Starting a small hobby farm or family farm, with the main intention of selling just enough to remain solvent, is the dream of many people. If you have managed to find land and begin fulfilling that dream, you will want to make sure that you do nothing that puts it at risk. No matter how good the land is or how skilled you are, there will be bad years and bad luck. You can mitigate some of these risks with the rights types of insurance. This guide can help you determine which types of coverage you need.

Equipment coverage

Unless you are doing everything by hand in an attempt to recreate a much simpler time, chances are you have some equipment. Whether it's a single tractor or a barn filled with machinery, a breakdown can be a major financial blow. Equipment coverage is for all the machinery used on the farm. Some policies include office equipment, such as printers and copiers, along with non-mechanical equipment like fences, under equipment coverage. Other providers will issue separate policies for office equipment and farm equipment.

Commercial auto insurance

Vehicles that are taken off the farm are not covered underneath an equipment policy. This includes delivery trucks and work vehicles that are also used as personal vehicles. You will need to either purchase a separate commercial policy for these vehicles, or add a commercial use rider to your personal auto insurance policy.

Livestock insurance

This policy covers certain types of loss. Generally, wild animal attacks, poaching, natural disasters, and death caused during transport are covered, while death by natural causes and disease are not covered. The policy may also cover damages to animal enclosures, if they aren't already covered in an equipment policy.

Crop insurance

Crop insurance can keep the farm afloat in a bad year. This policy generally protects against crop loss from natural disasters and diseases that wipe out a crop. Some policies even offer coverage in the event of a major price drop, which can help you make up lost income during a bad market year.

Liability coverage

Every farmer should have some form of liability coverage. These policies protect you in the event that you are sued, such as if one of your farm products results in illness. It will also cover you against any accidents that occur on your property if you open your farm to the public.

For more help, contact a farm insurance agent such as Western Reserve Group.

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