Agricultural and Farm Insurance

Introduction

This year the floods that devastated Queensland and Victoria will have a significant impact on Australia’s agricultural sector. The sector will lose $2.1Bn across many agricultural industries including food, crops and livestock. A report prepared by Ibis World “Australian Floods: The Economic Impact” (special report February 2011) offers commentary on the impact of flood devastation on the following sectors:-

Fruit and Vegetables

• Queensland supplies 28% of Australia’s fruit and vegetables and Victoria 26%
• The floods have disrupted harvest for fruit and vegetables such as pumpkins, tomatoes, capsicums, celery, avocadoes, lettuce, zucchini, broccoli, potatoes, mangoes, bananas, melons, stone fruit, tropical fruit, grapes and seedless watermelon
• It is expected that industry revenue for Australian fruit and vegetable growers is likely to decline by 9% overall for the 2010/2011 year. This represents a combined loss of approximately $762M

Cotton

• Queensland produces nearly half of Australia’s cotton. Losses are expected to exceed 300,000 bales
• Ibis World expects a 17.1% contraction for Australia’s cotton growing industry. This constitutes a loss of $200M

Sugar

• Australia is a leading exporter of sugar globally
• 95% of Australia’s annual sugar growing crop is produced in Queensland
• It is expected that sugar cane revenue will fall by 26.6%

Grains

• There will be a $501M impact on Australia’s grain industry as reported by Ibis World
• 500 tonnes of grain losses in wheat, barley and sorghum have been sustained

Livestock

• The most significant problem for livestock is the interruption to its transportation
• The rights of those participating in the agriculture industry to claim on insurance will be of paramount significance to the ability of the Australian economy to recover

Agricultural and Farm Coverage

Insurance in the agricultural sector normally is effected against the “business” that operates the farm or property and this generally includes activities such as farming, grazing, cropping, harvesting, or other like primary producing activities. Farm policies are usually contained in a farm pack to cover not only the domestic and personal assets of the proprietors, but also farm property, machinery, hay, fencing, livestock, farm trees, business interruption, road transport, stock theft.

The significance of the coverage is contingent upon the wording of the particular policy and what is covered.

Key Questions and Information

• Did you engage a broker or agent to advise you, or to secure your policy of insurance? If so, what did you tell them you needed cover for, or what did they advise you?
• Are you happy with what your insurer has offered you in respect of the claim? If not, then you may be entitled to more, subject to proving your loss and the wording of the policy.
• Has your insurer denied indemnity altogether? Are they correct and have you sought advice?
• Do you need help in assessing your loss and making a submission to the insurer?
• Are you unhappy with your insurer’s approach to date?

Want Answers Fast?

Please call our Insurance Recovery team at Shine Lawyers on 13 11 99 today.