Time for a Checkup! 3 Tips for Getting It Done
Farmers are some of the hardest working people in the world. When it comes to agriculture, be it crops or livestock, farming is a 24-hour-a-day, 7-day-a-week, 365-day-a-year type of job. That’s one of the reasons it can sometimes be tough for farmers to get a regular checkup. No, not the kind you get from a doctor – the kind you get from your farm property insurance or ag-related industry agent! Here are a few tips for making your annual farm property or ag-related commercial policy checkup as painless as possible.
Annual is Best
For most operations, an annual policy review is optimal. Setting a specific time annually to have your agent visit you on-site, review your moveable asset list and any applicable buildings or facilities, and update your policy is enough for most smaller operations.
If your business or operation encompasses more than one facility or multiple locations, you will have to evaluate if it’s possible to visit all locations, and even if it is important for your agent to view additional locations. Some coverage may be able to be underwritten based upon photo or video walk-throughs or other remote options. The best way to know is to ask your agent.
Think About Your Depreciation Schedule
When it comes to quantifying and updating asset lists, a good place to start is always an existing policy or rider. Don’t re-create the wheel if you don’t have to! However, if you haven’t got one of those items readily available as a source document, another good place to start is your operation’s tax depreciation schedule.
Deprecation schedules capture all taxable/saleable assets and are therefore a good jumping off point for completing your operation’s insured asset list. Things like vehicles, tractors and implements, livestock, and other moveable assets, along with any buildings or residences on the operation land, should be captured on your deprecation schedule (depending on the kind of operation you run and the tax forms you are required to complete).
Update Policies with New Purchases
If you are purchasing new equipment (or new-to-you equipment), land or buildings, contacting your agent should your second call after the call to your financial lender. Depending on the state you live in and the type of asset, you have a limited amount of time (called a grace period) to add that asset to your existing insurance policy before it becomes unprotected or uninsured.
For vehicles and implements, this can range from a week to a month. The same period applies for buildings and fixed assets – however, keep in mind these assets might be covered under other policies, like construction companies’ builders’ policies, while being constructed or installed. Adding new assets within the grace periods is preferred. Retroactive asset protection – insurance for new purchases that is secured after the grace period has passed – is possible but can be more cumbersome.
Getting a checkup is never easy, and it’s never something anyone – especially people in the agriculture industry! – has time for. However, done correctly and with a little planning and forethought, it can help protect your operation and your revenues without sacrificing too much of your most precious commodity – your time!