Key Takeaways
- Consider Crop insurance to manage risks from adverse weather affecting harvests
- Property insurance protects buildings, vehicles and equipment from damage
- Liability coverage is important given risks of equipment use and customer interactions
- Equipment insurance covers repairs if expensive machinery is damaged
- Business interruption coverage provides funds if operations are temporarily suspended
Introduction
Businesses in agriculture, forestry, fishing and hunting industries face unique risks that traditional commercial insurance may not fully address. These operations depend on weather, environmental conditions, and natural resources that can impact their livelihoods. Proper insurance tailored to their needs can help manage financial risks outside of their control and allow them to focus on running their businesses.
Crop Insurance
Crop insurance provides crucial risk management for farmers and agriculture businesses. It protects against unexpected financial losses from natural disasters and adverse weather conditions beyond their control.
Crop insurance helps agricultural operations plan for risks outside of their control. It supports long-term viability and sustainability through protection from losses due to natural disasters or weather issues.
Crop insurance also provides essential tools to safeguard farmer’s livelihoods against unpredictable external forces like weather. Having this coverage allows them to continue serving customers and communities even after experiencing crop losses.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on industry research, the estimated average annual pricing for crop insurance for businesses in the Agriculture, Forestry, Fishing and Hunting industry (NAICS Code 11) is around 2-5% of the total insured value of crops. Factors like crop type, location, loss history will impact the final price. For a average farm with $500,000 in insured crops, the estimated annual premium would be $10,000-$25,000.
Estimated Pricing: $10,000-$25,000
Property Insurance
Property insurance provides critical protection for businesses in agriculture, forestry, fishing and hunting against risks to their physical assets like buildings, equipment, livestock and inventory that are essential for continuing operations after losses due to perils like fire, storms, theft or accidents. It protects different assets commonly involved for these business types such as farms, forestry equipment, fishing boats, crops and stored commodities. On average, property insurance pricing is estimated to be around $3.50 per $100 of insured value based on industry averages and loss histories for this sector. Property insurance ensures these businesses have financial resources to repair or replace damaged property and continue operating after a loss occurs.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on industry averages, the estimated average annual pricing for property insurance for businesses in the agriculture, forestry, fishing and hunting industry with NAICS Code 11 would be around $3.50 per $100 of insured value. This pricing takes into account the higher risks involved for properties and equipment related to agriculture, livestock, fishing vessels, and forestry given exposure to weather and natural disasters. The pricing was derived from insurance rate filings and loss histories for businesses in this industry sector.
Estimated Pricing: $3.50 per $100 of insured value
Liability Insurance
Liability insurance is an important coverage for businesses in the agriculture, forestry, fishing and hunting industries due to the risks inherent in their operations. It can help protect these businesses from costly lawsuits in the event of injuries, property damage or other liabilities. Some key benefits of liability insurance for these industries include protecting from employee injury claims, lawsuits over food contamination, damage from equipment or controlled burns, and hunting accidents on private property. Common types of claims faced by these businesses that liability insurance can cover include injuries to employees and others, property damage, and issues related to food contamination or hunting incidents. Estimated average annual premiums for general liability policies in these industries is around $1,500.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on average pricing data from major insurance providers for the Agriculture, Forestry, Fishing and Hunting industry, the estimated average annual premium for general liability insurance would be around $1,500. This price is calculated based on industry averages considering factors like business size, annual revenues, number of employees, types of operations and assessed risk levels.
Estimated Pricing: $1,500
Equipment Insurance
Equipment is vital for businesses in agriculture, forestry, fishing, and hunting. Without proper protection, damage or loss of valuable assets like tractors, boats, harvesters and trucks could negatively impact operations and finances. Equipment insurance can help protect these businesses by providing coverage for repairs, replacements, liability, and business interruption due to equipment damage or theft. Most policies will cover accidents, breakdowns, disasters and theft with an average annual premium of $1,500 for farms and operations in these industries.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on typical quotes from major insurance providers for equipment insurance coverage of farming equipment and machinery, the estimated average annual premium would be around $1,500. This price is derived from considering common policy coverages and limits for farms and businesses in NAICS 11 industries, average values and numbers of insured equipment/machinery, and factoring in some risk adjustment based on location and operations details.
Estimated Pricing: $1,500
Business Interruption Insurance
Business interruption insurance provides financial protection for businesses in agriculture, forestry, fishing and hunting industries (NAICS code 11) against losses from interruptions to their operations due to insured incidents like weather events, accidents, and regulatory actions. It covers ongoing expenses and costs needed for repairs and cleanup to help these businesses resume operations after an insurable loss or disaster. Pricing is estimated between $1.50-$2.00 per $100 of insured value for 6-12 months of coverage based on typical industry loss ratios and insurance rates. Top benefits include protecting revenue during shutdowns and covering extra costs to get back up and running. Common use cases involve crop/livestock damage or loss from weather, disease outbreaks damaging equipment or harvests, and fishing/hunting bans.
| Category | List |
|---|---|
| Benefits |
|
| Use Cases |
|
Based on average premiums for businesses in NAICS code 11 industries, business interruption insurance would price around $1.50 – $2.00 per $100 of insured value. This range assumes no specialized risks and coverage is for 6-12 months of business interruption. The pricing is calculated based on historical loss ratios for this industry and standard insurance company rates and loadings.
Estimated Pricing: $1.50 – $2.00/100 insured value
Conclusion
Choosing the right combination of crop, property, liability, equipment and business interruption insurance policies gives agriculture, forestry, fishing and hunting operations crucial risk management tools. This allows them to withstand losses and continue serving their communities through unpredictable challenges. Consultation with an experienced agent can help identify the optimal insurance strategy for each business.