Farms have changed, and so have the risks. The addition of computer-controlled technology to traditional farm equipment has significantly increased exposures, yet many farms lack insurance protection when equipment breaks down. The Hartford Steam Boiler Inspection and Insurance Company (HSB) is making equipment breakdown insurance more affordable by helping other insurance companies package the coverage in their farm owners policies.
“Farming has always been an equipment-intensive business,” said Anthony J. Trivella, senior vice president and chief marketing officer for HSB, “but with the need for greater efficiency and output, farmers have made changes that increase equipment risks. Modern technology plays a major role in farm operations and power quality problems can damage its sensitive circuitry. And conventional machinery now has to be run harder and longer. Our approach is to make it easier and more efficient for farm insurers to automatically include equipment breakdown coverage in their farm owners package policy.”
HSB has provided individual equipment breakdown policies for many years to farms and ranches through independent agents and brokers. Now HSB offers a customized farm equipment breakdown insurance product to other property-casualty insurers who serve the farm and ranch market. HSB also supplies a full range of specialized services so insurers don’t need to add expense or staff to provide this enhancement.
“By including equipment breakdown coverage as a standard element in their property coverage, farm insurers can broaden their product and provide their clients with this important protection at lower cost than if it was bought separately,” said Trivella. “In spreading the risk among many policyholders, HSB makes the coverage much more affordable.”
Equipment breakdown insurance covers risks that standard farm policies don’t, including damage caused by mechanical breakdown, electrical arcing and short circuits. It can also pay for spoilage, lost farm income and extra expenses that result from equipment breakdown. Covered equipment includes electronic systems, deep well pumps, motors, electrical equipment, refrigeration, environmental controls, compressors and many other types of equipment. The coverage does not apply to combines, tractors and other vehicles or risks commonly protected by property insurance.
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