Agriculture by its nature is an unpredictable business. This is why farmers need to be prepared for whatever the weather, livestock or generally farming life throws at them.
From cold, wet Springs affecting lambing and summer harvests, to rain-soaked winters leading to flooded fields and buildings, farmers face a seemingly never-ending wave of potential challenges which could potentially impact on their business.
But what happens when the worst happens? You take out farm insurance to ensure that your property, assets, and ultimately your livelihood is protected against the unpredictable.
It means that you can rebuild a shed which is damaged or destroyed by unforeseen incidents such as a fire or flood, or repair or replace a vehicle involved in an accident. Insurance is there to ensure you can get back on your feet as quickly as possible whatever life throws at you.
While your standard farm insurance policy will provide cover for replacement or rebuilding costs, it will not cover you for any loss of income or profit incurred during the time that your business is out of action.
Business interruption insurance is an additional optional cover which protects your business against loss of income during periods when you cannot carry on as usual due to an unexpected event. It covers the revenue lost if you are forced to shut down your business or reduce production unexpectedly and aims to make sure that your business is in the same trading position as it was before the incident occurred.
Most business interruption policies will cover damage caused to your premises or equipment caused by a fire, flooding or a storm. It can also provide cover for the breakdown or loss of a piece of equipment crucial to the running of your business.
For example, if you’re a dairy farmer who experiences disruption to your milk supply due to a major event such as a fire affecting sheds or a forced cull of the herd, then business interruption would cover the lost revenue incurred during the time it takes to resume milk production again.
Business interruption insurance will also cover you for any expensive equipment you need to hire as a temporary replacement, the cost of any overtime incurred or for additional staff you may need to take on to get you through, and for the impact on your finances if one of your suppliers suffers damage to their property which puts them out of action.
It can take a long time to recover following an incident which dramatically impacts on your business and in many cases the rebuilding process can take much longer than you may think. That’s why it’s important to have the peace of mind that you will have an income stream to cover any potential lost revenue during that period.
As a broker, we work with our clients to get them the right cover at the right price for their business to ensure they can continue to operate their businesses whatever happens. Suffering a devastating event such as a fire or flood is bad enough without the worry of how you will pay bills or wages.
While we certainly can’t predict the future, there are ways you can protect your business against the unexpected.