Farm Machinery Insurance Coverage & Average Premiums

Your farm uses various types of machinery and equipment to back its operations. You might have a whole host of different equipment on your land, from sprayers and planters to boilers and wagons. These all play a critical role in keeping up your farm’s operations, whether you’re a farmer who raises livestock to butcher, grows crops, or offers some variety of agritourism activities. Suffice to say, your farm equipment is critical to your operations, which is why you need farm machinery insurance.

Farm machinery can look like a range of different tools. Depending on the usage of your farm tools, your coverage needs may vary. Moreover, the overall value of your equipment will play a significant role in its overall cost. Hitchings Insurance covers most of the farm machinery on a blanket; however, some individual implements, such as combines, may require specifically scheduled coverage that is included with an overall farm package policy.

Farm combines, tools, and other machinery are expensive as is, and they’ll certainly cost you a pretty penny to repair or replace without insurance. Here is an overview of farm machinery and equipment insurance coverage as well as some insight into how these unique policies are priced.

Farm Machinery Insurance: Blanket vs Scheduled

Like with any insurance policy, your farm equipment insurance coverage or farm machinery insurance will vary in price depending on several factors. You may not be paying the same amount as the next farmer for their machinery and tools. It all depends on the overall value for which you have your items insured. Note that while it isn’t mandatory for most machinery and equipment on your farm to carry insurance, you may want to discuss the benefits of this coverage with an agent. Keep in mind, if you are renting the equipment, the owner may require coverage. Here are examples of insurable farm machinery and equipment:

• Combines
• Plows
• Drills
• Cultipackers
• Applicators
• Planters
• Harrows
• Balers
• Wagons
• Carts
• Excavators
• Sprayers
• Mowers
• Seed tenders

Machinery on your farm may be insured in two different ways, or in a combination of the two: blanket coverage or scheduled coverage. Here are the differences between them:

Blanket Coverage

Blanket coverage is typically the most viable option for most of the machinery on your farm. Most insurers will recommend blanket coverage, which covers all items that are deemed insurable property. These items do not need to be listed on any kind of schedule to have coverage. All the items that are insurable under the blanket have up until a maximum amount of coverage, regardless of how many claims are made over the policy period.

Scheduled Coverage

Scheduled coverage, on the other hand, covers items that are listed in a “schedule” on your policy or on file with your insurer. Anything that is not listed on this schedule will not be covered. In some cases, an insurer may recommend a combination of blanket and scheduled coverage. Specific items, such as combines, would have scheduled coverage and a reduced amount of blanket coverage for unscheduled items. This may be a more reasonable option for some farmers, as it reduces costs while ensuring that all your valuable farm equipment and machinery has insurance.

Overall Value

When you apply for a policy, you will need to provide an accurate assessment of all the equipment, tools, and machinery you will want to have insured. You may wish to include the important details of each item, including the following:

• Age
• Make
• Model
• Serial number
• Coverage limit (based on the value of the piece)

Remember that the limit is the total amount that your insurance carrier will pay out if that item is damaged beyond repair or lost entirely. Your losses may be paid out either on a replacement cost basis (the better but more expensive coverage option, which subtracts the depreciation of the object) or actual cash value (which pays out for the item based on its current depreciated value.)

Farm Machinery Insurance Pricing Examples

There is a lot of variety when it comes to farm machinery. There are so many important items. It can be difficult to gauge an average for pricing farm machinery insurance on a schedule basis simply because there are so many different variables. See below for some specific examples of pricing for farm equipment insurance coverage.

• For $1,500,000 blanket coverage for farm machinery, you might be paying $4,600 per year in premium. In this example, per every $1,000 of coverage, you pay $3.06.
• For additional, optional coverages like loss of use, you might expect an additional $250/year on top of your existing farm machinery insurance premiums.

It’s worth noting that the cost to insure your farm machinery and equipment is negligible next to the overall cost it would take to fully replace your farm machinery and equipment if something disastrous were to occur, such as a barn fire, lightning strike, gas explosion, etc. These items are invaluable to your farm’s operations, so it’s always better to have protection than not.