No matter the business you’re in, you need some form of insurance coverage. Of course, certain high-risk industries require special forms of coverage. In the agricultural world, which is particularly prone to acts of God (drought, famine, tornadoes, etc.), businesses often require specialized insurance products to protect their assets. While most farmers are familiar with farmers insurance, there are other types of insurance coverage to consider in the agricultural sector. For instance, agribusiness insurance protects a wide variety of businesses, from daily bottling plants to grain elevator operators.
According to a survey conducted in 2016 by the Insurance Information Institute, only 79% of homeowners understood what their insurance policies covered. In the agribusiness sector, business owners don’t have that luxury. Keep reading to learn more about agribusiness insurance, which can play a crucial role in protecting your business’s assets.
Understanding Agribusiness Insurance
In the city, many people still imagine small family farms when they think of agriculture — if they think about agriculture at all. In reality, the agricultural industry is much more complex. In the past few decades, many small farms have been replaced by massive, industrial-scale operations. To provide food to a growing world, a variety of industries work together to produce vast quantities of dairy products, produce, meats, and grains. And just like farmers require farmers insurance, these agricultural businesses require insurance coverage of their own. Agribusiness insurance is a type of commercial insurance that protects farm supply stores, grain dealers, milling elevators, pesticide and fertilizer distributors, and even food processing plants. Agribusiness insurance can help these businesses cover the modern tools required to compete in the agricultural sector.
What Is Covered By Agribusiness Insurance?
Agribusiness insurance includes a variety of coverage options, most often property insurance and business income insurance. Together, this coverage will help a business protect physical assets as well as the revenue lost from downtime and other interruptions. This protection can be combined with other insurance products, such as commercial auto insurance and workers compensation, to further protect a business.
In addition, agribusiness companies may invest in optional, value-added agribusiness coverage. These comprehensive plans can provide protection for:
- Pollutant cleanup costs
- Costs incurred by newly passed laws or ordinances
- Newly purchased buildings
- Newly purchased computer and/or mobile equipment
- Accounts receivable protection
- Property in transit protection
Why Invest In Agribusiness Insurance?
When you acquire agribusiness insurance coverage, the benefits can extend beyond the insurance product itself. For instance, when Farmers Union Insurance works with a new agribusiness company, our underwriters and loss control specialists work closely with the client. Together, we gain insight into their unique operational environment, which can include on-site inspections, safety presentations, and loss trend analysis. By providing services like these, we can often help identify risks before they become catastrophes, leading to expensive downtime and costly claims.
In this way, both parties benefit from agribusiness coverage. That’s why businesses such as mushroom growers, auction barns, potato chip manufacturers, and seed dealers all invest in our agribusiness insurance plans.
There is no doubt that insurance policies have been very effective and important to farmers all over the world. However, as the agriculture industry has grown more complex, so too have the insurance products it depends on. To succeed in the modern agricultural industry, you need all of the same tools and operational sophistication as a technology company. And to protect your investment, you need commercial insurance products designed specifically for agricultural companies like yours.