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Farm Insurance, Simplified: A Guide To Determining The Best Coverage For Your Farm

Posted by CFM Marketing on 01, Feb 2023

1. 4901_Farm Insurance Simplified_Blog_TitleFarming isn't one of those straightforward professions that any average Joe can tackle. Simply put, it's hard work - like really hard work. Operating a farm is beyond intimidating and challenging, yes, but arguably one of the most necessary and rewarding jobs on the planet. In all honesty, if you farm, please stop reading for a minute and give yourself a pat on the back.  

As someone who belongs to the demanding Ag industry, you know there's more than enough on your own plate while you're working to put food on the tables of others. Why add "figuring out my farm insurance blueprint" to the growing to-do list? After all, building an insurance policy to cover a farm and all its moving parts adequately is far from simple. You're not a hobby farmer - this isn't a side gig to you. Operating your farm is your moneymaker, your way of life. Because your farm generates income, it will need far more complex coverage than a standard home insurance policy can offer. 

As a Mutual Insurance Company formed by a few farmers to protect other local farmers over 150 years ago, you could say we know a thing or two about farm life and how to protect it for generations. We have a dedicated team of Underwriters, led by their spunky, driven, and insurance-savvy Manager, Stef, to organize the meticulous buildout of farm policies submitted by our agents for their CFM customers. So, take a much-needed break and let us walk you through the insurance part of your business with the help of Stef. That way, you can confidently determine the best coverage match for your unique farm - big or small.

An Intro To Farm Insurance: Basic, Broad, And Special Form Coverage

6. 4901_Whats Covered_Blog-01Farm insurance is designed to cover you both personally and commercially. Just as home insurance safeguards your dwelling, possessions, and personal liability, farm insurance provides all of those coverages plus protection for your machinery and livestock exposures. To understand the level of insurance coverage your specific farm needs, you'll need to familiarize yourself with the three levels of forms that underwriters use to match your farm with a compatible policy type. 

Farm insurance coverage forms are broken up into three categories: Basic, Broad, and Special. As you could venture to guess, Basic Form coverage is the most restrictive level, with Broad and Special Form coverage offering greater defense against threats to your farm. 

Basic Form Coverage: Protection Against 10 Perils 
  • Fire, lightning, wind, and hail
  • Collision
  • Damage in course of transit
  • Explosion
  • Riot and civil commotion
  • Sinkhole collapse
  • Smoke
  • Theft/Vandalism
  • Vehicles
  • Volcanic Action
Broad Form Coverage: Protection Against 15 Perils

Includes all the basic coverages above, plus the following:

  • Accidental discharge and leakage of water system
  • Accidental shooting of livestock
  • Artificially generated electrical current
  • Attacks on livestock by dogs or wild animals
  • Glass breakage in a building or structure
  • Bursting of heating or water systems
  • Collapse
  • Electrocution of livestock
  • Falling objects
  • Flood loss to livestock
  • Freezing of plumbing, heating, AC, automatic fire protection system components, and household appliances
  • Loading and unloading accidents
  • Sudden and accidental collision damage causing death of livestock
  • Sudden and accidental tearing apart of heating, AC, or water system
  • Weight of ice, snow, and sleet
Special Form Coverage

Special Form does not specifically list perils; instead, it is “all-risk” coverage unless otherwise excluded by your policy. In other words, unless the policy states a peril isn't included, it's included and should cover your potential loss. Typically, Special Form coverage is the preferred level of protection you'll want for your farm. But because it is more comprehensive coverage, many companies will require that your property has certain updates.

What Does A Typical Farm Policy Cover?

  • Home & Contents

    The primary residence you and your family occupy on the farm is covered by a structured portion of your policy specifically for your dwelling and personal property filling the space. 
  • Farm Personal Property/Structures

    It's no secret that the equipment you use every day to perform your vital job isn’t easy (or cheap) to replace. That's why each policy in our Farm Program comes with the best protection to ensure your farm machinery and equipment are covered in the event of a loss.

    Whether big or small, your farm likely has multiple buildings on the property. The Farm Personal Property portion of your policy includes those structures aside from just your house. Machine sheds, detached garages, grain bins, barns, hoop buildings, other outbuildings, and the equipment stored in them would also fall under this coverage.

