Ranching is a lifestyle, not a pastime. Taking care of livestock, maintaining large pastures, operating heavy machinery, and managing staff are all part of the daily activities of many ranch owners throughout the U.S. With the responsibility of caring for the land and the animals on it comes some risk. Weather, diseases, and market prices for livestock can make or break your future.
The good news is that there is some security you can find with the right ranch insurance policy.; Ranch insurance is similar to farm insurance, but has special provisions to cover a large farm owner who breeds livestock.
What Is Ranch Insurance?
A ranch is a large farm that breeds animals like cattle, sheep, or horses. Normally, when insurance companies offer ranch insurance, it is defined as a farm policy that also provides additional risk protections for livestock, such as animal mortality insurance.
A ranch insurance policy will also cover home and belongings, other ranch structures, ranch operations equipment and more. It will also provide protection for the liability risks you face in this line of work.
Normally, you can choose a blanket policy, a scheduled policy or some combination of these coverages. The structure of your ranch insurance policy is contingent upon the type of ranch and property you own and the losses you want to insure against.
ü Blanket Property: This covers ranch dwelling, personal property, other ranch structures, ranch personal property, machinery, equipment and livestock up to certain predetermined limits. You do not have to list individual items.
ü Scheduled Property: This insurance protects the items you list on the policy. Can include ranch equipment, such as irrigation systems or specified personal property, such as high value jewelry. Some insurers may include livestock, otherwise you might have to but an animal mortality policy.
Equine and Livestock Protections
As a rancher, your main asset may be your livestock. Especially if you're running a breeding operation, it's a good idea to make sure you have your investment covered so that you don't suffer major financial losses due to an unexpected tragedy. Animal mortality insurance will help you protect your horses, cattle, bison, sheep, pigs, or other livestock that help you make a living.
Many times, ranch insurance property coverage will include some protections against the death of livestock, including cattle, horses, sheep, and pigs. These may cover accidental deaths by multiple causes, such as weather events and death while transporting animals. To cover death by sickness and disease, you will probably need to add a specialized animal mortality policy. These can normally be underwritten to cover a herd or high value animals on an individual basis.
Liability Coverage with Ranch Insurance
Nothing can put your ranch's future at risk like a liability lawsuit. That's why it is imperative that you carry strong ranchers liability insurance.
A general liability policy protects you in two main areas:
ü Bodily injury: This covers you or your ranch operations, if you are responsible for accidental bodily injury to a non-employee. It also provides for medical payments and legal claims.
ü Third party property damage: This insurance protects you if you or your ranch operations damage property that is not owned by you.
Liability policies allow you to add optional coverages as well. Some of these include risks like hunting and fishing liability or rented and leased land liabilities.
An umbrella liability policy can be another great option for ranch owners. This covers you above the limits of a general liability policy and can also protect you in areas not covered by general liability policies.
Barn Insurance and Other Outbuildings
Ranches utilize other buildings in addition to a the main dwelling, such as barns, storage sheds, garages, and workshops. Ranch insurance policies can provide coverage for all the buildings on your property for weather damage, such as windstorms and hail, as well as vandalism, theft, fire and other hazards.
The coverage you purchase should match the value of the buildings you have on the property. You may need to get an appraisal or other method of determining the value of the buildings before you purchase insurance for them.
Other Policies to Consider
As a rancher and a business owner, it's a good idea to protect your business and source of livelihood from major financial loss. Many ranch insurance packages cover the property side of the ranch business, but do not provide for the business loss provisions in a business owners policy or BOP. Normally these can be added as an endorsement to your ranch insurance policy. The key coverages you may be interested in include:
ü Business income or loss: Covers your lost revenue and operating costs if a business interruption is caused by a covered incident
ü Commercial vehicle: Protects your trucks, vans, and specialized vehicles used for business purposes
ü Workers Compensation: Covers your employees if they get sick, injured or die as a result of your ranch operations; legal requirements to carry this policy vary, so ask your agent about the law in your state
ü Professional liability or errors and omissions insurance: Protects you if you unintentionally cause financial harm to someone as you are carrying out your business or professional duties. You would need to consider this coverage if you are advising others on breeding, or providing another service that exposes others to financial damage if you make an unintentional error.