Insurance for your farm has become more complex for reasons of changing farming patterns and changes in the levels of risk. Farms and farming location and enterprises are different and that is why you need to spend some time to look at the range of insurance cover options to suit your specific needs.

There are also some new insurance choices available and new levels of cover possible in order to protect you and your farming operations.

If you change your farming operations by adding a new enterprise, you need to let your insurance company know about any possible new risks to protect you and your new investment.It is obvious that your insurance needs will change as your business changes.

There may be buildings that have been built in the last couple of years that have not been added to your policy. The value of these buildings need to be kept up-to-date and you may also be farming extra or different land.

All these point to the need for care when completing your insurance renewal documents.

Take time and talk with your farm insurance adviser and make sure that you, your family and your farming enterprise are covered against all risks.

What are the essential insurance cover areas for farm insurance?

All farms need to have employers’ liability, public liability/personal liability, as well as protection for the farm property and livestock.

In addition to the more traditional insurance risks of fire, lightning, explosion, storm, electrocution and flood, farmers can insure their livestock for injury while in transit or if they stray from the insured’s property.

The storm damage cover proved particularly useful to some farmers earlier this year.

Transporting livestock by trailer is a related insurance issue, which should be kept under review.

Here, cover is available for livestock that are injured while moving from farmyard to an out-farm or going to the factory or mart. This is separate cover for loss or damage to livestock and should not be confused with liability cover.

Some policies can also provide cover against accidental injury arising in connection with the collapse of slats.

More expensive pedigree livestock can be insured on an individual basis against mortality arising in connection with injury or disease. Other mobile property, such as trailers and tools, which are vulnerable to theft, can be insured.

Cover on tools is usually restricted to theft from specified outbuildings, which have approved security standards.

In terms of insurance, it is important that any new farm buildings are included under the policy. A separate but related issue is that of under-insurance of outbuildings.

It is important that the sums selected are adequate for full reinstatement.

Provision should also be made on the policy to provide fire cover for agricultural produce, hay, straw, agricultural implements, tools and fire brigade charges.

Employers’ liability

This cover provides protection against legal liability for injury or disease caused to employees of the farm in the course of their farming duties.

By law, every farmer with fewer than three employees must complete a risk assessment document and comply with the farm safety code of practice.

Farmers with more than three employees must complete a safety statement. This regulation also applies to individuals working on a seasonal basis on the farm. Some insurance policies provide employers’ liability cover for all farm family members over the age of 14.

Likewise, family members returning to help out on the farm, at weekends or summer holidays, may be covered under the standard policy. You will need a full declaration of wages and the work activities on your farm.

Some activities can fall outside what is considered standard farming practice. These must be declared, to allow insurance companies to extend your cover accordingly. These activities may include building work, horse training or agricultural contracting.

Public liability/personal liability

Public liability insurance covers legal liability for injury, disease or property damage caused to a member of the public arising from your farming activities.

Personal liability covers liability that may attach to a farmer in a personal capacity. An example would be while partaking in a sport. Some policies, such as FBD’s public liability cover, provides personal liability cover for the farmer and all family members residing with the farmer.

Answers to your farm insurance questions

We got some insurance advice for farmers from FBD to deal with specific issues on the farm that are unusual and arise from time to time. These include farm walk insurance cover, animal theft cover, cover for family members working on the farm, storm insurance and issues around roaming animals.

Do I need additional insurance cover for farm walks on my farm?

Check with your insurance company on this issue. Some insurance policies include it as part of the standard farm package, while others may not. It is good practice to notify your insurance company if you are conducting a farm walk and bringing the public on to your farm. The insurance representative may have some useful and practical advice.

The standard public liability cover provided by FBD will protect the farmer for any legal liability which may attach to him arising from the use for or holding on his lands or farmyard for a group farm walk/demonstration. There is a standard limit of indemnity of €2.6m on any one incident.

There is a distinction between this and an open farm, which can be catered for by payment of an additional premium. Those holding farm walks/farm demonstration events usually adhere to good husbandry and are acutely aware of health and safety requirements.

These include secure parking of tractors and farm machinery, stock-proof penning and fencing, control of dogs and isolation/fencing off of water hazards, hay and straw stores.

Can I get insurance cover against animal theft?

