The Best Time to Review Your Insurance Policies
An insurance policy is only useful if it covers what you actually have. Here is when to review yours, what to look at and the questions to put to your agent.
Why review insurance on a schedule?
Farms change. Herds grow, buildings go up, equipment gets replaced, and costs rise. A policy written years ago may no longer fit. A scheduled review prevents the nasty surprise of finding a gap after a loss.
This is general education, not insurance, legal or financial advice. Your licensed agent can advise on your own situation.
Do not forget the human side. Insurance conversations are boring until a barn burns, so a short annual ritual with coffee and an agent is cheap protection.
When are the best moments?
Review before each renewal, after major purchases or construction, when you change operations such as adding a herd or a new enterprise, and after any claim. Many people choose a quiet month on the calendar and tie it to loan reviews.
If you grow forage, crop insurance dates are set by the agency, so confirm them with the USDA Risk Management Agency and your agent.
Never let a policy lapse because you forgot to look at it. Set a reminder well before the renewal date.
- Before each renewal
- After buying equipment or building
- When adding animals or enterprises
- After a claim or near miss
What coverage types should you look at?
Think in categories: property and buildings, equipment, livestock, liability, workers' compensation where required, vehicles, business interruption and crop coverage. Each has limits, exclusions and deductibles.
Read the exclusions closely. Ask your agent to explain disease, weather and equipment breakdown, and ask what is not covered.
For a dairy, think about what happens if the parlor or milk house is down for a month. Ask whether policies cover lost income, temporary equipment and extra hauling costs, and read what the policy says about waiting periods.
- Property, buildings and equipment
- Livestock and business interruption
- Liability and workers' compensation
- Vehicles and crop coverage
What should you compare between policies?
Compare limits, deductibles, valuation method (replacement cost versus depreciated value), exclusions, claim process and the agent's responsiveness. The cheapest policy is not always the best if it leaves a gap.
Check the financial strength of the insurer and the agent's licensing through the Texas Department of Agriculture for ag programs and your state insurance regulator for insurance questions. For federal programs see the USDA and FSA.
Ask the agent to list three claims they have seen on farms like yours and how those were handled. Their answers tell you how they work when it counts.
Ask about discounts for bundling, safety upgrades and claims-free years, but weigh them against coverage quality.
How do lenders and insurance connect?
Lenders usually require certain coverage and want proof of it. Talk to your lender before changing a policy, so you do not break a covenant. Basics on borrowing and records are at this farm money guide.
Keep an up-to-date list of assets with values, serial numbers and photographs. It speeds claims.
If you lease land or buildings, check what the lease requires you to carry. Gaps between lease terms and your policy are a common surprise.
Ask your lender whether they want to be listed on policies and how quickly they need proof after a change, since timing matters when a loan is open.
What about safety and risk reduction?
Insurance pays after the fact. Safety and maintenance prevent losses. Fire prevention, electrical checks, safe equipment and trained workers lower risk. See this farm safety resource and OSHA for general workplace guidance. Some insurers offer premium credits for safety steps, so ask.
Weather risk also matters, so check forecasts at the National Weather Service and plan storm preparations.
Keep copies of policies in a place you can reach if the office burns, such as a cloud folder or a safe at home.
How do you make the review routine?
Write a one-page checklist, schedule an annual meeting with your agent and keep notes on every change. Use the same time each year.
For a lighter read, farm.FM has farm economics and agribusiness and farm satire, plus a farm.FM item on farm insurance.
Review again whenever you add people, because workers' compensation and liability needs change with headcount.
Keep a written log of each review: date, who attended, what changed and what questions remain open.
Sources and further reading
- USDA Risk Management Agency: crop insurance
- USDA: U.S. Department of Agriculture
- USDA Farm Service Agency: FSA farm programs and loans
- Texas Department of Agriculture: state agriculture agency
- OSHA: workplace safety
- National Weather Service: forecasts and warnings
Ask locally: Ask your licensed insurance agent to review your coverage line by line each year.