David W. Cavey is the owner and President of North Central Insurance Agency, an independent insurance agency offering farm insurance and many other insurance products throughout Maryland and Pennsylvania.
For the purposes of today’s discussion I will concentrate on Greenhouse Insurance as it applies to a farm insurance policy. If you have a commercial nursery operation then you most likely, or should have a commercial insurance policy and that deserves its own discussion.
With the farm to table movement many small sustainable farms are popping up and that’s a great thing. Both new and seasoned farmers are getting into this market. To ensure the natural process and get a jump on Mother Nature many farmers have constructed Greenhouses. Here are a few things that can keep insuring your Greenhouse from growing into an issue:
- A Greenhouse is considered a Farm Structure. Although some farm policies allow a grace period to add a new structure, farm structures are not automatically covered. You have to contact you agent or company representative to add the structure.
- Insurance companies want to make sure that your Greenhouse is of sound construction. A plywood structure with thin ply plastic covering may not cut it. Older glass panel Greenhouses can also be an issue. Hoop Houses, that are popular now, are usually acceptable. The insurance company wants to make sure that it is secured properly. If the structure is permanently secured on a masonry foundation they may offer discount pricing and broader coverage. Some insurance companies may not offer “broad” form coverage on Greenhouses. This would eliminate collapse from weight of ice and snow. So be sure you ask about the coverage that is being offered.
- Make sure that you are insuring your Greenhouse to the proper value. Most insurance companies require that farm structures are covered for at least 80% of the Replacement Value under Actual Cash Value coverage. Insuring it for a lessor value could cause settlement issues if a claim arises. If you’re not sure what value to insure your Greenhouse or any farm structure your agent or company representative should have construction value software available. Depending on the age and construction of the structure, replacement cost coverage may be available.
- Contents of a farm structure are not typically included in the structure value. They have to be added to the Farm Personal Property section of your farm policy. If items such as your heating and lighting system or racks are permanently installed then they are typically included in the structure value.
We have just touched a few items about insuring Greenhouses. Clear and honest discussion with a knowledgeable farm insurance agent is key in making sure you have the insurance you need.
David W. Cavey – President
North Central Insurance Agency