What is a Farm Package Policy?
A Farm Pack provides a broad range of insurance protection for farmers. It consists of fifteen main sections (depending on the insurer) to help protect your Farming business. The package may be tailored to suit your needs and budget.
The basics of a Farm Package Insurance policy cover are:
- Home Property– covers the Buildings and Contents of the Domestic/Residential part of the farm
- Farm Property– covers the “Business” assets of the farm such as Sheds, Stables, Barns and Fencing against risks such as Fire, Storm, Accidental Damage, Business Interruption and other perils
- Public and Products Liability – covers bodily injury or property damage you cause to a third party
- Private & Farm Motor Vehicles – some packages include this to cover accidents and theft
- Personal Accident and Sickness– compensation if you are unable to work the farm due to injury or long term illness.
- Land Transit – Fire, flood, collision and overturning of your goods moving around Australia
- Pleasure Craft– whether a tinny on your own Dam or a boat on the local river, it can be included
- Machinery Breakdown– repairs to mechanical equipment following sudden damage
- Computer/Electronic Equipment Breakdown– repairs to electronic equipment following sudden breakdown.
- Theft – covers theft and burglary including damage caused by a trespasser on the farm
- Working Dogs– Death, theft or putting down following veterinarian’s advice
- Frozen Embryos/Semen– Accidental damage to frozen embryos/semen stored at the situation
- Tax Audit – Covers unexpected additional professional fees if the ATO suddenly audit your business
- General Property – Accidental damage for farm property insured whilst in Australia
Insurers commitment to Regional Australia
It is true that many insurers are no longer willing to offer these types of policies any more to regional Australia, but there still are many others that will including QBE, CGU, Allianz and Argis. They recognise that the economy of agricultural based communities is linked with the fortunes of the seasons. They have to take a long term view in the way in which they conduct business because they too in some years will do better than others.
Things to remember in Farm Package Insurance Policies
Watch out and discuss with your Broker some of the following issues:
- “Average clause” which may only pay a proportion of your claim if under-insured
- Full Reinstatement/Replacement conditions – sometimes called “New for Old” rather than Market value
- Stock is different to Contents though some packages combine it. Make sure you apportion correctly
- Never under-estimate the value of Business Interruption cover. It can be the difference between survival for your business or oblivion when you cannot generate income from your lost assets
- Get a regular valuation of your Buildings insured for its rebuilding costs and factor in escalation for future costs including if a widespread catastrophe where labour and supplies can be in short supply
Read more on Under Insurance here
Who can help?
An insurance broker’s role is to act as your representative and work in your interests, seeking the best cover at the best price for you with their skill, market knowledge and experience. Call a good one.
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