What to Consider When Updating Property Coverage for the Farm
October 15, 2026Farm insurance protects your investment. Property coverage is an essential type of farm insurance that provides protection for property, which includes valuable assets. However, you have to have the right coverage and enough of it in place before an incident occurs to have that protection. Here’s what to consider when updating property coverage for the farm:
- Review your peril coverage.
- Know what structures are covered and how.
- Make sure the contents of structures are also covered.
- Conduct a risk assessment when evaluating assets.
- Check how covered property is valued on your policy.
- See if you need to adjust deductibles.
1. Review Your Peril Coverage
When reviewing an insurance policy, it is essential to understand what is and is not covered by that policy. This information should be available on your policy Declarations Page. Pay attention to your peril coverage. In property insurance, there are two types of peril coverage: named perils and open perils.
Named Perils
Policies with named perils will list the perils that are covered. The perils are named specifically on the policy, and those are the perils that are covered. If a peril is not listed on a named perils policy, it is generally considered excluded from coverage. Essentially, a named perils policy will list what is included in coverage.
Open Perils
A policy with open perils provides coverage for anything that is not specifically listed as an exclusion on the policy. In this case, the perils that are named are the exclusions that do not have coverage on the policy. Essentially, an open perils policy will list what is excluded from coverage.
2. Know What Structures Are Covered and How
It’s essential that you know what structures on your farm are currently covered and how they are covered on your insurance policy. From structures to equipment, you want to make sure that anything that is important and that you cannot easily afford to replace is listed on your policy with sufficient coverage to protect it.
Depending on your current policy and coverages, you may need to add coverage or update limits to properly cover the structures on your property. This is often the case when you have built new structures on your property or have done renovations, improvements, or major additions to existing structures since your last policy renewal. Having a record of changes like these is one of the tips to prepare for your farm and ranch annual insurance review and is useful anytime you need to review coverage.
3. Make Sure Contents of Structures Are Also Covered
In addition to coverage for your structures, also check your policy to ensure that the contents of those structures are also insured properly. Losing a building can be devastating, but just insuring the structure itself is not enough to cover your losses and protect your investment.
You also need to consider the inventory and other assets you have inside those structures when you are obtaining or updating property coverage for your farm. Depending on what you are insuring inside those structures, contents may fall under business personal property insurance. Here, too, your insurance agent will be able to help you navigate the coverage you need for whatever your situation is.
4. Conduct a Risk Assessment When Evaluating Assets
When it comes to assets included in your property coverage, there are crucial assets that are essential to keeping your ag operation running, and there may also be some assets that do not need to be specifically insured.
When you are evaluating assets to determine the coverage you need and how much, conduct a risk assessment for them. Consider the following:
- How often do you need to use this item?
- What would happen if you lost this asset?
- What other effects would losing that asset have for your operation?
- Could you afford to lose the asset, or have a delay where you couldn’t use it?
- How easy is it to repair and maintain the asset?
- How expensive is it to maintain or to repair?
- How much would it cost to replace the asset, if needed?
- How easy is it to find a replacement for the asset, if you need to?
Blanket Coverage May Apply to Some Assets
For assets that are not essential or that expensive, you could decide to self-insure in those cases. There could be items that cost more to insure than they are to just pay to replace. It all depends on your situation and how much you are comfortable self-insuring from your own pocket.
Depending on the assets and your insurance coverage, there may still be some coverage available for these assets under blanket coverage for standard farm personal property or extended to them from other endorsements you have on your policy.
These are all things to consider when updating property coverage for the farm. Talking with your insurance agent is a good place to start if you’re not sure what assets require coverage or where in your policy they are covered. They’ll be able to walk you through what is and isn’t covered, and provide personalized advice on what makes sense for your situation and needs.
5. Check How Covered Property is Valued on Your Policy
Something else to consider when updating property coverage for the farm is how covered property is valued on your policy and under what limits. When insuring property, the value can be insured as actual cash value or replacement cost.
Actual Cash Value
Actual cash value insures the property for what it is actually worth at the moment. This is usually determined by using the current purchase price and subtracting value based on depreciation.
With rising costs, this can often result in situations where you have to pay a substantial amount out of pocket in order to replace an asset because the actual cash value is lower than what is needed to cover it. This may not be the case for every item, but it is something to consider with property insurance and something to work through with your insurance agent.
Replacement Cost
Replacement cost value covers the property for what it actually would cost to replace it, according to the limits of your policy. Replacement cost helps account for differences in cost between when something was originally purchased, plus depreciation over time, and what it costs to replace now.
For a lot of items, the cost to replace now is higher than the original purchase cost. Provided the limits on the policy are sufficient for the value of the item, replacement cost bridges that gap to include the higher costs associated with replacing that asset.
Depending on the assets and your current policy limits, you may need to increase limits to reflect current costs, avoid being underinsured, and ensure you will be sufficiently compensated for that asset should you need to replace it. Your insurance agent will be a valuable resource to help you navigate this.
6. See If You Need to Adjust Deductibles
Another thing to consider when updating property coverage for the farm, or when you are reviewing any of your insurance policies, is the deductible. When submitting a qualified claim, the deductible is the amount you are responsible for paying before insurance provides payment.
Deductibles are determined at the time of purchase for the policy, and they do tend to affect the premium. Often, higher deductibles result in lower premiums than lower deductibles on the same policy. Depending on the type of coverage and sometimes the peril as well, deductible amounts could vary; they could be a specific dollar amount, or they could be listed as a percentage of the insured value. The right balance for you depends on how much risk you want to take on and how much you are financially able to handle in the case of a claim.
Adding or adjusting coverage will affect your premiums. At the same time, you may also be able to qualify for new discounts or obtain cost-savings by bundling multiple insurance policies. In many cases, bundling multiple insurance policies makes sense. Your insurance agent will be able to walk you through what makes the most sense for your situation and your needs and tailor your insurance portfolio to meet them.
Get the Property Coverage Your Farm Needs With Ruhl Insurance, a Division of Horst Insurance
These are just a few things to consider when updating property coverage for the farm. Although there are some standard types of farm insurance coverage, every ag operation is unique. The types of coverage, specific endorsements, limits, and more will vary from farm to farm. You don’t want to wait until you have to file a claim to find out you are missing important coverage or don’t have sufficient coverage.
Working with an independent insurance agent with ag experience can make a big difference in making sure you have the coverage you need before you need it. They’ll be able to tailor coverage specific to your ag operation and your needs, which is a big benefit of working with an independent insurance agent.
If you need to review your farm insurance coverage or obtain new coverage, contact Ruhl Insurance, a Division of Horst Insurance, at 717-665-2283 or 800-537-6880. We can help you get the farm insurance your ag operation needs.
Disclaimer: Information and claims presented in this content are meant for informative, illustrative purposes and should not be considered legally binding.