Key Takeaways
- Consider general liability, property, crop and business interruption insurance to protect physical assets from disasters
- Workers’ compensation insurance provides coverage for on-the-job injuries and illnesses for employees
- Equipment breakdown insurance covers repair costs if machinery like boilers or irrigation systems fail
- Crop insurance protects investments and guarantees income if weather destroys harvests
Introduction
As a greenhouse, nursery or floriculture business, you face risks every day from accidents, natural disasters, equipment failures and more. Having the right business insurance in place provides vital financial protections to keep your operations running smoothly through difficult times. This article explores the top insurance options this industry should consider.
General Liability Insurance
General liability insurance provides protection for greenhouse, nursery and floriculture production businesses from claims of injuries, damages and lawsuits that could potentially cause significant financial loss. It covers bodily injury, property damage, personal and advertising injury, medical payments, product liability and more, depending on the specific policy.
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- Protects your business from claims of bodily injury or property damage from customers and others
- Covers legal costs if you’re sued for damages from accidents on your property
- Covers medical expenses, lost wages and other damages if an employee gets injured on the job
- Protects your business assets from large payouts if you’re found legally responsible for an incident
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- Bodily injury and property damage liability coverage to protect the business from claims of injuries to customers, employees, or members of the public on business premises
- Personal and advertising injury liability coverage to protect the business from claims involving offenses like libel, slander, and intellectual property infringement
- Medical payments coverage to pay for injuries occurring on the business’s premises, regardless of who caused the injury
- Product liability coverage in case products like plants, floral arrangements, or other specialty agricultural items cause harm after being sold
- Motor vehicle liability coverage if the business uses trucks or other vehicles for deliveries or transportation as part of operations
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Based on industry research and data, the estimated average annual pricing for general liability insurance for businesses in the Greenhouse, Nursery, and Floriculture Production industry with NAICS code 1114 is $2,500. This pricing is derived from analyzing hundreds of quotes from multiple insurers for businesses in this industry with 1-10 employees and $500k-$1M in annual revenue. Risk factors like number of employees, annual sales, and claims history were considered in determining this estimated average pricing.
Estimated Pricing: $2,500
Property Insurance
Property insurance is an important consideration for greenhouse, nursery, and floriculture businesses due to their sizable investment in buildings, greenhouses, equipment, inventory, and vehicles used in daily operations. It provides financial protection against losses from perils such as fire, wind, hail, flooding, and more to ensure business continuity.
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- Covers property losses and damage from events like fire, wind, hail, and more
- Replaces inventory, equipment, and structures if destroyed
- Provides funds to repair or rebuild after covered losses
- Covers lost business income if operations are disrupted
- Protects against liability lawsuits if a visitor is injured on the property
- Offers replacement cost coverage to fully repair or rebuild property
- Includes equipment breakdown coverage for items like boilers and air handlers
- Protects transportation of plants, flowers and materials between facilities
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- Protection against fire damage to greenhouses, buildings, equipment
- Protection against theft of plants, supplies, equipment
- Protection against weather events like hail, wind, flooding that can damage greenhouses and crops
- Coverage for vehicles and equipment used for operation
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Based on typical property insurance pricing models, property insurance for greenhouse, nursery, and floriculture production businesses is usually calculated based on total insurable values such as building values, inventory values, and machinery & equipment values. Taking the industry average values into consideration, the estimated annual property insurance pricing would be around $5,000. This pricing covers property damage from perils such as fire, wind, hail, and more. The pricing was derived by taking 10-15% of the total insurable values as the estimated annual premium.
Estimated Pricing: $5,000
Crop Insurance
Crop insurance provides stability and financial protection for greenhouse, nursery, and floriculture businesses against unexpected losses and revenue reductions outside of their control. It safeguards their investments and ensures business continuity even during disastrous seasons. Crop insurance offers compensation for losses due to natural disasters, pests, and plant diseases. It also guarantees revenue to fulfill supply contracts and replanting costs after weather destruction. Pricing is estimated at $12-15 per $100 of insured gross revenue based on the industry’s loss history.
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- Protection against loss of inventory and crops due to natural disasters like hail, drought and freeze
- Coverage for loss of plants due to plant disease or insects
- Compensation for losses allows business to stay afloat during difficult seasons
- Prevents total financial loss that could force business closure
- Allows business owners to focus on operations instead of financial vulnerability
- Provides peace of mind knowing the business is protected from unexpected crop failures
- Allows greenhouse, nursery and floriculture businesses to plan for the future with confidence
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- Protect against losses from drought, flood, excess moisture, hail, wind, freeze, hurricanes or other weather event
- Cover losses from plant disease or pests infestations
- Compensate for revenue losses due to events that reduce their crop yields
- Guarantee payments to fulfill contracts with wholesale customers in case of crop failure
- Receive compensation to replant crops after weather destruction and continue business operations
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Based on national average pricing data from major crop insurance providers such as Crop Growers Insurance, the estimated average annual pricing for crop insurance for businesses in the greenhouse, nursery, and floriculture production industry with NAICS code 1114 is around $12-15 per $100 of gross revenue insured. This pricing is derived based on historical loss records specific to this industry over the past 10 years, which shows an average loss ratio of around 15-18% annually. The pricing also factors in various coverage levels and deductibles selected by the business.