FBD has launched a new policy to protect farmers against rustling. The insurance is available as part of FBD’s farm multi-peril policy livestock offering.

The policy aims to protect farmers for theft incidents, both in farm outbuildings while animals are housed and in the open while animals are grazing, including on out-farms or rented/leased lands. The protection is for the full herd.

Pricing of this new livestock cover extension can be available for a moderate additional premium. It is recommended that all farmers review access points to lands and farmyards to ensure all precautions are taken against theft.

In order to ensure that you are protected, farmers need to review livestock sums insured and assess the maximum herd value they may have in a period of insurance. Cover excludes theft of poultry and of pigs and is available for all new and existing farm policies.

This a valuable new cover option as the level of rustling has been increasing in recent years. There was a 165% increase in the number of cattle stolen in 2013 when compared with 2012. In 2013, 298 cattle were reported stolen.

Are there insurance changes following the storm damage in February of this year?

Under the FBD farm multi-peril policy, storm damage cover can be provided on suitable farm buildings, subject to survey. This can be extended to include storm damage to agricultural produce while stored and to livestock in sheds or confined in an enclosed yard. There is an excess of €350 for all storm claims.

There is no change to existing criteria as a result of the recent storms. Insurers would encourage farmers to review the condition of older buildings in order to make them more secure.

Are extended family members insured when working on the farm?

Family members, for insurance purposes, are defined as the policy holder and his/her spouse and their direct sons and daughters. FBD will provide employers’ liability cover in respect of all family members who are over 14 years. Likewise, family members who return to help out at weekends or holidays are covered under the standard policy.

Relations who are outside this definition, such as cousins, grandchildren and in-laws etc., are considered, for insurance purposes, to be casual labourers.

The insured’s own parents, brothers, sisters and cousins would not be deemed to be members of his/her family for the purposes of the insurance.

Insurance issues that arise with direct family members are catered for under the farm’s employers’ liability insurance cover. Those non-family relatives working the farm are covered under the employers’ liability insurance of the farm’s policy as they are usually considered as unwaged casual workers.

There is a distinction between unwaged casual family members and those working permanently for whom an annual declaration of wages is required.

How are roaming animals treated for insurance purposes?

Roaming farm animals are covered under the Animals Act (1985) and the owner is responsible for accidents or damage caused by animals where they are roaming off the farm. It is also the duty of the farmer to ensure that livestock are safely herded on the roads.

Some farmers will have what is called livestock on foot or livestock in transit insurance cover for their animals as an extra to their policy if they are regularly moving animals on the road. This add-on insurance provides cover should the animal be killed as a result of a road accident.

If roaming animals cause damage to someone else’s property, then you will be covered for the costs associated with that under your public liability cover, which is normally included with your farm cover.

It is the farmer’s responsibility to make sure that all fencing and gateways to public roadways are secure and that livestock cannot escape onto public roadways. FBD said that public liability insurance will not cover the farmer for the loss of his own livestock and, therefore, it is advisable that the farmer arranges the necessary separate cover for the animals themselves.

I don’t have a full-time employee, why do I need Employers’ Liability cover?

Employers’ liability is a vital cover. Every farmer will have somebody working on their farm at some time. Even if you only employ someone on the farm once during the year, accidents can and will happen. Employer liability insurance cover protects you, as the employer, if it happens to you.

Why should I have personal accident insurance?

Personal accident insurance cover will provide you with an income in the event of you not being able to work on your farm as a result of an accident. This income can offset costs associated with bringing someone in to help run your business while you are unable to work.

What is under-insurance?

Under-insurance occurs where the sums insured on your property are less than the reinstatement or replacement cost of the property as new. Where a property is under-insured, the value of any claim on this property will be reduced by whatever proportion is represented by the level of under-insurance.

For example, where the current rebuilding cost of a livestock shed is €100,000 and the existing shed has been insured for €70,000, the extent of under-insurance is €30,000 or 30% of the full rebuilding cost. The value of any claim in relation to this shed will be therefore reduced by 30%.

If a contractor machine breaks down on my farm, under what circumstances should I accept liability for the cost of the repairs?

In all situations, once a farmer holds an FBD public liability insurance policy, his legal liability to third parties and third party property (including contractors) is covered. The best advice is to take all reasonable precautions, notably rolling of lands before silage-making with identification of obvious hazards.