What Is Farm Insurance and Why Is It Important for Every Farmer
Tuesday, April 17, 2018
As around 55% of all American farmers are older than 50 years of age, it is probably the most practical time to start considering all the things that could go awry in the absence of any insurance. However, it is largely seen that many of these farmers don’t have either a life or home insurance despite of the demanding nature of their occupation.
Although farming is a multi-million dollar industry that generates large profits for those involved, many of the farmers still aren’t able to earn enough. This is because of the huge expenses that go into the business which take up a major chunk of their overall earnings. On an average, farm expenses can go well over $100,000 annually. Therefore, many farmers shy away from any sort of insurance other than life insurance.
However, with the increasing number of floods, hurricanes and other natural disasters, the million-dollar investments face the threat of destruction. Therefore, it is very important for farmers and agriculturists to always remain on the safe side and protect their livelihood.
Farm insurance, also known as agriculture insurance, is meant to safeguard all of the farm investments. These insurances cover everything from farm animals to farm equipment to crops and other important factors of production on an agricultural land.
A farm insurance policy works just like the other insurance policies. The farm owners pay premiums to the insurance company according to predetermined timelines. These premiums are accumulated and added to the insurance amount to generate a hefty insurance amount that will be provided once the policy reaches maturity.
Mostly farm insurance companies send their representatives to visit the farm where they examine the animals, crops and all of the constructions on the site. After clearing the evaluation, the farmer’s application is approved and they are guided through the payment process.
Features of Farm Insurance
Around a million dollars worth farm insurance has been provided to farmers across the country. These insurances include coverage for crops and livestock as well as equipment. The recent increase in the number of farm owners interested in agricultural insurance is because of the unique features many such insurance companies are offering. For example,
Farmers are referred to as the nation’s most crucial workers. Hence, Farm insurance policies have been rightfully designed to ensure their well-being and protect them against any misfortune while allowing them to maximize their production and profits.
- Farm insurance is available to any business that produces and sells agricultural products worth at least $1,000. This makes it easier for almost every farmer to apply for insurance regardless of their size of business.
- Farm insurance provides the option of claiming a refund of more than $50,000 by filing for tax return.
- Farm insurance also covers the cost of buying new technologies to improve farm efficiency. Since these advanced equipment are somewhat risky investments, the insurance policy covers the loss in case of a malfunction.
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