Spring Lambs

Lamb production forecast to rise

Spring LambsLamb production is forecast to rise by 4% in 2015, have you increased your flock size in the last 12 months?  You may need to look at your sums insured both for breeding stock and lamb sales.

With lambing well underway we see fields full of lambs out enjoying the sunshine which is such a lovely sight.

Photo: Taken by Georgie Spencer in Buckinghamshire (02/04/2015)

 

Contract Farming Insurance advice in Farmers Weekliy

Distinction between contract farming and contracting

Insurers must understand the distinction between contract farming and contracting

Contract Farming Insurance advice in Farmers WeekliyQI have just taken on 300 acres of contract farming for a neighbour. This is my first contract farming agreement, is there anything I need to do from an insurance perspective?

Written by: Nigel Wellings, founding director, Farmers & Mercantile. First published in Farmers Weekly 27th March 2015

AThe scenario of taking on contract farming or share farming is something we have all become very familiar with over the last 20 years or more. Unfortunately, insurers do not fully understand how this works and whether the level of risk compared to farming your own land or farming land for others differs.

Your broker should be explaining to insurers that the risk on the contract farmed area is no different to the risk on your own land. As soon as insurers hear the term “agricultural contractor” they assume an increase in risk, assuming that an agricultural contractor is carrying out individual operations, i.e. mowing, silaging, baling, combining, etc. on lots of different farms for many different people. This type of traditional agricultural contract does tend to lead to more risk as the operators are often on land unknown to them with huge time pressures to get the job done which can result in more claims.

When it is explained to insurers that contract and/or share farmers are operating on the same land year on year, and often have an interest in the crops being grown in terms of a profit share, then insurers should be willing to rate the premium for the additional land on the same basis as your existing land. The address of the new farm will need to be noted on the insurance schedule and the additional area of land added to your public liability cover. Your business interruption cover will also need extending to take account of the turnover generated from contract farming.

Insurance of the crops being grown will need to be looked at carefully if you are providing drying and storage for them. Depending on the type of contract farming agreement this can be arranged on your own policy or on the policy of the crop owner.

The most important point is that insurers are classing you as a contract farmer and not an agricultural contractor. One further point to be aware of is that if you become involved in advising on usage of chemicals and fertiliser, and/or completing the Basic Payment Scheme application on behalf of the landowner, public liability cover for your farming business will not cover you for the liability for giving advice. To cover against negligent advice you will need a separate professional indemnity insurance policy.

Burning Loadall

What is a Material Fact?

Burning LoadallA material fact is information that would to a reasonable person be relevant when making a decision. In other words, it is a fact that if concealed could reasonably have resulted in a different decision being made.

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What are the most likely reasons a claim would not be paid?

Burning Barn

1. Non-disclosure – where insurers were not informed of both current and previous insurance related information.

2. You were simply not covered. Two or 3 hours a year to make sure that you and your broker have discussed and agreed cover is something that our clients know to be time well spent.

At the end of the day it’s about the service and advice. You could be paying too much or too little; quite frankly however neither of those facts will help you in the event of a claim. If the advice and the cover you receive are not right the premium you paid becomes irrelevant.

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Is being under or over Insured a problem?

Burning CASEUnder-insurance means that in the event of a claim only a percentage may be paid out because the insurer’s premium was based on a sum insured that doesn’t match the true value at risk. It is very important to set accurate replacement values on assets; however this is not always simple and you may require expert advice from a valuation professional with regard to listed buildings and difficult to value contents. Price volatility causes huge swings in the price of cereals, oilseeds, beef, lamb, fertiliser etc. and it is essential that your insurance adviser has knowledge of these commodity prices in order to advise you.

Over-insurance is a waste of money; it means you pay for cover that is not required. It is therefore important to set accurate replacement values on assets.

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What is Full Disclosure?

Combine DustFull disclosure is the provision of material facts that are complete and accurate. The insurer will look at these facts and base their decision as to whether or not to offer cover and at what premium value. If it is found that full disclosure has not been made all cover may be deemed null and void and it may not be possible for cover to be obtained elsewhere. Insurers are well within their rights to ‘throw out’ a claim if relevant information was not disclosed to them at either the presentation stage, inception or during the term of the contract/policy. For example: changes in business activity, changes in a tenants’ activity, a prosecution or conviction since last renewal.

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Why farm insurance is best placed with Farmers & Mercantile?

Ask F&M staff “Why farm insurance is best placed with Farmers & Mercantile?” and this is what they say;

“Because the best risks deserve the best rates…”

Tom

“Because we care.”

Maggie in Ludlow

“Because expertise and specialist advice come as standard.”

Tim

“Because as a client you will benefit from specialist brokers with wide farming and insurance experience. Farmers & Mercantile provide cost effective and thorough solutions through insurers who deliver at the point of a claim. Farmers & Mercantile make sure insurance works for you!”

Ed

“Price, Service and Cover, F&M staff seek the best cover for the most competitive premium and advise the policyholder the best way in which to insure the farming business. All of the staff are very knowledgeable in both farming and insurance which makes dealing with them all the smoother, the personal service is very important dealing with the same people all the time not a call centre and having an annual on farm review to discuss any changes, check sums insured and discuss additional cover available in the market.”

Georgie

“Because….. with our face to face and tailored approach to providing a competitive service for our clients, we always go the extra mile, ensuring our clients’ needs are met and often exceeded.”

Erica

“………you can always be assured of our expertise from staff who go that extra mile.

Sue in Claims

“Because we may not be the cheapest but we are the best and always put you first.”

Anna

“Because I don’t trust my family and my livelihood to be protected by just anyone.”

Matt

“Because you can trust us to provide appropriate Insurance at the right price, but importantly deal with your problems as if they were our own.”

Richard

“We are not just Brokers who deal in Farm Insurance; we are Farmers who excel at Broking.”

Sharon

“Insuring your farm is what F & M do best. Isn’t it time you put us to the test?”

Sue in underwriting

“Because we are farmer friendly, thoroughly understand farming and its challenges, protecting a business as though it were our own. Total protection at sensible premiums.”

Keith

“You are safe in the knowledge that all your insurance requirements are dealt with by professionals who understand your business needs.”

Barbara

“Because we give you a local service from people who know about farming.”

Helen