Running a farm involves managing a wide range of risks—from unpredictable weather to equipment failure and livestock loss. While most farmers carry insurance, some are surprised to discover gaps in their cover when it comes time to make a claim. These oversights can result in financial stress or even the inability to recover from a major setback.
In this post, we’ll look at common gaps in farm insurance policies, what you can do to mitigate risk, and how the right cover can give you peace of mind.
Why hidden gaps occur
Farm insurance policies are often complex, with multiple components covering property, machinery, vehicles, livestock, crops, and liability. Over time, as your farm changes—new equipment, expanded operations, or increased livestock numbers—your insurance may not automatically keep pace.
Gaps can also emerge from assumptions. Many farmers believe certain things are “automatically included,” when in fact, specific items or circumstances require separate cover.
Common gaps in farm insurance
Here are some of the most frequent areas where we see cover fall short:
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Undervalued equipment or assets: Machinery and buildings may be insured for less than their current replacement cost, leaving a significant shortfall after a loss.
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Unlisted improvements: Sheds, silos, or extensions added over the years may not be listed on your policy.
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Off-property liability: If your stock stray onto a road or someone is injured by your farming activities away from your land, you may not be covered without the right liability extension.
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Agistment arrangements: Livestock on your property that belong to someone else—or vice versa—can create uncertainty if they’re not declared or insured correctly.
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Working dogs: Many policies exclude working dogs or place tight limits on claims. Without proper cover, replacing a valuable working dog could be expensive.
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Crop cover: Not all policies include hail, fire, or frost protection as standard. These need to be discussed and added where needed.
Risk mitigation strategies
While insurance is essential, reducing your exposure to risk in the first place is just as important. Here are some ways to protect your operation:
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Keep asset registers up to date, including photos, serial numbers, and current values.
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Maintain and inspect machinery regularly, and keep service records.
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Use fences, signage, and other controls to prevent livestock straying or unauthorised access.
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Formalise agistment agreements, so responsibilities and liabilities are clear.
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Review your cover annually, especially after any major purchase, expansion, or change to operations.
The role of insurance
Insurance exists to transfer the financial risk of unexpected events, helping you recover and rebuild without putting your future on the line. But it only works if the policy accurately reflects your current situation.
At Western General, we often come across farmers who’ve been with the same insurer for years without reviewing their policy. While loyalty is a good thing, it’s important to ensure your insurance is working as hard as you are.
A comprehensive review can identify:
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Areas where you’re underinsured or uninsured
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Duplication of cover
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Opportunities to reduce premiums without sacrificing protection
A proactive approach is best
The best time to identify gaps in your insurance is before you need to make a claim. Having the right conversations with a qualified broker can save you heartache and stress down the track. At Western General Insurance Brokers, we specialise in supporting farmers across Horsham and regional Victoria. We take the time to understand your operation and ensure your insurance keeps up with your needs. Contact us for a free, no obligation discussion about your needs.
The information in this article is of a general nature only and has been prepared without taking into account your individual objectives, financial situation or needs. You should consider whether the information is appropriate for you and consult a qualified insurance adviser before making any decisions regarding insurance products.