Breaking Down Equipment Breakdown for Farm Insurance Policies
Operating a modern, commercial agricultural business means investing in the necessary equipment to operate. From 10 acres to 1,000 acres, there’s an exhaustive list of devices, vehicles, equipment, and technology you use to operate your farm. Minimize downtime and save yourself the hassle of hiring to repair mechanical, electrical, and pressure systems by choosing to add farm equipment breakdown coverage to your insurance policy.
Many insurance policies limit or exclude equipment breakdown so adding this enhancement to your farm policy is a good way to protect your investment in farm equipment.
You can check the limit of coverage (the amount you are insured up to in the event of an equipment breakdown) by checking your policy coverage summary and wordings. In the event that you have a claim, you will need to pay your deductible. However, if the only coverage being used is the Farm Equipment Breakdown coverage, there is no loss of claims-free discount.
Just what exactly is an equipment breakdown? It is defined as physical loss or damage originating within mechanical, electrical, electronic, or boilers and other vessels normally subject to vacuum or internal pressure.
We’ll break down each type below.
Note, examples are just an illustration to show different types of claims. Each claim received by Mutual Fire Insurance is adjusted individually with coverage to be determined based on your unique claim.
Mechanical Equipment Breakdown
When equipment has moving parts that fail to operate, it is considered a mechanical breakdown.
The exhaust fan in the poultry house mechanically seized due to lack of lubrication. An alarm system alerted the operator to the problem and a temporary fan was brought in before losing fowl. Total property damage covered was $3,500 plus an extra expense of $800.
Electrical or Electronic
Wiring and fibre optics running through farm machinery can break down due to a power surge or a single phasing event (that’s when the lights flicker or only some lights go out). Another cause for electrical breakdown is an arcing occurrence between wires.
A severe voltage spike damaged the windings in a 50hp feed water pump motor. The motor could not be repaired due to the extensive electrical damage and was replaced. Total property damage covered was $5,575.
Any equipment under pressure that fails to operate due to a rupture, bursting, bulging, implosion, or steam explosion.
The 300hp irrigation pump seized due to low water conditions. Repair parts were obtained and shipped overnight. The costs to the property were $15,025 and an expediting expense of $1,200 was included.
Types of Farm Machinery
For the purposes of farm equipment breakdown, mobile farm machinery and equipment includes any land motor vehicle and attachments designed for use on or off public roads. Additional examples of property covered include:
- Air Conditioning Units
- Automatic waterers
- Boiler and Pressure Vessels
- Circuit breaker panels
- Computer Controlled Equipment
- Computerized feeding systems
- Electrical Systems
- GPS Equipment
- Heating and cooling systems
- Heating Units
- Irrigation Systems
- Milking parlors and collection equipment
- Refrigeration compressors
- Refrigeration Units
- Silo unloaders
- Well/Water pumps
Ultimately, farm machinery is meant to be used. With use comes natural wear and tear to the equipment and all machinery has a life expectancy. This wear and tear is not covered through farm equipment breakdown.
Talk with your insurance broker to see if farm equipment breakdown is the right coverage for you.