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As more and more individuals turn towards healthier, organically produced food, hobby farming has seen a significant rise in popularity. Often viewed as a beneficial pastime that can potentially supplement one's income, hobby farming, unfortunately, does not fall under the protection of standard business or home insurance policies. For such scenarios, incidental farming coverage is incorporated into the policy. Keep reading as we delve deeper into what this insurance coverage involves, particularly within the context of Kansas businesses. Demystifying Incidental Farming Coverage Incidental farming coverage provides a safety net for any farming operations taking place on or around your insured location. With hobby farming or similar activities not included in other policies, compensation for damages or injuries incurred during these activities is not provided. For a clearer understanding, let's consider an example: Mr. and Mrs. Smith own a spacious country house where they maintain a small farm for personal use. Their property is insured under a standard homeowner's policy. While the farm is not their primary income source, they manage it as a recreational activity. As time goes on, their harvest grows, prompting them to sell their excess produce at a local farmer's market. They also accommodate a friend's horse in their barn for a modest fee. The number of chickens on their farm multiplies over time, leading to the sale of surplus eggs. They've even invested in farming equipment and machinery to aid their efforts. Mrs. Smith, a passionate baker, occasionally sets up a dessert stand nearby. As their operations expand, they often welcome people to visit their country home and sample their farm's produce without any charge. However, they fail to inform their insurance agent about the farm and business operating on their property, which exposes them to considerable potential losses. The primary question here is whether their operations could be classified as a full-fledged farm. Given the Smiths sell produce, levy a fee for horse accommodation, own farm equipment, welcome visitors, and operate a stall, they indeed run a farm, even if their primary income is sourced elsewhere. They even file Schedule F on their taxes, further confirming their farming operations. Now, let's examine how incidental farming coverage could aid this family in mitigating losses sustained both on and off their insured premises. Incidental Farming Coverage on Insured Premises Despite not charging visitors for their hobby farm experience, an accident occurs on their property resulting in a visitor's injury. Their homeowner policy makes no provision for compensation in such an event, leaving them to shoulder the medical expenses. Lack of disclosure about this activity to their insurer and the subsequent exclusion of this activity from their policy forces them to bear a substantial cost when they are sued for the injury. This unfortunate situation could have been avoided if they had chosen to include incidental farming coverage in their policy as their operations expanded. Declaring all activities occurring on your premises is critical; a failure to do so will deny you coverage for related damages or losses. Incidental Farming Coverage Off Insured Premises In another scenario, Mrs. Smith transports their produce to the local farmer's market. Tragically, a sudden storm causes her vehicle to break down, and their produce spoils before it can be sold. Fortunately, the Smiths had learned from their previous oversight and updated their policy to include incidental farming coverage. This coverage includes produce stored away from the insured premises, whether nearby or at another specified location. In such instances, coverage also applies to mobile machinery unless it is insured separately. If the incidental farming coverage specifies the particular mobile machinery, the damage is covered by the policy, providing peace of mind for potential incidents. Understanding ISO HO 24 72 and ISO HO 24 73 While the homeowner policy does not cover farming or related business activities, endorsements like ISO HO 24 72 and ISO HO 24 73 can modify it. ISO HO 24 72 covers Incidental Farming Personal Liability, which is particularly useful for those engaging in hobby farming. It extends to various liability coverage, provided all farming or business activities on the premises are declared. Failing to do so means the insurer is not obliged to pay compensation for damages incurred through the undeclared activity. ISO HO 24 73 offers Farmers Personal Liability Insurance, protecting those genuinely engaged in hobby farming and managing a small farm. However, the same repercussions of ISO HO 24 72 apply if you neglect to declare a farming or business activity. Conclusion The importance of incidental farming coverage becomes clear when you disclose all farming or business activities involved. What might appear as harmless hobby farming can lead to significant damages or losses, as illustrated in the scenarios above. Therefore, it's crucial to extend your homeowner insurance to include incidental farming coverage. Contact our insurance professionals at Winn Insurance Group to discuss adding incidental farming coverage to your homeowner policy.