3 Important Things To Know About Farm Insurance

Many people dream of owning farmland someplace out west such as Claremore, Oklahoma. Where you can live a simple life, waking early, tending the animals, and working the land. While you plot out your American Dream, don’t forget that farming will require special insurance to protect your investment and your dream. Farm insurance can be tricky because each farm is unique and requires individualized policies. The size of your farm and the purpose of your farm will help shape your policy, in addition to the types of crops and animals you wish to raise.

There Are Different Types Of Insurance Needed For Hobbies, Hustles, And Full-Time Income Farms

There are many types of farmers such as dairy farmers or soybean farmers, but for insurance coverage, we’re going to look at the purpose of the farm. There are three main farming purposes and each has its own unique insurance requirements. When choosing farm insurance, ask yourself what your ultimate vision for your farm is. Do you want to run a small farm for fun, or are you looking to make it a full-time gig?

1. Hobby Farm – Some people want to own a large garden or small farm purely as a hobby with no intention of making a profit on their endeavor. They want to grow their own food to eat at their own table. It’s possible that a standard homeowner’s policy will be enough coverage for this, however, some do exclude farm equipment or farm buildings, so check with your agent. Structures under homeowner’s insurance might be restricted to certain uses and once they are deemed as being used for a commercial purpose you will no longer be covered.
2. Hustle Farm – If it’s not your full-time job but you do want to make a little money with your farm, that’s called a “side hustle.” It can go by many names, but the result is the same. If you’re making any income on your farm it’s considered a type of business. If you’ll be selling goods to a local farmer’s market, for example, you’ll need “hobby farm” insurance. Your farm must be less than 500 acres and have no employees to qualify.
3. Full-Time Income Farm – If you’ve entered the big leagues then you’ll need a “farm owners” policy. This will include property, liability, and more. You’ll take a basic policy and modify it to your specific farm needs. If your farm is larger than 500 acres, has employees, or is considered your full-time income, then you’ll need this type of policy. If you own farm animals, then you’ll need livestock insurance. Livestock insurance is similar to crop insurance but it covers living animals and is partially funded by the United States Department of Agriculture. You can insure individual animals if they are of high-value or you can get blanket insurance for all of the animals at once. If you’re doing blanket insurance make sure to value the animals appropriately so you don’t end up being under-insured.