Post-harvest is time for producers to review liability insurance coverage

Insurance Policy

Post-harvest is a good time for producers to review their liability insurance coverage, says University of Missouri economist Ray Massey.

Recent issues with dicamba spray drift highlight the need for farmers to understand their third-party liability due to herbicide applications, Massey says.

Massey recommends that farmers consult with an insurance or legal professional experienced in agricultural matters after reviewing their policy.

Crop insurance does not cover damage from pesticide drift, according to the crop insurance manual of the U.S. Department of Agriculture’s Risk Management Agency. However, USDA allows farmers to exclude yield from damaged acres in their actual production history numbers if they report damages to their insurer within 72 hours.

General liability insurance may or may not help with third-party herbicide injury, Massey says.

Insurance companies carefully consider the cause of loss in cases of herbicide injury, he says. Third-party herbicide injury causes include spray tank contamination, drift, and volatilization. Liability insurance generally covers accidental tank contamination and drift, but it is less clear whether damage caused by volatility is covered.

Liability insurance companies usually wait until after harvest to settle an approved claim so they can estimate yield loss. They do this because yield loss may result from other factors, such as weather, Massey says.

Massey offers these tips:

• Verify that your applicator is certified to apply the pesticide being used. Check the applicator’s license. If you spray your own crops, take the required training for certification.

• Review your farm’s policies and procedures for spraying decisions.

• Review your application for general liability insurance. Update your application if you have made any changes in your farm operation since applying. This includes hiring an employee.

• If you spray your own fields, verify that you have a spray endorsement provision in your policy. If you spray for others, verify that your endorsement covers commercial and private applications.