Hobby Farm vs Full Time Farming Insurance
Hobby Farm vs Full Time Farming Insurance
Whether farming is your occupation or just a hobby, you will probably agree that there's nothing more peaceful than working your own land. At Robinson Strategic Advisors, we have been insuring farms of all sizes across the New Jersey, Pennsylvania and New York for over 23 years. Whether you are thinking about selling produce from your garden at the local farmers market or making your farm your full-time job, it is important to make sure that you understand farm insurance coverage. I would like to share 5 things that you might not already know about farm insurance policies.
Your Standard Homeowners Policy Covers Some Farming Activities
Many treat their large garden or small farm as a hobby and have no intention of making money. If you fall into this category, it’s possible that your standard homeowner’s insurance policy will cover some of these farming activities. Keep in mind that homeowner’s insurance policies generally exclude things like farm equipment and farm outbuildings. You can set up an analysis with Robinson Strategic Advisors to find out precisely what coverage your homeowners policy provides.
If You’re Farming for a Profit, You May Need a Different Type of Policy
Hobby farming for a profit requires different coverage than your basic homeowner’s policy. If you begin selling farmed goods at a local farmers market, for example, you’ll want to consider a hobby farm policy, we have policies that fit the bill for hobby farms.
There are a few guidelines that must be followed for a farm to be considered a hobby farm. Some of these guidelines include:
Coverage is limited to a single farm location
· There must be no employees
· Limited to a certain maximum of acres.
· Total annual farm receipts are limited.
· There is minimum coverage of on the main dwelling.
Make sure to contact James for even more details about our country estates or hobby farm insurance and its requirements.
If Farming is Your Full-Time Occupation, You Will Need a Farm Owner’s Policy
If you want to take your hobby even further and start farming as a full-time occupation, you’ll need farm owner’s insurance coverage. A basic farm owner’s policy generally includes property coverage, liability coverage, and more.
To better protect your livelihood, this basic coverage should be modified with endorsements based on your farm's unique needs. James will be able to help you determine what types of endorsements will best fit your farm's needs.
Farm Insurance Coverage is Not Standard
A common misconception about farm insurance is that a policy is one big bundle of predetermined coverages. In reality, farm insurance policies have so many different aspects that there is no standard policy. Each farming operation is unique and a policy should be custom built for the needs of the farmer.
Some Coverage has Limitations on Commercial Structures
Homeowner policies generally limit coverage on commercial structures, while hobby farming insurance policies, like country estates insurance, and farm owner's policies do not. For example, if a building is being used in a manner that exceeds the special limits set forth in the policy conditions (usually in the form of gross annual revenue generated), the building is then considered a commercial building and may not be covered under a homeowner’s policy. The same concept applies to all of the owner’s activities.
You Need Special Coverage for Livestock
Livestock insurance is similar to crop insurance and is partially funded by the United States Department of Agriculture. Depending on the types of animals you have on your farm, you will likely require special coverage for livestock. A few options to consider include individual coverage, as well as blanket coverage.
Individual Coverage (Scheduled): Scheduling animals individually may be the right option if you have higher-valued animals that you want to cover up to a specific dollar amount.
Blanket Coverage (Unscheduled): With a blanket policy, all of your farm property (livestock, equipment, structures, etc.) is insured in one lump sum amount. When using blanket insurance, make sure to insure to adequate values, as being under-insured could result in a lower claim payment than you need or expect.
Keep in mind that the maximum amount payable per head is dependent upon your choice of insurance (i.e. individual or blanket), so be sure to talk to James or one of our agents, about which option will work best for your operation.
Robinson Strategic Advisors has relied on word of mouth for many years. We pride ourselves in serving farmers across the New Jersey, Pennsylvania, and New York. We have relied on word of mouth in the tightknit agricultural community. One of the greatest compliments of our farm insurance policyholders can give is telling another farmer about our coverage.
Your farm isn’t just another piece of property — it’s your life’s work.
Ensure your farm assets are well protected with a homeowner’s, hobby farm, or farm insurance policy.
Founded by James Robinson, to protect farmers, Robinson Strategic Advisors has been serving the unique needs of agricultural families throughout the region.
We understand that each farm is unique and one of our agents can craft a custom policy just for you.