  • Farm Liability

    Farm Liability coverage protects your assets in the event a lawsuit is filed against you. Accidents can undoubtedly happen more often than not around the farm. A potential liability claim can be costly and damaging to your operation. With a healthy, totally customizable Farm Liability reserve worked into your policy's coverage guidelines, you can rest a bit easier knowing you're protected from expensive bodily injury claims or accidental property damage claims.

  • Livestock 

    From dairy cows and hogs to beef cattle and sheep, your livestock are substantial investments — so they require their own specific coverage under your farm policy. Accidents, sporadic Missouri forecasts, and crimes are all unpredictable. That's why knowing your livestock are protected from the unexpected thanks to your farm insurance is so comforting.

CFM Farm Insurance Policy Breakdown

At CFM, we understand Missouri farms. Considering the decades of farm underwriting and claim handling experience, our team has built several policy types designed to best cover the various levels of investments hanging out on your farm. By offering customizable protection for your machinery and equipment to your home and livestock, CFM can keep your livelihood safe against common threats like Mother Nature, theft, breakdown, and much more.

Remember our knowledgeable Underwriting Manager, Stef, mentioned earlier? Well, she's here to breakdown those policies and provide valuable underwriting insight along the way, so you can get a better idea of what insurance offering would fit your farm for the long haul. 

Underwriter Insight: While each farm policy provides different levels of coverage for varying levels of farm exposures, you'll find that the only factor affecting each category of protection depends primarily on the dwelling value. If your farm home is expansive and brand new, it will likely fall under our Exclusive program. On the flip side, if your farm home is more modest in size and older, seeing few updates throughout the years, it may not be valued as high as an 'Exclusive' home. The value of your primary residence will ultimately be the driving factor as to what policy type your farm will be placed with.

Meet The Farm Policy: Farmstead Exclusive

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Policy Fast Facts

  • Offers Replacement Cost Coverage: This term refers to the amount of money it would take to replace your damaged or destroyed home with the exact same or similar home in today's market.

  • Minimum Dwelling Value: $150,000.

  • Standard Liability Coverage Limit: $1,000,000 or lower. 

  • Water Damage - Sewers, Drains, and Sumps - Coverage Limit: $10,000 

  • Dwelling Age: 25 years or less.

Underwriter Insight: Any farmhouse with solid fuel or wood heat systems as the primary source of heat would not be accepted under CFM's Underwriting Guidelines. Through the lens of an insurance underwriter, fireplaces are great for featuring mantle decorations over the holidays or providing that cozy, Instagram-worthy spot to curl up by on movie nights. But they're simply not meant to serve as a home's sole heat source during those brutal Missouri winters. The same goes for wood burning stoves - they should act as a supplemental source of heat - not the only source of heat. 

Meet The Farm Policy: Farmstead

3. 4901_Farmstead_Blog

Policy Fast Facts

  • Offers Replacement Cost Coverage

  • Minimum Dwelling Value: $100,000

  • Standard Liability Coverage Limit: $1,000,000

  • Dwelling Age: 60 years or less.

Meet The Farm Policy: Farm Protector

4. 4901_Farm Protector_Blog-1

Policy Fast Facts

  • Offers Replacement Cost Coverage

  • Minimum Dwelling Value: $60,000

  • Standard Liability Coverage Limit: $500,000

  • Dwelling Age: 70 years or less.

Meet The Farm Policy: Farm Basic & Limited

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Policy Fast Facts

  • Offers Actual Cash Value: This term refers to value of your property today, not what it cost when you originally bought it or built it. 

  • Minimum Dwelling Value: There is no specified home value for this policy-type. However, underwriting guidelines indicate the minimum cost per square foot of floor space for a qualifying dwelling in this program needs to be $40.
  • Standard Liability Coverage Limit: $500,000

  • Dwelling Age: Older homes acceptable with updates.

CFM Farm Insurance Policy Perks + Optional Coverages

7. 4901_Optional Coverages_Blog-01Who doesn't love options? When we say our Farm policies are super customizable - we aren't lying. Check out some of our most popular optional coverages for farmers like you to choose from.

Equipment Breakdown & Service Line Coverage

Equipment Breakdown and Service Line Coverage come with all our farm policies by default. This means unless the farm policyholder opts to have these beneficial coverages removed, they can be utilized to compensate the insured in an applicable claim scenario. Equipment Breakdown Coverage can protect you from losses caused by electrical or mechanical breakdown. And as you know, breakdowns can be a pretty common occurrence during a farm workday. Service Line Coverage protects the underground pipes and wiring servicing your residence on the farm. 