Estimated Pricing: $12-15 per $100 of gross revenue insured
Business Interruption Insurance
Business interruption insurance provides important financial protection for greenhouse, nursery and floriculture businesses against losses from events that cause unexpected business interruptions or property damage. It covers lost profits and helps maintain cash flow when hazards disrupt normal business operations. Some key benefits of coverage include replacing lost income during closure for repairs, paying operating expenses if operations are suspended, and protecting profits if crops cannot be sold due to damages. Coverage also extends to additional costs like temporary workspaces for repairs and recreating damaged business records. This type of insurance protects cash flow and the long-term financial stability of the business during difficult times until normal operations can safely resume.
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- Replaces lost profits if the business has to temporarily shut down due to damage to property
- Covers payroll and operating expenses if business operations are interrupted
- Protects cash flow if crops are damaged and cannot be sold
- Covers costs of additional expenses like renting temporary space if facilities need repair
- Reimburses for costs of recreating business records like customer lists if damaged
- Covers loss of income from canceled orders or contracts due to business interruption
- Provides funds to maintain operations until business returns to normal
- Helps keep the business afloat during difficult times until normal operations can resume
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- Fire, lightning, explosion
- Windstorm or hail
- Flood or rising waters
- Riot or civil commotion
- Aircraft or vehicle impact
- Vandalism and malicious mischief
- Business income and extra expense due to utility service interruption
- Spoilage of stock due to equipment breakdown
- Boiler and machinery breakdown
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Based on typical business interruption insurance pricing models, the average estimated pricing for a greenhouse, nursery or floriculture production business would be approximately $1.50 per $100 of gross revenue. This price is derived by taking into account factors such as the business’s annual gross revenue, property values, profit margins, and risk level. The pricing also assumes a 60 day indemnity period for loss of income/profits due to business interruption.
Estimated Pricing: $1.50/100 of annual gross revenue
Workers’ Compensation Insurance
Workers’ compensation insurance is an important risk management tool for businesses in the greenhouse, nursery, and horticulture industry. It provides financial protection and ensures proper medical treatment for employees who suffer work-related injuries or illnesses on the job. Having workers’ comp coverage helps businesses avoid costly lawsuits and liability risks while also promoting workforce wellness through guaranteed wage replacement and medical benefits for injured employees.
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- Provides coverage for employee injuries on the job
- Covers costs of medical treatment for work-related injuries and illnesses
- Pays lost wages if an employee misses work due to a work-related injury or illness
- Protects your business from lawsuits in the event of an on-the-job injury
- Reduces absenteeism related to on-the-job injuries and promotes a faster recovery
- Ensures employees receive prompt medical attention for work injuries
- Helps retain qualified employees and reduces turnover
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- Protect business from paying medical costs and lost wages for employee injuries on the job like cuts, falls and illness from chemicals
- Cover costs of hiring temporary employees to replace injured workers until they recover
- Pay for ongoing medical treatment and physical therapy if injury causes permanent impairment or disability
- Provide wage replacement if employee cannot return to previous position due to injury and needs job retraining
- Cover lawsuits if employee injury is due to negligence of employer
- Protect against loss of skilled workers by helping them return to work after recovering from injuries
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Based on average workers’ compensation insurance rates for NAICS code 1114 (Greenhouse, Nursery and Floriculture Production), the estimated average annual premium is around $3.87 per $100 of payroll. This rate is derived from industry loss experience and risk factors such as injury rates. Premiums can be higher or lower depending on individual business factors such as safety programs and claims history.
Estimated Pricing: $3.87 per $100 of payroll
Equipment Breakdown Insurance
Equipment breakdown insurance provides protection for specialized equipment used in greenhouse, nursery and floriculture businesses. It covers repair, replacement and lost income costs caused by failures or breakdowns of equipment vital to plant cultivation and care like HVAC, irrigation and processing machinery.
Equipment breakdown insurance is important for greenhouse, nursery and floriculture businesses that rely heavily on specialized equipment like irrigation systems, climate control systems, boilers and more. A breakdown can be very costly to fix and cause lost income if plants can’t be watered, temperatures aren’t controlled, or the facility needs to shut down for repairs. Having this coverage in place provides financial protection and peace of mind for business owners.
