Hot topics & tips on the ever changing business of farming

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Farm Insurance Reminders for Harvest

Foreign Object Coverage

If a rock or another foreign object is ingested into your combine causing damage, please notify your agent immediately. Insurance companies may have strict rules to be followed in order for a claim to be paid. For example:

  1. Immediately stop harvesting
  2. Turn claim in within 7 days or prior to deadline (ex: December 10th)
  3. Loss limit might apply ( ex: $10,000)

Verify your Foreign Object Coverage. Some insurance companies require the combine and heads to be specifically listed on the policy or have a special endorsement for coverage to be provided.

Precision Farming Technology Equipment

Verify insurance coverage for your Precision Farming Technology Equipment. Typically, if the precision equipment is mobile, it needs to be listed on your policy. If the equipment is part of the tractor/combine, the value of the equipment should be added to the value of the tractor/combine.

Borrowed, Rented, Leased Equipment

How much coverage do you need?

How much coverage do you have?

Sometimes you may borrow, rent, or lease equipment unexpectedly during harvest. Remember to notify your agent of these types of situations to endorse coverage on to your policy.


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Actual Cash Value on Farm Outbuildings

What does Actual Cash Value (ACV) coverage mean?

At claim time, the insurance adjuster will pay the claim based on what the farm outbuilding is worth, but not to exceed the limit specified on the policy.

How does an insurance adjuster determine the ACV of a farm outbuilding?

First, the adjuster will determine the replacement cost of the building using a estimator software. Age, square footage, construction type, roof type, flooring, and heating are a few of the inputs used to estimate the replacement cost of the farm outbuilding.

Next, the adjuster will apply depreciation to the building according to age and condition. The age and condition of the roof and siding have the greatest impact on depreciation. If a roof had a life of 30 years and the roof was replaced 15 years ago, 50% depreciation would apply to the value of the roof. If the roof was “weathered” more than an average 15 year old roof, more depreciation would apply based on the sub-standard condition.

Here is a table to use when determining the approximate depreciation of a farm outbuilding:Building Depreciation Estimator.

How does understanding ACV coverage benefit you?

Insuring actual cash value farm outbuildings at an adequate limit is important to your pocketbook. Money could be left on the table at claim time, if you under-insure an actual cash value building. Yet, over-insuring an actual cash value farm building inflates your insurance premiums. By understanding the replacement cost and depreciation, you can adequately insure your ACV farm outbuildings.

Visit with an agent, like myself, to review and update your coverage limits.

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Pollution Coverage for Livestock Farmers

Environmental Liability is a hot topic in agricultural news. Livestock farmers have environmental liability exposure in regards to managing livestock manure. Examples include: improper ventilation, pumping/handling, transit, and application. Environmental clean up costs tend to run in the hundreds of thousands of dollars. The question is: Does insurance coverage apply?


Earlier this month the Independent Agent website posted an article in regards to Wilson Mutual v. Falk.

“On Dec. 30, 2014 in Wilson Mutual v. Falk, the Wisconsin Supreme Court determined that the standard ISO pollution exclusion excluded losses caused by bacteria seeping into wells after a farmer spread manure on a field. – See more at:”

Pollution exclusions are common on farm insurance policies. Although, most companies offer a Limited Farm Pollution Liability Endorsement that provides limited pollution coverage. Typically coverage includes bodily injury and property damage arising out of discharge, dispersal, seepage, migration, spill, and release of agricultural chemicals, liquids, and gases intended for use in normal and usual farming operations. But I have found the scope of coverage will differ greatly upon insurance providers.

Here are some questions to ask in regards to your coverage on a Limited Farm Pollution Liability Endorsement:

1. Does the definition of pollutants include waste or animal by-products?

2. Is odor or smoke covered?

3. Is coverage provided on and off premise?

4. Is coverage provided for sudden/accidental and overtime?


Other considerations include:

1. Are you performing custom work?

– Most policies do not provide coverage for custom work.

2. Are you transporting manure with farm equipment or are you using a licensed road vehicle?

– If using a licensed road vehicle, you need to look for coverage on your auto policy.

I expect insurance providers will be discussing policy language moving forward. The Limited Farm Pollution Liability Endorsement on your farm policy is a step in the right direction, but there are many gaps to be filled. A separate site pollution policy might be an option for you; minimum premium could range from $3,000- 5,000/year. If you provide custom application services, a Contractors Pollution Liability policy can be purchased starting at $2,500/year minimum premium.

I recommend reviewing your pollution coverage with your agent.  You can also contact me with questions, or 641-847-3555. I am happy to review and seek coverage.

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Coverage for Tree Removal

Rain, wind, and hail seemed to be the theme in Iowa this June. Many trees lost limbs, snapped in half, or were uprooted from the soil!


Generally, an insurance policy allows $500 of coverage per tree for loss caused by specific perils.

  • Fire
  • Lightning
  • Explosion
  • Riot or civil commotion
  • Aircraft
  • Non-owned vehicles
  • Vandalism and Malicious Mischief
  • Theft

The coverage limit provided is 5% of your Coverage A limit, also called dwelling limit. For example, if you insure your home for $100,000, you are provided with up to $5,000 of coverage.

