Texas Ranch Sales SOAR due to pandemic. Here's what you need to know when insuring yours.
More than half a million acres of rural land traded hands in Texas last year, hitting a record $1.69 billion worth of deals according to Texas A&M University Real Estate Research Center. And it's not stopping, sales are expected to continue to soar in 2021. Investors and rancher enthusiasts want a look at the big Texas sky from the privacy of their own 10,000 acre ranch. If you too just went all Yellowstone and bought a ranch you're going to need to know a little something about insuring it.
What does farm and ranch insurance cover?
Rural property insurance, also known as Farm and Ranch Insurance, can range from basic policies similar to homeowners insurance, all the way to policies designed to cover your farm equipment, machinery, and even livestock. Because farms and ranches are usually a unique blend of personal and commercial property, insurance policies need to be flexible in terms of what they offer. In general, farm and ranch property insurance can be broken down into two main categories.
Rural property insurance: Covering your home on the range
Home or dwelling. This policy works in a similar fashion to a standard homeowners insurance policy and is designed to cover your rural home, ranch house, or perhaps a barndominium. Just like home insurance, it generally covers losses due to things like fires, storms, hail, and so on. Other structures and outbuildings. With room to spare, it's not uncommon for rural homes to include several buildings apart from the main living structure. This might include workshops, detached garages, or even stables. However, it's important to note that this typically does not cover buildings intended for commercial use.
Covering your farm or ranch equipment and operations
Farm machinery and equipment. Coverage in this category protects the equipment and machinery you rely on to run your farm or ranch. This may include tractors, combines, shredders, plows, hay balers, cotton strippers, hay cutters, farm trailers, and more. Depending on the insurance company and specific policy, this may include vehicles (like a pickup truck) used for farm work. However, in some cases, this might fall under a separate commercial or business auto policy. Farm products. When it comes to insurance policies, there is usually a distinction drawn between crops and products. Grain, hay, seeds, and other field products may be covered, but only once they are harvested and stored. Once planted, crops usually require a separate commercial policy. Livestock. If you raise animals, such as cattle, many farm and ranch insurance policies provide coverage to protect you in the event that they are injured or killed. While livestock are susceptible to many of the same dangers as your equipment (such as tornadoes), they also present a unique set of risks (like being attacked by wild animals). Some insurance companies include these perils in their standard offerings, yet others may place those in separate, additional policies. Policies are also available for horses, or other equine animals (like a mule, for example). However, the type of coverage you'll need depends on how you use that animal. For example, if you use a horse to check fences or herd other livestock, the necessary coverage may differ from if you used your horse for show purposes or recreation. Other agricultural structures. Typically, policies that cover your house, or any personal property, will not cover structures or buildings with commercial use. If you have a barn, stable, grain silo, or workshop that you use to produce agricultural products, you'll need to inquire about this additional type of coverage.
Farm and ranch liability insurance
If you've ever owned or operated a farm or ranch, you know that there is a wide range of risks unique to the practice. Animals are unpredictable at times and can sometimes escape, potentially causing damage to people and property in the process. Farming also comes with its own dangers, especially when large machinery is involved. That's why there is often a liability component to farm and ranch insurance. Similar to the liability that comes with many homeowners insurance plans, it covers things like bodily injury, medical expenses, and damage to property. Liability coverage may be part of or otherwise packaged with your farm and ranch property insurance, or may be sold as a separate policy. The type of liability insurance you'll need for your farm or ranch depends largely on the size of your operation, the type of ranching or farming you do, and whether or not your farm or ranch is run for business purposes or personal use.
It's important to understand that there really isn't such a thing as a "standard" farm and ranch insurance policy. As we have discussed, there is a wide range of different policies and coverages simply because farms and ranches have so many different functions. Depending on the insurance company, the coverages and policies we've discussed may come as a single bundled package, or may be available separately. At the end of the day, your insurance agent is going to be your greatest resource for crafting a policy that fits with your work and lifestyle. They understand what sorts of losses and perils their policies protect against, and may even conduct an on-site inspection to help determine the product that is right for you.
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4 Questions to Determine Where to Keep Your Valuables
It's important to keep your important documents and valuables away from burglars, fire, or natural disasters. Here are the four questions you need to ask when deciding whether to store them at home in a safe or in a deposit box.
How VALUABLE are your items? If your items are not replaceable or very valuable, like expensive jewelry or important documents, you'll want to keep them in a bank safe. If they are not as valuable or easily replaceable, an in-home safe will most likely be a sufficient solution.
How OFTEN do you need this item? If you're using the items, like fine jewelry, on a special occasion, a bank safe will work well. However, if it's an item you use daily or once a week, a bank safe will be inconvenient so an in-home safe is a better idea.
How LONG will you be away from your home? If you are bicoastal or gone from your home seasonally, using a bank safe for your valuables is a safer option.
How SECURE is your in-home safe? If you have an in-home safe, make sure it has a tool or torch resistant rating of 30 minutes or more (TL-30/TR-30), is too heavy for someone to carry or is bolted to the floor or other home structure.
Reach out to our team if you have any questions about how we can help you insure valuables that aren't covered by your home policy.
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Wondering what your policy covers and if your properly covered in case of a disaster? Call us at 512-447-7773, email us at firstname.lastname@example.org or reach out to your dedicated agent.