Our office has been receiving inquiries this week regarding loss of farm income coverage for Avian Influenza. We wanted to get some information out regarding this topic as we know it is time sensitive and important.
Most standard farmowners insurance policies do not carry loss of income coverage for the peril of Avian Influenza (or other transmitted diseases). The loss of income coverage that many of our clients do have on their policies is an important coverage, but it requires that there is a covered peril to the property insured on the policy (for example, the loss of a building due to a fire or tornado).
For our Ohio clients, we have NOT found any insurers who are writing coverage. We have been informed that some livestock protection agents or crop insurance agents may have access to a Whole Farm Revenue Protection product, but for contract growers, the contract is an important factor to determine coverage eligibility. If you need a referral to a livestock protection agent that can speak to this product, Sydney Kremer who used to work for our agency is licensed to take care of these needs.
For our Indiana clients, there is a potential option for farmers who are concerned about the loss of income from Avian Influenza. If you are interested, give us a call. Here are a few things you should know:
Policies can be issued for Broilers, Pullets, Turkeys as well as Breeders and Egg Layers. However, note that the premium rates are different for each category.
For states where Avian Influenza has already been detected, there is a 45-day waiting period from application before the policy will take effect.
Applications can be submitted in our office. They must go through underwriting before the application is accepted. This could take up to 48 hours.
The loss of income policy for Avian Influenza will pay for loss of income sustained during the down time. It will not pay to replace the birds.
The carrier defines the business income as; A.) Net Income (net profit or loss before income taxes) that would have been earned and incurred; and
Continuing normal operating expenses incurred, including payroll.
Policies must be paid in full and are fully-earned. This means that if an insured cancels the policy mid-term, no premium will be refunded.
The following parameters must be met before coverage can be considered:
There must be an outbreak and detection of high pathogenic avian influenza; and
Where the USDA or equivalent Governmental authority impose stringent restrictions on entering or leaving premises, area, or region where highly pathogenic avian influenza exists or is suspected; and
Your farm location has been ordered by the USDA or equivalent Governmental authority to destroy your flock and there must be a positive confirmed case at the insured farm location.
While we know farmers are doing everything possible to minimize the risk of infection, we appreciate being able to offer an extra piece of mind to our clients during this stressful time.
NOTE: Our agents always use caution when visiting farms to minimize the spread of diseases. We avoid going to more than one farm in a day in typical situations and are now trying to minimize our farm visits even further during this time.