Windstorm, hail, or weight of ice and snow are not included in the list. You may have coverage for the tree under debris removal if the tree damaged a covered structure or blocked a driveway or blocked a ramp for the handicapped. If coverage applies, $500 per tree up to $1,000 is provided for debris removal.

Debris removal coverage if damaging the covered structure.

Debris removal coverage if damaging the covered structure.


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Drones: Unmanned Aircraft Systems

Thinking about purchasing a drone? You are not alone. Drone industry experts believe that every farm will be using drones in the next 10 years.


As I meet insurance company representatives, I ask about new changes they are making to their policies. Being able to insure drones is the number one answer. Many insurance companies are still in the planning stages, but a few companies are able to provide coverage today.

To be eligible for coverage there are guidelines to follow.

1. Drones cannot be homemade.

2. Coverage is limited to precision agricultural operations.

3. Drones must be operated within Federal Aviation Administration guidelines.

4. Drones must be flown 3 or more miles from any airport available for public use.

5. Drones cannot be flown over a town, city, or other urban area.

Liability coverage will exclude personal injury (for example: libel or slander) and invasion of privacy. Property coverage is provided on an actual cash value basis.

Property exclusions include:

1. Loss or damages caused by repair, adjusting, servicing, or lack of repairing, adjusting, servicing, or maintenance unless fire or explosion ensues. Coverage will then apply to damage caused by such fire or explosion.

2. Mechanical or electrical breakdown

3. Mysterious disappearance

4. Theft, unless there is substantial proof of theft

5. Coverage while drone is rented or leased to others

The cost to insure drones will vary. One of our companies provides liability coverage at a rate of $15 per drone and property coverage at $3.75 per $100 of coverage with a $500 deductible. Drones can also be added to the umbrella policy at a rate of $5 per drone.

If you have specific questions, please give me, Betsy, a call at Ibeling Insurance, 641-847-3555.

Here is an article from Nationwide Agribusiness AGVISOR; 1_AgVisor_Drones

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Farm Personal Property Upkeep

Let’s briefly discuss the two categories of farm personal property on an insurance policy. The first is scheduled farm personal property. Each item is listed with a specific limit. The second is unscheduled farm personal property, also known as a blanket. The blanket covers all farm personal property at the insured location under one limit.

Below are 4 things you need to know about keeping your farm personal property up to date.

1. Insure at least 80% of the actual cash value of  your farm personal property to prevent a co-insurance penalty at the time of loss. The co-insurance penalty will be determined by dividing the coverage amount by the minimum coverage amount required (80% of actual cash value). This percentage will be applied to the final adjusted loss to determine the claim settlement. This co-insurance clause applies to both scheduled and blanket farm personal property.

For example: You have a tractor worth $100,000. You are required to insure at 80% of actual cash value, $80,000. If you chose to insure the tractor at $60,000 and have a $10,000 claim a co-insurance penalty will apply.

($60,000 amount carried/$80,000 amount required x $10,000 loss = $7,500 settlement)

If the loss happens on your blanket farm personal property, the insurance company evaluates the actual cash value of the entire blanket.

2. Report any newly acquired farm personal property within 30 days of purchase. You have coverage for the first 30 days at actual cash value. The most the insurance company will pay for all such farm personal property could be a percentage (example: 25%) of the coverage amount for all covered items or a specified dollar amount (example: $50,000). This applies to scheduled farm personal property.

3. Report any replaced farm personal property within 30 days. You have coverage for the first 30 days at the smaller of the following; the amount shown for the item replaced plus an additional specified amount (example: $25,000) or the actual cash value of the item. After 30 days, the most the insurance company will pay is the coverage amount shown for the item replaced. This applies to Scheduled Farm Personal Property. 

4. Review your farm personal property coverage limits on an annual basis. In most cases, the actual cash value of your Farm Personal Property will depreciate. You can decrease coverage limits to maintain adequate actual cash value coverage.

In conclusion, farm personal property upkeep includes; maintaining coverage limits of at least 80% of actual cash value,  reporting newly acquired or replacement farm personal property within 30 days, and reviewing coverage limits on an annual basis.



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Cosmetic Damage on Metal Buildings/Roofs

Hail season is just around the corner! If you have experienced a hail loss, you know the severity of the damage and amount of work to put into repairs. In the past few years many insurance companies have increased their wind/hail deductible minimum to $1,000 and increased their property rates.

Replacing roofs is one of the biggest driving factors in premium increases. Metal buildings and roofs are more common today. The debate on claim payments for hail damaged metal roofs and buildings continues. The question is; at what point should the insurance company pay for a new roof?

Insurance companies have grouped hail damage into cosmetic damage and functional damage. There is no question that functional damage will be paid to the insured. If the roof is no longer able to perform its function, a replacement is a necessity. But what if the roof is functional? The hail dents the metal adversely affecting the building’s appearance. Should a payment be awarded?

Curt Bockenstedt 015Sunner pictures 006

Insurance companies have left this option up to you. You can choose to have cosmetic damage on one or all of your metal buildings/roofs. You can also choose to exclude cosmetic damage. Be sure to talk to your agent about cosmetic damage. The coverage could be included automatically and removed to receive a discount. Or the coverage may need to be endorsed onto the policy.

Claim time is not the time to realize your coverage. We want you to be covered!