I have the pleasure of talking to many existing and potential new clients on a daily basis. A question that comes up in almost every new farm appointment I have… Since I store my hay & straw in a building that’s insured, it is automatically covered, right?
Unfortunately, hay & straw are not automatically covered under a standard farm policy. If you have any livestock on your property, we can assume that at some point in time during the year you are going to be storing some hay to feed during the winter months and possibly some straw to bed up with during the colder season.
Just as during the summer months, many farmers are making hay for their own use as well as hay to be sold either out of the field or to be sold at a later point in time. We all know how much the hay equipment costs and the high price of diesel to run the tractors to make the hay, as insurance agents, we need to make sure you are protecting this asset. One unexpected lightning strike, fire, violent windstorm, or collapse of a building due to the weight of ice or snow could instantly affect your farming income for the year and/or your ability to feed your animals.
Here are a couple of things to consider when deciding how to insure your hay & straw:
- What is the estimated highest number of bales stored in the building(s)?
- How much do I intend to sell these bales for over the course of the year?
- Does the inventory only stay in the building for a few short months?
- Do I buy most of my hay or straw out of the field during the summer months when it’s a little cheaper?
The above questions help us better understand your farming operation. When discussing hay & straw coverage, most producers want to insure their total crop’s value for the course of the season. That way if there is a total loss, the adjusted work with our farmer to determine the number of bales lost and pay out the claim accordingly based on true market value. We also have the option to insure the hay & straw on a “peak season” schedule.
During the summer into early fall months, we insure for the total value then thru the winter months, when hay & straw is sold or used, we have the policy automatically decrease coverage. For example, we might have a peak season schedule June- December with a limit of insurance of $20,000, then January – February limit of insurance of $10,000, and then March thru May a limit of insurance of $5,000 to account for increasing and decreasing inventory. Also, keep in mind, if you buy all your hay & straw in the summer months out of the field, you are generally getting it at a little cheaper price. You might want to consider insuring it for a true market value. That $40 round bale of hay that you purchased in June may cost you $50 if you had to purchase it in January.
Hay & straw can be easily forgotten when discussing your farm policy. Your home, buildings, farm equipment, and livestock are always on the forefront of any insurance review. Make sure to always discuss the hay & straw coverage as well as grain stored in structures. These commodities hold a lot of dollar value and ultimately determine your bottom line at the end of the year.
You spend your life dedicated to your farm. Let’s work together to make sure you are properly insured going forward. Reach out to Ryan Wiles today to learn more.
Blue Ridge Risk Partners is a top 75 independent insurance agency in the United States. With 22 offices and counting throughout Maryland, Pennsylvania, and West Virginia and access to hundreds of carriers, we are able to meet your unique insurance needs.