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Farm Insurance: Under insurance and managing risks

22 September 2020

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As we approach the 2020-21 bushfire season, this year’s bushfire season is one that will live long in our memory, and rightly so. It was officially the worst ever when 34 people directly lost their lives, billions of animals perished, and more than 3,000 homes – many on farms – were destroyed.

Claims relating to the bushfires are estimated to be over $2bn, illustrating the significant impact communities faced.

For many farms that were affected by the bushfires they faced fire losses but also found that they were significantly underinsured.

The problem of underinsurance

Underinsurance – or in other words, not having the right amount of cover, or the right things covered – is a huge problem in Australia. 

“Unfortunately, as we’ve seen as a consequence of the bushfires, a lot of people didn’t insure their property to the true value or sometimes didn’t insure things altogether,” says Rod Ostrognay, National Product Manager for
Elders Insurance Rural Products.

“When you have a significant loss from a bushfire, you find you’re sometimes hundreds of thousands of dollars short of what it costs to replace those items.

“For example, people take out small farm home cover forgetting about added costs to rebuild in bushfire zones, the costs of water tanks, solar systems, remote power costs and the need to specifically include the machinery sheds, stables and fencing.”

Covering all aspects 

Bushfires are just one of many risks farms face. From escaped livestock and stolen machinery to business liability, there’s an awful lot of risk exposure for farms.

“There are so many things you need to consider so you have the right levels of cover for your farm,” explains Rod.

“You’ve got home and private car, then you’ve possibly got sheds, livestock, horse, sheepdogs, commercial vehicles, maybe a boat, and then you’ve got shed contents and machinery, grain and hay stocks, tax audits – the list goes on.”

Farm insurance – it’s not just for the pros

With an increasing number of people considering a lifestyle change - leaving the city for a different kind of life in rural and regional areas. Regions where property prices are more affordable and life has a different quality. The number of people who will potentially need farm insurance – and expert advice - is growing. Put simply, farm insurance isn’t just for farmers.

“On one end of the scale you can have a single home on some land, or a hobby farm where you've got a home and small farm assets – you might have some livestock or horses, or maybe grow a few veggies and sell them at the local market,” says Rod.

“Then you've got your regular farming operations, right up to the large or corporate-type farming operations.”

If you carry out farm activities or live on a lifestyle farm, such as a small hobby farm, that’s two hectares or more in size, then the Elders Insurance Farm Pack is the right product for you.

The right farm insurance policy for you

Of course, we know that every farm is unique, which is why at Elders Insurance we offer flexible insurance that can be tailored to ensure your farm has the right coverage for you. 

Our Farm Insurance includes everything from farm property to liability, business interruption to working-dog cover, farm vehicles to machinery breakdown, and is underwritten by farming experts.

“Ultimately, insurance is about protection – and while you don’t want to be in a position where you have to use it, it’s always reassuring to know that if you need it, it’s there,” says Rod. 

“It’s so, so important to get the right cover for you and your farm.”

Your local Elders Insurance Agent can help you explore every aspect of your farm operation and tailor your cover to meet your needs. Contact us today to learn more.  


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