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Is your Agri-business’ liability fully covered?

4th June 2020

As the country starts to emerge from an enforced lockdown as a result of the COVID-19 pandemic, the harvest still needs picking, retail outlets are gradually re-opening and the nation is venturing out into the countryside, which brings with it a series of inherent risks for farmers.  Here Chris Clement, Commercial Director highlights what this could mean to rural and agricultural businesses, especially in terms of liability.

“Here at H&H Insurance Brokers, we are encouraging any agri-business at this time to check their insurance to ensure that their risks are covered and for peace of mind.  Whether you are a hobby farmer or a large-scale production farmer, you still have liabilities which may be more exposed at this time.”

Areas that Chris says should be considered are:

  • Public Liability – it is extremely important for any business to protect themselves, the minute that you allow someone onto your land, you become liable for their safety. Many general farm insurance policies cover death from accident, sickness or disease in livestock and theft, but often thought is not given to the increasing interaction with the general public, that exposes farmers. With many farmers having footpaths across their land, these will become increasingly attractive routes to those out for their extra allowance of daily exercise, which will pose a threat. There are also guidelines as to what is acceptable best practise, for example, it is not advisable to keep cows with young calves in a field where there is a public footpath as dogs can pose a significant risk and these guidelines will be provided within any cover you have. It is also an expectation that paths and fences should be kept in a safe order to reduce the risk to the public, as not doing so could in fact invalidate any policy.
  • Employer Liability – adequate cover for employees is mandatory and all levels are available to meet individual needs. Even a very small business should have this to cover their staff, it is not a place to cut insurance corners.  There can be some confusion as to what constitutes an employee.  For example, If you ask a friend or neighbour to look after your farm while you are away on holiday, even if this is voluntary, it still counts as employment, because they are under instruction from you. COVID-19 has also caused the furloughing of many staff that have been encouraged to support the shortage of immigrant workers to pick the fruit and vegetable harvest. However, farmers must be aware that these extra hands need protecting whilst under their employ and on their land, even if their attendance is only seasonal or temporary.

Retail outlets are also set to re-open this month, this too will have an impact on many farming businesses that have perhaps diversified into the service sector, for example, by opening an ice cream parlour, which will need staffing.

Whether these staff are permanent members of your team, or if you decide to offer contracting services for staff, it is essential to check that in case of problems or accidents, you are covered.

  • Product Liability – this protects against claims for personal injury or property damage caused by a product you sell or supply. It may be that you are offering pick your own or selling farm-made cakes, but if someone becomes ill or hurt because of your product, are you covered for losses?
  • Bespoke Farm Diversification – many farms make more money from their diversification than farming itself so whether you have added an ice cream parlour, a barn wedding business or camping and glamping pods, once the UK comes out of lock down again, these areas will be back in business again. Many have diversified without checking the impact on their insurance policy, so in this quiet period, take time to review this and keep your policy up-to-date.  If you are thinking about a new enterprise, now is the time to plan and include in that the assessment of your insurance needs. Changes to requirements can happen at any time and we wouldn’t want an insurer to refuse a settlement because they were not aware of the changes you have made to your business.
  • Smallholder Insurance – Owning a smallholding has become an attractive asset to have, however, the potential cost of not having the correct cover in place, could be, very high. Farmers who have high numbers of livestock and many acres, generally have an all-encompassing farm insurance. This is not the case for hobby farmers and smallholders, despite the similarity of risks, therefore it really is paramount that you have the right level of insurance.

Chris concludes:

“What I would really like to emphasise is that when we are talking about liability claims of any type, these claims are rarely settled at small amounts, they are always substantial claims that could even break a small business.  So, taking the time to look at your insurance documentation, or seek expert advice, could save you a lot of heartache in the long term.

“Many incidents are beyond our control, as has been evidenced with the crisis resulting from the pandemic, however, insurance exists to protect parties from the unexpected and should never be seen as an unnecessary expense, especially when it comes to liability. Being able to claim in a time of crisis can cushion events when the worst happens.”

Although the H&H Insurance Brokers’ team has been home-bound throughout the lock down, Chris wants to assure new and existing clients that they are very much open for insurance enquiries as well as claims.  If you have a query or insurance requirement, why not call Chris on his mobile: 07527 908513  OR if in the Wales area call Haf Rowley on her mobile 07720 970684 or email us direct in complete confidence.