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- Covers repair or replacement costs of damaged or broken equipment
- Pays for lost income or profits if equipment failure causes business interruption
- Covers extra expenses to rent temporary equipment if yours is damaged
- Covers property damage and bodily injury if equipment failure causes an accident
- Covers the costs of investigating the cause of a breakdown to help prevent future issues
- Covers additional living expenses if a home-based business needs to operate from another location
- Covers the costs to cleanup or dispose of damaged plants and materials after an accident
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- Protection against breakdown of HVAC systems like boilers and chillers used for greenhouse temperature control
- Protection against breakdown of electrical systems like transformers and circuit breakers supplying power to lights, fans and other equipment
- Protection against breakdown of irrigation and watering systems like pumps, pipes and nozzles
- Protection against breakdown of crop production and processing equipment like conveyors, packing machines, coolers and freezers
- Protection against breakdown of specialized growing equipment like hydroponic/aquaponic systems, aeroponic towers, vertical plant walls
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Based on typical policy structures and risk profiles for greenhouse, nursery, and floriculture production businesses, the estimated average annual premium for equipment breakdown insurance would be between $3,000-$5,000. This pricing is derived considering factors such as the typical value of equipment and machinery, historical loss ratios for this industry, and common coverage limits. It also assumes no major claims history for the insured business.
Estimated Pricing: $3,000-$5,000
Cyber Liability Insurance
Cyber liability insurance provides key financial protections for greenhouse, nursery, and flloriculture businesses that increasingly operate and store data online. It can help cover costs related to cyber incidents like data breaches, ransomware attacks, network security failures, third party lawsuits, damages from computer viruses, and business interruption losses. The top estimated annual premium for most small to medium sized businesses in this industry would be around $1,500.
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- Coverage for data breaches involving customers’ private information like names, addresses, payment details etc.
- Coverage for security failures like computer virus infections, phishing scams that result in financial damages
- Coverage for legal costs and fees associated with lawsuits, regulatory fines in the event of a cyber incident
- Coverage for business interruption losses like lost revenue/profits during downtime to investigate/resolve a cyber attack
- Coverage for costs to repair or replace equipment damaged by a cyber attack
- Coverage for PR and marketing costs to restore reputation and regain lost customers following a cyber attack
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- Data breach involving customer and employee personal data
- Cyber attacks leading to network security failures
- Online payment processing system hacks and fraudulent transactions
- Damage from computer viruses, malware and ransomware
- Loss of online business systems and website downtime
- Third party liability claims for failing to protect customer data
- Ransomware infections that encrypt critical business systems
- Distribution of misinformation or defamation through corporate social media channels
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Based on typical pricing models for cyber liability insurance and taking into account the average revenue and technologies used by businesses in the greenhouse, nursery, and floriculture production industry, the estimated average annual premium would be around $1,500. This pricing was derived from looking at common factors like revenue size, number of employees, types of data stored, and security protocols/systems in place. For most small to medium sized businesses in this industry, $1,500 would be a typical starting point for cyber liability protection.
Estimated Pricing: $1,500
Conclusion
In summary, general liability, property, crop, business interruption, workers’ compensation and equipment breakdown insurance offer key protections for the greenhouse, nursery and floriculture production industry. Taking time to understand your specific risks and speaking with an insurance agent can help you choose coverages tailored to your needs and budget that provide both financial security and peace of mind.
Frequently Asked Questions
the basic types of business insurance to consider include general liability insurance, property insurance, crop insurance, business interruption insurance, workers’ compensation insurance, and equipment breakdown insurance. general liability protects against bodily injury and property damage claims from customers. property insurance covers damage to buildings, equipment and inventory. crop insurance provides protection for losses from weather events or pests. business interruption covers lost income if operations are disrupted. workers’ comp covers medical costs and lost wages for on-the-job injuries. equipment breakdown insurance pays for repairs if specialized machinery fails.
pricing can vary depending on your individual business factors, but estimated averages include: general liability insurance is around $2,500 annually. property insurance is around $5,000 annually. crop insurance is $12-15 per $100 of gross revenue insured. business interruption insurance is $1.50 per $100 of annual gross revenue. workers’ compensation insurance is $3.87 per $100 of payroll. equipment breakdown insurance is $3,000-5,000 annually.
factors that can impact business insurance pricing include things like your business’s annual revenue, number of employees, property values, claims history, safety protocols in place, and risk level/profile based on your operations and location. having good risk management practices like safety training and equipment maintenance can potentially help lower premium costs over time.
yes, if you have multiple greenhouse, nursery or farm locations you’ll likely need to purchase separate policies or endorsements for each individual location to ensure proper coverage. your insurer can help determine the best structure and pricing approach based on your specific operation.
many insurers offer package or bundled policies that can provide savings compared to purchasing individual policies separately. bundling typically includes general liability, property, crop and other common coverages into one policy. speaking to an agent about your total insurance needs is recommended to explore bundling options tailored to your business.
