To best protect their operations against many perils, farmers and ranchers in Texas need adequate agricultural and farm insurance.
What can be confusing to many farmers is how farm insurance agencies determine the rates they will pay for their policies.
Farm and agricultural insurance are two separate types of coverage that protect different assets.
Acknowledging this detail, farm insurance agents quite these four factors that are considered when farm insurance premiums are calculated.
- The Nature of the Business - Where farm insurance is concerned, different operations requires different insurance coverage. Farm insurance agencies recognize a variety of agricultural operations when calculating risk, and premiums, including produce and dairy farms, livestock ranches, agro-tourism operations, crop farms, and others. Insurance for each of these different operations includes a variety of appropriate coverage including homes, agricultural buildings, agricultural equipment, and more. Additionally, farms that grow crops, whether for consumption by animals raised on the farm or for sale, require crop insurance on top of any standard farm insurance policy.
- The Size of the Business - Naturally, larger-scale businesses with more buildings, equipment, animals, and other assets require a higher farm insurance premium than smaller ones, with fewer assets.
- The Number of Livestock - For policies that include livestock coverage, farm insurance agencies must account for the number of each type of animal being covered to calculate the overall insurance policy rate.
- The Amount and Type of Coverage Desired - As with all other insurance policies, farm insurance agents will discuss with farm owners the types of coverage they need, from standard property insurance and commercial liability coverage to commercial vehicle insurance, crop insurance, natural disaster policies, environmental pollution protection, and other named peril insurance, and the coverage amounts and limits that are most appropriate for them.
While insurance rates for agricultural operations are determined by factoring in details in these four categories, coming up with a policy that is as protective as it should be while also being affordable to the farmer can be challenging.
Skilled farm insurance agents who understand the agricultural business in Texas will work with farmers and ranchers to get to know their operation as much as possible, then help them decide on the coverage that makes the most sense for them.
In Summary
There are many layers to an effective and protective agricultural and farm insurance policy.
Farmers and ranchers running agricultural businesses of any type and at any scale should work closely with an experienced farm insurance agency that will take the time to work in their best interest to develop the best insurance policy.