of operations conducted, the nature of the customers, and the countries where the products are sold. The coverages provided by the following policies may be particularly helpful to certain customers.

Environmental impairment and pollution-related items are of particular concern with the increased emphasis of waste disposal and ground water contamination. Unmanned aerial vehicles (drones) are becoming a valuable tool for many agricultural risks. The uses continue to grow as the drones become more sophisticated and more accessories become available.

Types Of Specialty Coverages:

• American Expatriate Coverage
• Business Legal Expense Coverage
• Commercial Credit Coverage
• Cyber Liability Coverage
• Directors and Officers Liability Coverage
• Environmental Impairment Liability Coverage
• Export Credit Insurance Coverage
• Fiduciary Liability (Pension, Welfare and Employee Benefit Funds) Coverage
• International Insurance Coverage
• Patent Infringement Liability Coverage
• Risk Retention Group Liability Coverage
• Solar Energy System Coverage
• Tax Liability Coverage
• Tender Offer Defense Expenses Coverage
• Underground Storage Tank (UST) Liability Coverage
• Unmanned Aerial Vehicles (UAV) (Drones)
• Weather Coverage