A Complete Guide to Farm Insurance - Protect Your Land & Assets

Farming isn’t just a ‘job’. It’s a passion, a commitment, a vocation, and often, a family tradition. Farmers are the custodians of the land, and without their incredible hard work year-round, in all weather conditions, and in the face of huge challenges, our food shelves would be empty. Agricultural insurance is designed to ease some of the burden on our farmers, providing confidence that their land, vehicles, livestock and crops are protected. Without farm insurance, the slightest mishap could turn into a financial disaster.

At Park Insurance, we’ve spent the last 30 years developing a strong relationship with the farming community, providing farm insurance that meets the unique requirements of each farm and the often-tight budgetary restraints it faces. In this in-depth guide to farm insurance, we’ll take a look at the different types of farm cover, the key risks faced by farms, and some essential tips for choosing the right type of insurance policy. We’ll also answer some of your FAQs and steer you away from the most common mistakes farmers make when it comes to choosing insurance.

What is farm insurance, and why does it matter?

The term ‘farm insurance’ actually refers to several types of insurance relevant to a farm. A portfolio of insurance for any farm could include:

• Property and buildings insurance
• Livestock insurance
• Crop insurance
• Equipment insurance
• Horsebox and livestock transport cover
• Commercial car insurance
• Public liability insurance
• Employer’s insurance

We’ll take a closer look at each of these in a minute, but let’s quickly answer the question ‘why does it matter’. The simple fact is that farms are expensive places to run, and the amount of financial investment poured into a farm, regardless of its size or whether it’s a crop or livestock operation, is huge. Essential equipment runs into tens or even hundreds of thousands of pounds. Each animal on a livestock farm has value, and each field of crops sown represents a substantial part of the net income of a farm.

Because farms are vulnerable to everything from adverse weather events to theft, fire, and flooding, the line between profit and loss is very fine. The loss of a major piece of equipment, such as a tractor, or the theft of livestock, can have a huge financial impact on a farm. That is why farm land insurance is such an essential part of running a successful agricultural business.

The different types of farm insurance cover

Farm insurance is made up of a variety of different insurance policies, each designed to protect a different element of your agricultural business. These insurance policies differ from standard policies because they must account for the unique challenges faced by a farm. Agricultural insurance is specifically designed to provide protection against diverse influences such as weather, pests, and disease outbreaks, which are not usually covered by standard insurance.

Property and buildings insurance

Everyone has buildings insurance, whether they rent or own their own home. However, property and building insurance for farms is a little different because of their very specific use. For example, a milking shed on a dairy farmhouses high-value equipment built into the building, while barns may store highly flammable materials such as hay, straw, feed, and hazardous chemicals. Agricultural insurance for buildings considers the unique use of farm buildings.

Livestock insurance

Livestock insurance gives you financial protection against the death or injury of animals as a result of accidents, disease (including bovine TB) and loss due to theft. It’s important not to underestimate the levels of ‘rustling’ or livestock theft in the countryside – the incidences of theft by organised gangs are growing year-on-year. Livestock insurance covers animals such as cattle, sheep, pigs, poultry, and horses. It’s particularly important if you have valuable bloodstock or award-winning livestock.

Crop insurance

Arable farms are particularly vulnerable to the influences of both long-term climate change and short-term adverse weather events. Crop insurance provides financial protection against damage to crops by flooding, drought, disease or pests.

Equipment insurance

Farming equipment is exceptionally expensive and a major financial investment in any farm. Agricultural equipment insurance covers damage, loss or theft of farm machinery such as bailers.

Tractor insurance

Tractors are the workhorses of any farm, whether you’re rearing prize-winning beef cattle, running an arable farm, or have a mixed farm. New tractors can cost close to £100,000, making them targets for organised gangs. Tractor insurance covers your tractor against theft and damage due to flooding or fire.

Horsebox and livestock transport cover

Moving animals around requires a specialist box or livestock transport vehicle. Standard road insurance may not cover these vehicles as they are used for commercial purposes. Horsebox insurance protects your trailer or livestock vehicle and ranges from third-party only to fully comprehensive cover.

Quad-bike insurance

Quad bikes are an integral part of farm life and are essential for moving around large areas, distributing feed, checking on animals, and carrying out everyday jobs. Unfortunately, they are also among the most stolen items of farm equipment in the UK, with high-end brands a top target for rural thieves. Quad-bike insurance covers your quad against theft and damage, protecting one of your most valuable assets.

Public liability insurance

While most of the land on a farm is private property, many farms also have public access and rights of way, such as footpaths and bridleways. If you have a farm shop, you may also have members of the public visiting your premises, as well as delivery drivers. If someone is hurt or their property is damaged while on your property, they may seek compensation against you. Public Liability insurance is a vital part of any insurance portfolio, as it protects you against the financial cost of a claim as well as the legal fees it may entail.

Employer’s Liability insurance

If you employ anyone on your farm, even if they are only part-time or a family member, you must have Employer’s Liability insurance. This is a legal requirement and is one of the only mandatory types of insurance (other than commercial vehicle insurance) you need.

Product Liability Insurance

The purpose of running a farm is to produce an ‘end product’, whether that’s meat, eggs, milk, or vegetables. If you sell direct to customers via a farm shop or are part of a retail supply chain, product liability protects you financially if a claim is made against you as a result of your produce causing illness or injury.

Business Interruption Insurance

A storm can bring business to a halt on a farm. Business interruption insurance protects your income if you have to stop operations because of a fire, a disease outbreak such as Foot & Mouth, or weather damage. Business interruption insurance can help keep the money coming in and the bills paid during difficult periods.

