June 30, 2021

Learn About Coverage for Harvested Grains and Produce

In Canada, crop insurance may be purchased from the federal-provincial-producer cost-shared program called AgriInsurance. This type of insurance typically protects traditional and horticultural crops from perils like drought, flood, wind, insect infestations, and excessive rain while those crops are in the ground.

Farmers also have the option to purchase insurance coverage for harvested produce, this can protect the crop after it leaves the ground and prior to sale.

Traditional Crops

When you think of traditional crops in Canada, wheat, corn, oats, and barley may come to mind. These products may be grown for livestock or human consumption and have several different names to distinguish them once matured and harvested. For those not familiar, here are a few common terms:

Fodder: Harvested grains for livestock.

Silage: Grains for livestock stored in a silo or other housing to ferment.

Threshed grain: Refers to grains that have been cut from the stalk and separated from the chaff. These grains are often for human consumption.

Standing grain: Grains which are still growing in the ground and have not been harvested.

Swathed grain: Process where green wheat, oat, or barley is cut and left in the field before it is bundled up to make hay for animals.

These agricultural terms are used by insurance companies to distinguish between crops for insurance coverage. Insurance will often cover harvested crops in bins and silos for perils like fire, explosion, and windstorm. When a claim is made, the adjuster will usually take into account the fair market value of the product for the settlement then subtract the deductible.

Claim Example

Silage in a 3,000-bushel grain bin becomes too dry, causing the grain to spontaneously combust. The fire smoulders for a few days as farm workers are unaware of the problem. It combusts further and a large fire breaks out burning the entire grain bin to the ground and setting a nearby bin on fire. The second bin is damaged and the grain inside is unsaleable. After review, the claim examiner determines there is coverage under the farm policy for the bins and the silage.

$15,000 Bins
$10,000 Silage (fair market value)
$2,500 Subtract deductible
$22,500 total settlement for the claim

Horticultural Crops

Produce like vegetables and fruits usually fall under the horticultural crop category. Whether grown inside a greenhouse or out in a field, farmers may seek

coverage for harvested, or partially harvested, produce to protect their crop.

Generally, insurance protects harvested produce when it has been sorted into a bin and when it is stored in a farm building on your property. The perils covered may differ based on where the produce is located. For example, storing harvested produce in a fully enclosed farm building or a farm building enclosed on two sides means the perils covered may differ.

Claim Example

After harvesting an entire field of carrots, the produce was stored in a three-sided farm building for the wholesaler to pick up. Nearby, a propane tank exploded and lit the wooden structure on fire. The entire harvest was damaged and unsaleable. A claim is submitted, and coverage is confirmed under the farm policy for both the building and produce.

$40,000 Farm Building
$16,000 Harvested Farm Produce
$1,000 Subtract deductible
$55,000 total settlement for the claim

With Mutual FarmPROTECT™ farmers can protect crops like fodder, silage, threshed grain, standing grain, fruits, and vegetables. Talk to your broker about available coverages to learn more!


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