There are more than 56,000 farms in Indiana covering more than 15 million acres, according to the Indiana State Department of Agriculture publication, Indiana Agriculture. Agriculture is a huge facet of Indiana’s economy and Indiana Farm Bureau Insurance wants to help farmers get the protection they need. Planting and harvesting crops at the proper time is crucial to farmers as it can affect the growth and yield of the crops. Getting the timing precisely right can determine much of the crop’s yield potential. Many variables go into developing this plan, including ensuring that farming equipment is ready and available at these critical times. Having farm machinery and equipment insured properly is one way to safeguard that it is available to go to the field when the time is right.
What is considered farm equipment?
Motorized equipment used in farming operations such as tractors, combines, sprayers and loaders are all considered farm equipment by Indiana Farm Bureau Insurance. Also included are equipment and apparatus attached to these items, such as wagons, planters, plows, cultivators and balers. In short, any machinery directly used to grow crops or raise livestock can be considered farm machinery. All this equipment can be covered by a Rural Guardian Farm Policy.
The amount of farm insurance an individual needs will vary from farm to farm, depending on the size and type of farming operation. Determining your insurance needs depends on two facets: farm property and liability. Farm property covers the physical items that are used to conduct farming operations. These items include farm structures, equipment and machinery, livestock, crops and farm vehicles. The farm structures can be insured on either a replacement cost or an actual cash value basis. The age and characteristics of the equipment, as well as personal preference, will impact the value at which these should be insured. Farm liability provides protection for your farm if others are injured, or property is damaged as a result of your farming operations.
How much farm machinery insurance do I need?
Farm machinery is one of the largest investments in farming operations and having proper insurance to cover this investment is crucial. Many factors can affect farm machinery value such as make, model, age, hours of use and the condition of the equipment. Indiana Farm Bureau Insurance recommends you work with a local equipment dealer to determine the value of individual pieces.
We understand that the amount and value of farm machinery can fluctuate year to year as old equipment is sold and replaced, while new machinery is acquired for the farm. This is why Indiana Farm Bureau Insurance provides Farm Personal Property Blanket coverage. This coverage is designed to help protect all your farm machinery and equipment, as well as other farm personal property such as livestock, feed, grain, tools and office equipment under one total limit. The Farm Personal Property Blanket provides a cushion to the value of all farm personal property values. We strongly recommend that you do an annual review of the farm’s personal property inventory to ensure everything is accounted for and properly valued.
You also have the option of scheduling coverage for farm machinery on the Rural Guardian Farm Policy. The benefit of this is that a specific value can be selected per individual piece of equipment. Any equipment scheduled this way will appear on the policy’s Declarations page with its value.
What’s the difference between replacement cost coverage and actual cash value coverage?
Replacement cost coverage pays to repair or replace property at today’s prices. Actual cash value takes into account the depreciation of the item. Farm machinery is only eligible for actual cash value coverage.
Are there endorsements that may be beneficial?
Farm machinery coverage protects farm machinery and equipment against losses and damage caused by fire, severe weather, theft and vandalism. Additional coverage can be added with a variety of endorsements.
For example, the Farm Machinery Endorsement extends the perils of the policy to include direct physical loss, including situations such as collision, overturn or rock ingestion.
The base Rural Guardian Farm Policy does not cover the rental cost of equipment after an accident or claim. We recommend that farmers get an Extra Expense Endorsement added to their policy. The Extra Expense Endorsement allows a farmer to establish funds to cover normal farming operations in the event of a covered loss. For example, if a combine catches fire and can’t be used to harvest crops, the Extra Expense Endorsement could be used to cover the cost to rent a combine to complete harvest.
The Rural Guardian Select Endorsement offers new coverages for emerging trends in the agriculture industry. You may also round out your insurance coverage by adding the Farm Electronic Equipment Endorsement and the Multi-Terrain Vehicle Endorsement.
Will my policy cover machinery that is leased or loaned?
Sometimes it makes more sense to borrow or lease a piece of machinery that is essential for business operations. The Rural Guardian Farm Policy does provide coverage for borrowed farm equipment, but only while the equipment is in the care, custody or control of the farmer. Also, the equipment must be added to your policy for the time it is being used, so be sure to contact your insurance agent for more information.
Are there risk management practices that can help lower my premiums or prevent losses?
Though Indiana Farm Bureau Insurance’s Rural Guardian Farm Policy will most likely cover repairs and replacements, losing a vital piece of equipment in today’s modern farming operations can cost you both time and money. It’s best to minimize any losses ahead of time.
These simple risk management steps can help avoid accidents and losses:
- Conduct regular maintenance according to the manufacturer’s recommendations.
- Ensure all headlights, warning lights and flashers are working properly.
- Always have a slow-moving vehicle sign installed, clean and visible.
- Avoid machinery fires by regularly cleaning debris and crop residue from machinery.
