To qualify for Agri insurance you must be a bona fide farmer, this means your dominant income is generated from farming activities, on an agricultural property.
To insure your assets on an Agri policy there must be an insurable interest. A business has an insurable interest in something when loss or damage to it would cause the business to suffer a financial loss.
Unpredictable weather patterns, natural disasters, damage due to loadshedding and climate change are unfortunately not avoidable and are just a few risks farmers face which put their business operations, crops, and assets at risk.
According to Agriculture SA, the extreme weather events over the years have caused devastation to many farmers and many of them never recovered. Daniel Stevens, Head of Agriculture Crop at Santam said that only 40% of farmers take up crop insurance. Agri insurance is there to protect farmers against sudden and unforeseen damage to their crops and assets.
Natural disasters such as hail can cause extensive damage to crops which could mean significant yield loss or the end of the growing season for some resulting in big financial losses. Earlier this year a massive hailstorm wreaked havoc in the Langkloof, a small village in the north-east of George. AgriSA chief executive Christo van der Rheede said this incident once again showed how exposed farmers were to various environmental risks.
Agricultural insurance is not only about insuring your crops and assets, but you also need to think about liability that may arise, for example, the spread of fire. If a fire starts on your property and spreads to your neighbour, you can be held liable. The National Veld and Forestry Act sets out the rules and regulations farmers must adhere to. Liability claims can easily become millions and without adequate insurance, your business may face significant consequences.
Every farmer’s situation is unique and will require a tailor-made product to suit their specific needs.
Should you be interested in Agri insurance or require advice on your existing insurance, contact our team of experts today.
Although all possible care was taken in the drafting of this document, the factual correctness of the information contained herein cannot be guaranteed. This document does not constitute advice and anyone planning on taking any financial action based on this document, is strongly advised to first consult with their personal financial advisor. ProVérte Risk Management is an authorised financial service provider with FSP no. 51584