New Construction Credit

Our Farmstead Exclusive, Farmstead, and Farm Protector policies provide a New Construction Credit to newer farm homes in generous amounts ranging from 3%-20%. Cha-ching, cha-ching!

Winter Livestock Perils 

CFM provides special coverage for livestock, including our Winter Livestock Perils endorsement. This endorsement covers your cattle, sheep, swine, goats, horses, mules, and donkeys if they are affected by common threats like freezing or smothering in a snow or ice storm or falling through ice at your farm's pond during the winter.

Farm Machinery Blanket

A relatively new addition to our Farm program is the CFM Farm Machinery Blanket.

Underwriter Insight: The CFM Farm Machinery Blanket gives the insured and agent the easability of not having to update the scheduled machinery list on the farm policy each time a piece of equipment is sold or traded. Blanket coverage provides all the same coverages as 'Described Machinery;' the only difference is the equipment isn't listed out line-by-line. An updated list of farm machinery and equipment needs to be sent in every three years by the policyholder and agent. It's a great option for farm policyholders who have a large amount of equipment and trade or buy new equipment frequently. Combines and irrigation equipment are excluded from the blanket.

Farm Loss Of Income Coverage

Farm Loss of Income coverage can be added on any of our CFM Farm policies. This valuable coverage pays for the actual loss of farm earnings normally incurred and earned by a farming operation, should the business be interrupted by direct physical loss to farm buildings, machinery, equipment, or supplies. This option also provides coverage for the necessary extra expenses incurred to resume or continue the farming operation as nearly as practicable.

Grain, Hay, & Other Farm Supplies/Products Coverage

As you could probably guess, grain, hay, and other farm supplies and products (stored in buildings or in the open) are covered under this portion of your farm policy. Hay, straw, and fodder in one area is considered one stack if separated by a clear space of 100 feet or more from any other hay, straw, or fodder in the open. If no specific “limit” is shown on the declaration page of your policy for any one stack, the maximum coverage per stack of hay, straw, or fodder in the open is $40,000.

ATV/UTV Coverage

When you live on a farm and need to bounce around the land a little quicker than you could on foot, it may be beneficial to add an ATV or similar mode of transportation to your farm inventory. Through our Inland Marine endorsement, your four wheeler or side-by-side would be covered up to the amount it's worth. 

CFM Farm Insurance Discounts You'll Love

  • Crop Insurance Discount: Though CFM doesn't provide crop insurance, we do reward our farmers for having it with the same independent agent who services their CFM Farm policy. 

  • Traditions Discount: Does farming run in your family? If so, you can save money on your CFM Farm Policy. Thank you for keeping your family farm alive and well for the next generation.

  • Missouri Cattlemen's Member Discount: If you're a member of the Missouri Cattlemen's Association, contact your agent for a 5% discount on your CFM Farm policy as a 'thank you' for serving the cattle industry in our great state.

  • Missouri Soybean Member Discount: This beneficial offering is the newest addition to our discounts family. If you're a member of the Missouri Soybean Association, contact your agent for a 5% discount on your CFM Farm policy to show our appreciation of all Missouri farmers.

Are You Ready To Build Your Personalized CFM Farm Policy?8. 4901_CTA Farm Insurance_Blog-01

If any of our farm policies appear to be a great fit for your operation, reach out to one of our many local agents across the state of Missouri. Just click the picture above and find an agent closest to you!

Taking Her Farm Roots To The Office: Meet Robin Chambers

Robin C

Robin Chambers, our Farm Underwriting Supervisor who starred in this blog (striking resemblance, right?), has a ton of experience in the insurance underwriting world. She also happens to have rural Missouri roots and farming experience, making her a seasoned expert in the field of farm insurance.

Here's a little background on Robin and why you should trust your farm is in good hands when pros like her organize your coverages.

Robin started her insurance career in 2012 at an independent agency and small farm mutual insurance company in northern Missouri. Shortly after, she earned her P&C producers license and began selling personal lines insurance, on top of processing policy endorsements, payments, and renewals.

Several years later, Robin shifted careers and began working for CFM as a Marketing Underwriter, primarily training agents on company products and systems. Today, she leads our Farm Underwriting Division at CFM and works in the trenches each day to ensure our farm policy offerings meet the needs of the diverse customers we serve.


Topics: Insurance Information

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