Hurricanes cause devastation to everything in their wake, and are especially damaging to those who work in open fields. Unfortunately, insurance companies may be overwhelmed with claims after a disaster strikes, causing growers and ranchers to be underpaid for their losses. Attorney Bill Voss explores essential forms of hurricane insurance coverage for owners of agribusinesses, as well as what to do if your insurer does not offer fair payment.
Necessary Hurricane Coverage for Farmers and Growers
The first thing agribusiness owners should realize is that many private insurers will not cover certain losses caused by natural disasters. For this reason, it is vital that growers along the Texas coast purchase two forms of additional coverage: a flood policy from the National Flood Insurance Program (NFIP), and a windstorm policy from the Texas Windstorm Insurance Association (TWIA).
That said, you should still have private insurance to cover the specific needs of your agribusiness, such as:
- Farm dwelling. If you or your family live on the property, farm dwelling coverage can cover damage to the home and any landscaping and trees surrounding the land. Insurers may also offer an endorsement for additional living expenses if a hurricane renders your farmhouse uninhabitable.
- Buildings and structures on the property. It is vital to secure coverage for all structures on the property, not just the family dwelling. A comprehensive policy should include private power and light poles, outdoor radio antennas and TV equipment, silos, portable structures, and fences, pens, corrals, chutes, and feed racks. Your insurer may even offer short-term coverage for newly-constructed farm structures, as well as the building material and supplies stored at the insured location.
- Special property. Some items may have historical or special value, and will need an additional endorsement to replace the loss. A farmer who loses several trees due to high winds and flooding may replace the trees, but the new plants will take several years to mature and produce palatable fruit. Similarly, antiques in a historic property or family graves onsite may never be the same as they were before the storm, even after thousands of dollars in restoration costs.
- Cattle and animals. Livestock are at risk of becoming stranded, drowning, or even starving in the aftermath of a hurricane, and should be protected by stock mortality insurance.
- Equine coverage. Your insurer may offer a special equine endorsement to cover damage to equipment, stables, fences, corrals, and property related to keeping and showing horses.
- Farm auto coverage. Farm auto coverage can pay to repair or replace trucks, combines, plows, and tractors, while farm machinery coverage will pay for specialized losses (such as irrigation equipment and milking machines). Endorsements may also cover borrowed, rented, or leased farm machinery, or your own machinery that was lost while away from insured premises.
- Cash crops. Crop insurance is vital for growers, whether they sustain themselves on one type of crop or a variety of different products. Coverage should extend to row crops, fruit and nut trees, flowering plants, and any other plants on the property.
- Feed crops. If you grow feed crops for livestock on one or more fields, this may require a special endorsement.
- Refrigerated goods. Dairy farmers, winery owners, and other growers that process their goods for sale may suffer a loss of power that ruins refrigerated milk, cheese, and other temperature-sensitive products.
- Seasonal losses. One bad year had the potential to bankrupt farms of all sizes, making seasonal protection insurance a necessity. Seasonal insurance can replace profits from selling marred goods at a discount and the loss of crops in the field and those stored and ready for shipment.
- Business interruption coverage. Farming operations may be disrupted for weeks or months after a hurricane, depriving owners of much-needed revenue. Business interruption insurance provides up to six months of income losses, allowing farms and ranches to stay afloat during repairs.
If you are struggling to recover after a hurricane, our attorneys can work to get full and fair payment from your commercial insurance carrier. Simply fill out the form on this page today to contact an insurance attorney at the Voss Law Firm or order a free copy of our book, Commercial Property Owners Must Read This BEFORE Filing an Insurance Claim.