You might not want to think about it, but in the event the precision ag product you invested in gets damaged or ruined, would it be covered under your insurance?
Don’t assume your equipment is covered on a broad or blanket insurance policy because it probably isn’t.
Plan a visit with your insurance agent to be sure, but it’s likely that you need to schedule your precision equipment on your policy using what is called a special form to be sure you’re protected against all the perils you’ve considered and some you probably haven’t even thought of. If your agency doesn’t offer special coverage on farm personal property, it can be scheduled on an inland marine policy to get more extensive all-encompassing coverage.
“Don’t just assume that because you have insurance on your property, whether on your farm policy or your personal policy, that you’re going to have coverage on all your precision stuff,” Michael Vallery, of Vallery & Dorn Insurance, said. “Have a discussion with your insurance agent and ask, ‘How should I cover this on my policy to make sure that I’m not going to be disappointed when something bad happens?’”
According to Vallery, farmers using precision ag equipment and technologies should be considering their insurance and revisiting this issue annually. Farmers will often purchase new equipment without thinking of transferring the addition onto their policy because they are so excited about the new opportunities for information or efficiencies.
A best practice is to keep a list of equipment, its make and model, and corresponding serial numbers to share with your agent during that annual meeting. Each of these needs to be listed on a special form to guarantee protection.
“Having your equipment and serial numbers listed is going to protect farmers from just about everything except the common exclusions on an insurance policy. Those are ordinance of law, earthquake, flood, power failure, neglect, war, nuclear hazard, or intentional act. A broad form has things it covers and things it doesn’t, but a special form gives you everything except those,” Vallery said.
Keep in mind, as technologies continue to change, any equipment that lives in a combine or tractor and cannot be moved to another combine or tractor is included in that combine or tractor’s policy. The equipment that needs a special form is anything that can be moved from one combine to another or from the tractor to the sprayer and vice versa. As an example, if you’re using one monitor for both your combine at harvest and your tractor during planting, that monitor needs its own coverage.
Precision equipment is a big investment and one big peril that isn’t covered is power surges. Vallery mentions having someone welding on the combine and having that power ruin an entire precision ag technology system for the farmer who owns the combine.
Power surges on movable equipment are one of the biggest perils that are not covered by a broad policy. Power surges can cause massive damage to a precision ag system.
“Too many times, guys just take for granted that they have insurance on their equipment and they’re not really paying enough attention to calling their agent and getting these changes when they need to be made,” Vallery said.
By: Michael Vallery, Vallery & Dorn Insurance
Michael is a sixth-generation farmer that sells farm, home, auto, life and crop insurance in South Central Ohio at Vallery & Dorn Insurance. He graduated from Madison Plains high school in 1987 and Clark State in 1989 and went back to the farm to continue farming with his father. He took over his uncle’s insurance agency in 2001 and started selling multi-peril crop insurance. He currently farms with his father and three sons near Sedalia, Ohio.