Commercial Agribusiness Insurance

Owning and running a farm is no easy task, but that doesn't mean insuring it has to be hard. A simple farm and ranch insurance policy likely isn't enough if you have a whole agribusiness. Fortunately, there's a type of coverage known as commercial agribusiness insurance.

An independent insurance agent will get to know all about you, your farm, and your goals to help you decide on the right kind of coverage. They'll shop among the best agriculture insurance carriers to find the perfect blend of protection and price for you, your farm, and your business. But first, it helps to understand what you're looking for.

What Qualifies as Agribusiness?

Simply put, agribusiness entails commercial activities related to farming. Thus, a farm that raises crops and/or livestock doesn’t necessarily need agribusiness insurance, which is designed to cover the commercial activities of the farm rather than the farm itself (which is what farm insurance is for).

For example, a pumpkin patch farm probably doesn’t need agribusiness insurance if it only raises pumpkins and sells them to local markets. If, however, the pumpkin patch farm provides tractor rides, a farm stand, pumpkin picking, etc., then agribusiness insurance becomes necessary.

A farm is not only a business, but it's also a home in many cases, which means it requires special protection that combines home insurance and business insurance into one policy with add-ons like equipment coverage and crop coverage.

What Does Commercial Agribusiness Insurance Cover?

Your commercial agribusiness insurance policy starts with a broad range of coverages that include common necessities for farm owners. From your pole barns to your crops and livestock to your equipment and tractors, this policy has got you covered. There are also additional coverages that can be added to your policy to cater more specifically to your needs.

Commercial agribusiness insurance covers:

Farmhouses: This covers your home on the property as a homeowners insurance policy would. But with agriculture insurance it's grouped into one policy.
Livestock: This covers the replacement of your livestock due to injury or death, such as if your cattle got attacked by a coyote or caught in a barbed wire fence.
Crops: This covers your crops against bad weather that may destroy your produce. Some policies even have coverage for pests.
Equipment and machinery: This covers much of your tractors, combines, threshers, and so on.
Barns and other structures: This covers your barns, equipment buildings, pole barns, and more.

Additional coverages worth considering:

Fire: If this coverage is included, it depends on your carrier, your access to a fire department, and how easily your fire can be put out. Talk to your independent insurance agent about the specifics of your farm to ensure you get the fire coverage you need.
Fencing: Since fencing ranges in price and quality, it's normally an endorsement that gets added to the policy so you can be sure you have enough coverage for your fenced-in farm.
Windmill coverage: This covers the value of any windmills on your property destroyed or damaged by a covered event.
Silo coverage: This covers your grain and corn storage from damage by a covered event.
Bee coverage: This is not protection from bee stings; it's protection for your bees. If you operate a honey-producing beekeeping farm, protecting the queens and their workers is a must.

If you're in need of additional coverage, talk to your independent insurance agent. They'll be able to recommend the specific coverage you might want to add to your commercial agribusiness insurance policy.

Business Insurance Coverage for Agribusinesses

Many types of coverage needed for agribusinesses can be found under the umbrella of business insurance. Your commercial agribusiness insurance policy likely will include many of the following:

Loss of business income coverage: This protects you if there’s a business interruption by replacing lost income and providing continued operating expenses coverage to keep your farm running.
Workers compensation coverage: This protects your workers and employees from sickness, injury, or worse as the result of a job-related accident. Every state has different guidelines and requirements, so talk to your independent insurance agent about the requirements in your area.
Commercial vehicle coverage: This protects the big rigs, transport trucks, and trailers that you have to run your business.
Commercial umbrella coverage: This extends the liability coverage beyond your agriculture insurance policy's limits. If you have a lot of visitors on your farm or your products end up in a large number of houses or restaurants, it's wise to increase your liability coverage with an umbrella policy.

Your independent insurance agent can recommend exactly which types of business insurance are right for your commercial agribusiness policy.

When Is Agribusiness Insurance Required?

Typically, commercial agribusiness insurance isn't mandatory, but depending on what you're producing and selling, you may have different coverage requirements. Your distributors and even consumers may require proof of insurance before working with you or purchasing your crop or livestock. This is to protect their interests as well as yours.

Also, if you have any farmhands or farm employees, your state will most likely require some form of workers' compensation coverage. Further, having agriculture insurance can provide you with critical liability coverage in case of a lawsuit. Without this coverage, you might have to pay for lawsuit expenses out of your own pocket, which could potentially lead to hefty financial losses or even bankruptcy.

How Much Does Commercial Agribusiness Insurance Cost?

Agribusiness insurance rates can be costly, but it depends on your farm's specifics. Having a good idea of the following before your conversation with an independent insurance agent can help get you a more accurate estimate.

These factors impact your agribusiness insurance premiums:

Number of acres: How much land you have impacts your insurance's cost. The more you have to insure, the higher the premium you'll likely pay.
Barns and other structures: The number, size, and quality of barns and other structures factor into your cost.
Production: What you grow, harvest, produce, and sell also affects premiums. For example, it costs more to insure a tobacco farm than a wheat farm. The type of item and the more inherent risk before, during, and after product production also affect pricing.
Farmhouse: The size, quality, and features of your home on your agribusiness also impact your policy's pricing.
Equipment and machinery: Both motorized and unmotorized property like tractors, threshers, and other equipment needs insuring. The replacement cost of some of those pieces could be high, impacting rates.
Workers: The farmhands and workers you hire to run your farm impact rates because liability risk increases with employees, and you'll also need to add a workers' compensation policy.

Review the specifics of your agribusiness together with your independent insurance agent. Based on the information you provide, they'll be able to find several quotes for you.

The Benefits of Working with an Independent Insurance Agent

Independent insurance agents have access to multiple insurance companies, ultimately finding you the best coverage, accessibility, and competitive pricing while working entirely for you. As your farm grows and your needs change, they'll be there to help you adjust your coverage to make sure you're properly protected without overpaying. And down the road, they'll be able to help file claims for you if necessary.

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