March 5, 2019

Are My Farm Tools Covered Under My Insurance Policy?

Middle aged white man wearing a straw hat holding a hammer and repairing fencing on his ranch with cattle in the background

Picture this: a faulty wire in the walls of your workshop arcs causing a fire. The fire spreads quickly finding a pile of greasy rags and triggering flames that engulf the entire building. Despite firefighting efforts, the building is damaged and many of the tools used on your farm, stored within the workshop, are damaged beyond repair.

Are you confident your insurance policy will cover the loss of your farm tools?

What is a Farm Tool?

Farmers use tools every day for the general operation of their business from repairing equipment to building fences and corrals. It often means collecting a lot of tools, as you need the proper tool for the job (whatever that job is). To qualify as a “farm tool” naturally the item must be used to conduct farming on your property. This may include items such as:

  • Hand tools: screwdrivers, ratchets, wrenches, sockets, hammer, pliers
  • Power tools: chainsaw, impact driver, drills, disc grinder, miter saw, circular saw, heat guns
  • Other tools: plow, hatchet, rakes, scythe, sickle, wheelbarrow, sawhorses, work benches

Below we list some items that are not considered farm tools:

  • Electronic equipment: computers, GPS devices
  • Small vehicles: forklift, tractor, all-terrain vehicle
  • Heavy equipment: backhoe, tractor, combine

Other coverage can protect these items in the event of a loss for example farm equipment breakdown or mobile farm equipment coverage.

Things to Keep In Mind when Insuring Farm tools

When you talk to your insurance broker about coverage for your tools, there are a few things to consider…

What is the limit of insurance?

Typically, farm tools have a limited amount of coverage. This means there may be a limited dollar amount that can be approved to replace farm tools. Check with your broker to see your options.

How old are the tools?

There may be conditions on your policy for the age of the tools that are replaced in the event of a loss. For example, if your insurance contract states tools must be less than five years old, a proof of purchase with the date must be provided to the insurance company. Note that specialty tools handed down from parents or grandparents may not be covered because of their age.

Is this covered?

Become familiar with the perils (e.g. fire, theft, explosion) your tools are insured for based on your insurance policy. If you have a specific farm tool that you want to find insurance coverage for or want to confirm insurance coverage for a specific peril, mention it to your insurance broker.

Related Posts