Legal and regulatory considerations for farm insurance

Farm insurance in the UK is controlled by a strict adherence to agricultural, environmental, and commercial regulations. The key considerations revolve around compliance with DEFRA rules, animal welfare law, environmental protection, and meeting the standards required by farm assurance schemes such as Red Tractor.

DEFRA sets mandatory rules for keeping livestock, protecting animal health, and managing land. Non compliance, such as reports of poor welfare or incomplete or inaccurate record-keeping, can invalidate livestock insurance claims.

Likewise, environmental compliance is a major factor in agricultural insurance risk assessment. Strict rules cover oversight of water protection, including the care and maintenance of river and stream courses, waste disposal (including slurry and non-biodegradable materials), the use of pesticides and herbicides, hedgerow management, and soil protection. Breaches of any of these, such as deliberate or even unintentional pollution incidents, can lead to heavy fines and may also void liability or farmland insurance policies.

Other legal and regulatory considerations include:

• Meeting fire safety regulations for farm buildings
• Up-to-date electrical inspections, firebreaks, or secure chemical storage systems
• Machinery and the use of equipment must comply with current Health and Safety Executive (HSE) standards

Different types of land insurance applicable to farms

It’s not just buildings, livestock, and machinery that are covered by farm insurance. The land itself is also subject to insurance, depending on its use.

For example, Agricultural Land Insurance protection includes damage to fields resulting from natural events or vandalism; boundary features such as hedges, walls, and fences; access tracks and private roads; and loss or damage to land used for crops or grazing.

Many farmers are now diversifying to keep income rolling in, and farms offering camping, glamping, and other leisure-based options need to consider specific insurance for those activities. If you allow the use of your land for events, gymkhanas, motor sports, or other activities, you will need to consider land insurance to cover them.

How much does farm insurance cost?

Farm insurance can cost as much or as little as you want to pay. Because margins can often be very slim when running a farm, you need agricultural insurance that not only gives you the confidence that your assets are protected but also works to your budget without overstretching yourself. The type of farm, its size, your location, and issues such as your current security systems, compliance with regulations governing the storage of chemicals, and accessibility will all affect your premiums.

But if things do go wrong, it’s worth considering the potential financial risk of being underinsured.

Tips for choosing the right farm insurance

With so many policies on offer, it can be challenging to choose the right insurance, especially when paperwork comes second to looking after your crops or animals. However, there are ways to make the process much easier, and there are plenty of experts who are ready and willing to help you make the right choice when it comes to insurance cover.

• Working with a specialist agricultural broker - The smartest way to ensure you’re getting the best value for money is to talk to a specialist agricultural broker who has experience working with the farming sector. Their in-depth knowledge of both the insurance sector and the farming community gives them a unique perspective on farmers' needs when choosing the right cover.
• Conducting a full asset survey – So that you have the right amount of cover, it’s important to do a full survey or inventory of all your farming assets. From farming equipment, vehicles and machinery to livestock, feed reserves, land and even the fences that form your boundaries, every element needs to be considered so you have the right level of cover.
• Bundling policies for better value – There is no ‘one-size-fits-all’ approach to creating a comprehensive insurance portfolio. You’ll need to consider individual coverage such as farmer’s car insurance for your vehicles, tractor insurance, buildings cover and many more. The most effective way to save time and money is to bundle your policies together, so rather than paying multiple premiums, you’re only paying one or two. Your insurance broker will be able to help you create a portfolio filled with the insurance you need, without trying to ‘upsell’ you coverage that you don’t want.

Common mistakes when it comes to farm insurance

With so much to think about, it can be easy to make a mistake when it comes to arranging the right farm insurance. The most common errors include:

• Under-valuing equipment – get an accurate assessment of its current market value. While depreciation will affect value over time, it may not be as drastic as you might think, especially for the ongoing value of specialist machinery such as bailers.
• Failing to secure outbuildings properly – An old, rusty padlock or a rickety door could affect the success of your insurance claim. Make sure your farm is adequately secured, preferably with CCTV and cameras covering entrances and buildings to deter thieves.
• Getting a quote for incorrect land boundaries – Over time, boundaries can shift because someone accidentally moved a fence a few metres out of alignment. When you’re organising your agriculture insurance - especially any land cover – ensure boundaries align with your official land deeds.

Do I need insurance as a tenant farmer?

Yes. All farmers need to take out insurance; you cannot assume the landlord will cover farm insurance.

What happens if walkers are injured on my land?

If a walker is injured on your land, the success of any claim for compensation will depend on whether they were on a designated footpath or trespassing on private land. However, to negate the worry of expensive legal action, it’s vital to include Public Liability insurance cover in your insurance portfolio.

Park Insurance – helping your farm grow

For over 30 years, Park Insurance has been the go-to broker for specialist insurance. Our location in the southwest of England means we have strong ties with the farming community and understand the complexities and challenges of farming. Our position as preferred brokers to some of the UK’s largest insurance providers means we can source the best-value cover, including farmers’ vehicle insurance, agricultural land cover, buildings and contents insurance, quad bike insurance, or tractor cover.

We tailor policies to your exact needs, without unnecessary extras. Use our online Get a Quote form for instant, no-obligation quotes, or contact one of our team specialising in farm insurance and let us help you put together an insurance portfolio that’s tailored to your exact needs and budget. Speak to one of our agricultural insurance specialists today.