Farm Insurance is often thought of as an unnecessary expense, but it can mean the difference between bankruptcy and solvency.
Understanding Farm Coverage
A basic farm insurance policy has three coverage options: livestock, crop, and liability.
Usually, farm policies have two payout options: Actual Cash Value and Replacement Value. The Actual Cash Value policy pays out what something was worth at the time it was damaged, but not what it would cost to replace. The Replacement Value Policy pays out what it would take to replace something today.
For example, let’s say you bought an antique tractor at a yard sale for $200. How much would your insurance cover if it was destroyed? If you bought the actual cash value policy (which may be cheaper), the answer is $200 because that’s how much you paid for it. But if you bought the replacement value policy (normally more expensive), the answer could be $10,000 because that’s how much it would take to buy an equivalent tractor today.
Protecting Your Farm
While this is a simplified view, your actual farm policy is going to take a bit of work to sort out. Our team is ready and waiting to lend a hand and explain your coverage options to you, and we never charge for a consultation. Click the button below to find out more.
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