Protecting Your Assets: Crop Insurance

This week we are talking about protecting your farm assets and insurance is tool that farmers can use to reduce risk.  However, many off-farm friends of ours do not understand that an insurable loss impacts much more than the bottom line.  Grain farmers like us can purchase insurance for natural threats such as drought, excess moisture (rainfall and flood), frost, hail, fire, excess heat, wind, wildlife, disease and pests.  But, even if insurance can cover the financial losses, having a crop failure is a huge stressor for many other reasons.  A few examples include:


  • Farmers have to look at their damaged crop for the whole growing season.  This is a daily reminder of the risky business that they are involved in and how many things are out of their control.

  • Farmers have to develop a unconventional or atypical course of action to prepare their field for the next growing season.  This can mean researching new techniques or renting or purchasing different equipment to clean up a field to return it to a production-ready state.

  • Farmers have to listen to others tell them that insurance will cover their losses, so not to worry about it.

It is hard to describe the emotions associated with an insurable loss.  Even if you know that your coverage was sufficient to replace your financial losses there are still non-financial impacts.

If you lost your family home in a fire and all of your photo albums burned, if would be insulting and hurtful for someone to say “You can always buy new photo albums.”  Of course it isn’t about the album, but about what was inside - all of the memories that it represented. You would still have the memories and you could buy new albums, but something would not be the same.  Likewise, when you lose a growing season there is something that is lost; that satisfaction of working the land and producing a crop can’t be replaced by insurance.