Farm Equipment Breakdown Coverage
The Value of Farm Equipment Breakdown Coverage
Whether they raise livestock or keep their produce fresh for transport and sale, most farmers have leased or purchased equipment integral to their farming operations. When farm equipment breaks down, operations stall—or come to a halt entirely.
Farms and other agricultural operations need special insurance coverage to pay for unexpected breakdowns. Yet, too many farms lack equipment breakdown protection as the standard farm policy does not automatically include this coverage. Let’s explore what farm equipment breakdown is and what its importance is for farmers.
Why is equipment breakdown coverage important?
Since so many pieces of equipment are essential in day-to-day farm operations, an equipment breakdown could severely compromise a farmer’s livelihood. Equipment breakdown coverage is not always easy to understand. The coverage is designed to compensate for the exclusions of electrical, mechanical, and pressure systems breakdown in most farm policies. From hobby farms to commercial and agricultural, all farms are compromised when equipment breaks down or there is a system failure.
What does equipment breakdown cover?
Equipment breakdown protection covers the perils of mechanical, electrical, and pressure systems breakdowns, which are restricted/excluded perils in the underlying form. Equipment breakdown coverage usually covers the farm dwelling and its contents along with barns, stables, and other structures.
Here are just a few items equipment breakdown coverage can help protect and maintain:
- Automatic waterers
- Circuit breaker panels
- Computerized feeding systems
- Heating and cooling systems
- Milking parlors and collection equipment
- Refrigeration compressors
- Silo unloaders
- Well pumps
What are some things that a farmer may protect under this coverage?
- A cooler used to store vaccines for animals cannot continue to run forever. The start relay for the compressor can burn out, not allowing the compressor to run. The contents of the cooler would be spoiled from the lack of refrigeration. The cost to repair the refrigeration unit and the vaccines that spoil are common items that could be covered.
- Corn stalks can get inside an irrigation canal and be sucked into a pump. This may lead to clogged pumps, which can result in the burn out of the pump motor. Repairs to the irrigation system would typically be covered.
- In troubled times, a farm can lose power for days. The farm can use a backup generator for an emergency, but after a few days the generator may experience an electrical short or other breakdowns, damaging the drive engine. The cost to replace the unit and any spoilage that resulted is typically covered.
Why is it important for a farmer to discuss equipment breakdown coverage with their insurance agent?
The unique exposures of electrical, mechanical and pressure systems breakdown have led to coverage gaps. The equipment breakdown endorsement addresses the peril of equipment breakdown to the Farm property policy. By adding the equipment breakdown enhancement endorsement, loss caused by, resulting from, or consisting of, an electrical or electronic breakdown, mechanical breakdown, or pressure systems breakdown will be covered.