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Why do You Need to Consider Buying Farm Insurance for Your Hobby Farm?

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hobby farmIt’s commonly believed that if you have a hobby farm which is just your hobby and doesn’t earn you any income, you don’t need farm insurance. But the fact is that farming, whether it is commercial or hobby, is a dangerous affair, where you typically require equipment and animals that can be dangerous being unpredictable. And hence farm insurance is essential even if you have a hobby farm.

The type and amount of cover you’ll need will be based on your farming activities. Sometimes, hobby farms are covered under a homeowner’s insurance policy. However, this may not be true in your case, so, you will have to check it. Thus whether you perform farming tasks as a small side business or your farm is a full-fledged business, it probably requires farm insurance.

playing with baby animals

What is Hobby Farm Insurance?

Hobby farm insurance is different from standard farm insurance because hobby farms are small-sized farms that are operated mainly for pleasure instead of profit. Hobby farm insurance is a specialised insurance policy covering the particular risks in this niche.

Type of Insurance Required for a Hobby Farm

Finding the appropriate insurance cover can be a complex task. The exact amount and type of coverage required can be determined by the particular scenarios on your farm, e.g. its size and what it is used for.

What can You Use Your Hobby Farm for?

You can use your hobby farm purely for your own pleasure or use it in various ways to earn an additional income. In both the cases, you always have risks of theft, natural disasters and other such perils for which you’ll need hobby farm insurance.

Here are a few scenarios you can make use of your hobby farm for and associated risks you may have.

Selling Produce in Farmers Markets

This is the first and most obvious source of income you may consider while planning to develop a hobby farm. This is a great way to use your farm because farmers’ markets are getting increasingly popular across Australia, especially suburbs where people are interested to know how food is produced and purchasing locally, and have high disposable revenues and wish to pay for quality. You will need insurance here to safeguard your plants as well as the automobiles in which you will transport your produce towards the market.

farmers market

Tourism

Agritourism or the combination of agriculture and tourism is increasingly getting popular and is an excellent opportunity for hobby farmers to earn some extra cash. Stressed out city dwellers as well as international tourists can take benefit of your farm to spend a relaxed holiday in a pastoral environment and you can make arrangements for their comfortable stay and food on your hobby farm. The tourists would love farmhouses or cottages that you can offer along with the delicious breakfasts and meals made from fresh, organic, farm-grown produce. They can even enjoy feeding farm animals, playing with their babies, horse riding, picking flowers and fruits, or simply use your farm as a base while exploring the surrounding areas.

feeding farm animals

In this case, the most important thing to care about is your guests’ safety. You will need insurance that will cover any injury caused to them. You’ll also have to consider insuring the accommodations you’ll provide them, the animals and the trees, so that if any harm caused to them by your property or belongings can be covered by your farm insurance. If you are going to offer horse-riding on your farm, you can even have equestrian insurance which is a product offered by farm insurance companies.

horse riding

Growing Niche Products

If you consider growing produce on your hobby farm for selling them commercially, you can do it on a small scale, but you can hardly compete with the commercial tycoons in this business. In that case, you can grow niche products that have a high demand but are not catered by large farming businesses. Some great examples of these are raising free range pigs or goats, heirloom vegetable growing and seed production, duck eggs, yabbie or marron farming and raising fancy chickens for pets. Here too you’ll have to take care of the associated risk and seek insurance coverage for the animals and plants against any disease or natural disaster.

ducks and chickens

Selling Farm Byproducts

Farming can not only give you core products but numerous byproducts which you can sell commercially and make some extra money. You can produce organic manure from the farm animals’ waste, dry leaves and other plant products, etc. and sell it to private and commercial gardeners to improve their soil quality. You can even have a worm farm and sell “worm wee” or worm castings. Here too you will need to get insurance coverage for your animals and plants.

Things Covered

A typical hobby farm insurance cover may include:

Building and its Contents: Protection to owner occupied as well as tenanted houses, including reinstatement protection for constructions and contents after unforeseen events like theft, water damage and fire.

Other Constructions on Farm: Protection to grain storages, work buildings and constructions like workshops and sheds. There may be protection to the contents of these buildings too.

Farm Fencing: Protection to your farm fencing in case of damage resulted from fire, extreme weather or any other disaster.

Farm Machinery and Automobiles: Protection to your farm machinery and business automobiles that are used on your hobby farm.

Farm Liability Insurance: Cover for any personal injury and/or property damage to a third party resulted from your hobby farm tasks.

Farm Business Interruption: Cover for a loss of revenue after a claim for damage.

Selecting just an appropriate hobby farm insurance cover can be daunting. In that case, an insurance broker can be of help to make you aware of available options and suggest you the best one for your particular hobby farm insurance requirements.

farm vehicle

Cost

The cost of hobby farm insurance depends on several variables, such as:

  • Location of your hobby farm
  • Size of your hobby farm
  • Type of activities you carry out on your farm
  • Your financial history
  • Turnover of your farm business

fruit picking

Every insurance policy comes with terms and conditions which you should go through carefully and also you will have to give your information needed by the insurance company in order to start the policy.

Protection you’ll obtain will vary depending on particular clauses in the policy. You can ask your broker to explain you if there are any additional benefits and exclusions and try to take maximum benefit of your hobby farm insurance policy.

 

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