- Don’t leave keys in tractors or other equipment.
Also, follow these safety tips to keep your farm, loved ones and yourself safe.
How do technological advancements in machinery affect my insurance coverage?
Many Hoosier farms have been passed down from generation to generation. When our great-grandparents first started the farm, they had simple machinery. Today’s farm machinery is a tool full of advanced technology and costs much more to repair or replace than those old tractors did. The use of GPS, autosteer, planters, sprayers and yield monitors has become essential to the operation of today’s modern farm.
Because of the high value of the electronic equipment, Indiana Farm Bureau Insurance has created an endorsement to provide specialized coverage. The Farm Electronic Endorsement provides coverage specifically for replacing electronic equipment due to direct physical loss. This endorsement provides the option to replace the damaged or lost equipment and provides coverage to pay for the installation and activation of the new electronic equipment, which can cost thousands of dollars.
How do I file a claim in the event of damage or loss?
We know that farming requires long hours and the unexpected can happen at any time, because of this Indiana Farm Bureau Insurance provides farmers with the ability to report a claim 24 hours a day, 7 days a week online or by calling 1-800-723-3276.
How do I choose a deductible for my policy?
The Rural Guardian Farm Policy allows for a separate deductible for each part of the farm insurance policy, meaning you may have a different deductible level for the home, farm structures and farm property. Indiana Farm Bureau Insurance offers a wide range of deductible options for insuring farm equipment and machinery. Higher deductibles can reduce the amount of premium, but the insured retains more of the risk in paying for accidents and claims.
An important part of any insurance policy is to make certain the coverage amount is enough to cover any claim, and this is no different for farm insurance. We strongly recommend that farmers conduct an inventory of all farm machinery, equipment, tools and other items included in the Farm Personal Property Blanket annually. This inventory helps confirm all pieces of equipment are included and can help verify the total coverage amount is adequate.
Farm equipment and machinery are vital to the successful operation of the farm. Work with your Indiana Farm Bureau Insurance agent to ensure that all machinery and equipment is valued properly. You should also discuss what endorsements are needed for your particular circumstances. Protecting your farm equipment is a key step to helping keep any farm operation running smoothly.
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Frequently asked questions:
Here are some frequently asked questions about farm insurance and insuring farm machinery. If you have additional questions, reach out to a local Indiana Farm Bureau Insurance agent today to get those questions answered!
What factors affect the cost of farm machinery insurance in Indiana?
The total amount of coverage and the deductible amount have the largest impact on farm machinery insurance premiums.
Can I get insurance for used or older farm equipment?
Indiana Farm Bureau Insurance provides coverage for all farm equipment and machinery used in farming operations, no matter the age of the equipment. However, we recommend that you schedule any antique pieces.
Are there any discounts available for bundling farm insurance policies?
The Rural Guardian Farm Policy bundles dwelling, farm property and farm liability policies together into one policy. There are also several discounts available such as the Paperless Discount, Paid in Full Discount, and Loyalty Discount. Please speak with an Indiana Farm Bureau Insurance agent to discuss any specific discounts that may apply to your policy.
What is the difference between scheduled and blanket equipment coverage?
Any scheduled farm equipment or machinery will be individually listed on the policy Declarations along with the amount of coverage. It provides the same coverage and benefits as Personal Property Blanket equipment coverage, but some lienholders may require that specific items be scheduled with a specific coverage amount.
How can I ensure that my farm machinery is valued correctly for insurance purposes?
One of the best ways to accurately value your farm machinery is to work with a local farm equipment dealer. Knowing this helps ensure that you have the right amount of coverage to suit your needs. An advantage of covering your equipment with the Farm Personal Property Blanket is that it provides a cushion by insuring numerous pieces of equipment under one limit rather than a single value.
Does farm machinery insurance cover breakdowns due to wear and tear?
The Rural Guardian Farm Policy provides coverage for named perils fire and smoke, severe weather, explosion, riot vandalism and theft, but does not cover normal wear and tear from regular farm use. The Farm Machinery Endorsement can expand coverage to direct physical loss, such as collision and overturn.
What documentation will I need to provide when filing a claim for my farm equipment?
Farming is not a 9-to-5 job and Indiana Farm Bureau Insurance knows that the unexpected can happen at any time, so farmers can report a claim 24 hours a day and 7 days a week online or by calling 1-800-723-3276.
Information that will be helpful when reporting a claim is:
- Policy number
- Date and location of loss
- Description of loss, damaged property and injuries
- Steps taken to prevent further damage
- Names involved
- Home, work and cell phone numbers
*Subject to underwriting criteria, approval, and eligibility requirements. Exclusions and limitations may apply.
**Inside Story and any references therein are for educational purposes only and does not constitute legal or tax advice. Testimonials do not guarantee future or similar results or outcomes, and may not consider your specific circumstances, goals, or objectives.