As an Alberta farmer, you know farm outbuilding insurance is vital to your daily operations. From barns to equipment shelters, these structures are essential for your farming infrastructure.
Imagine the devastation caused by a fire, storm, or other disasters that could damage physical structures and result in significant losses to your valuable assets.
A tailored insurance policy from MMI Insurance Company gives you the peace of mind of knowing your farm outbuildings are adequately protected, allowing you to focus on the core aspects of your agricultural operations without the burden of financial uncertainties.
Insurance to Value
A farm insurance policy relies on accurate asset values for fair premiums. The limit of insurance on the policy needs to be sufficient to cover the cost of replacing property which has been lost, damaged or destroyed in its entirety. Items that need to be included in the value to rebuild the building include the cost of demolition, debris removal, changes to building codes, cost of permits, architect and engineering fees, and the current cost of construction (i.e. labor and materials). Undervaluing assets may seem cost-effective initially, but it puts both parties at a disadvantage. For instance, if a barn worth $100,000 is insured at $60,000, expecting a payout based on the actual replacement cost will not meet the co-insurance requirement on your policy and you will be subject to a co–insurance penalty.
Understanding Your Co-insurance Clause
If the co-insurance requirement on your insurance policy is 80%, it means that at the time of loss, the declared value (limit of insurance on your farm outbuildings) must be no less than 80% of the replacement cost of that building. Failure to comply with this requirement will result in a “co-insurance” penalty (you will be required to share in the loss to the same portion that you are under insured.
Co-insurance typically applies to outbuildings, maintaining fairness in the insurance arrangement.
Farm Outbuildings vs. Residential Structures
Farm outbuildings refer to structures on agricultural properties used for various purposes, such as storing equipment, housing livestock, or sheltering crops. In contrast, residential structures, such as houses, cabins, rented dwellings or other habitable spaces, are dwellings where individuals live.
Farm outbuildings are typically larger and serve agricultural functions, while residential structures are designed specifically for human habitation.
Farm outbuildings are valued based on construction materials, size, cost of demolition, debris removal, changes to building codes, cost of permits, architect and engineering fees, labor and functionality. Proper valuation ensures adequate insurance coverage for these essential assets.
Types of Farm Outbuildings We Insure
At MMI Insurance, our farm outbuildings’ insurance covers a variety of structures crucial to your agricultural operations. Please note that the following list is not exhaustive. Contact us to discuss insurance options for all your farm outbuilding needs.
Garages, Implement Sheds, Repair Shops, Quonsets
Our coverage ensures your equipment and vehicles are safeguarded, minimizing disruptions to farm operations due to damage or theft.
Cattle Barns, Stables, Livestock Shelters
Farm outbuilding insurance protects your livestock housing, providing financial support for repairs or replacements in case of structural damage or other unforeseen events.
Granaries, Grain Elevators, Storage Barns and Silos
Protect your grain storage facilities, ensuring your harvest remains safe from risks such as fire, vandalism, or natural disasters.
Feed Mills
We provide insurance coverage that ensures uninterrupted feed production, helping you recover quickly from equipment breakdowns or other covered losses and ensuring a consistent feed supply for your livestock.
Other types of farm outbuildings we insure include:
- Seed Cleaning Plants
- Pole Barns, Hay Sheds
- Apiaries
At MMI Insurance, we tailor farm insurance policies to your specific operations, whether you’re in grains, ranching, fruit and hay, mixed-use, or seed. We provide comprehensive coverage so you can navigate the challenges of farming with confidence, knowing that you are covered properly.
Risks to Farm Outbuildings
Your farm buildings face various risks that can significantly impact your insurance needs. From natural disasters to equipment failure, understanding these risks is crucial for comprehensive coverage.
