Summary: Up to this point, the farms discussion has covered the “personal” exposures of the farmer, indicating many similarities to the homeowners program of Insurance Services Office (ISO). Form FP 00 13 01 98 begins the coverage devoted to exclusively farm business property. Coverage E is “scheduled farm personal property.” Coverage F is “unscheduled farm personal property.”
Included in coverage E is any property scheduled on the declarations page. There are 15 types of scheduled property, with many subclasses. When a limit of insurance is shown for coverage F on the farm property declarations, unscheduled farm personal property is insured.
For coverage to be provided under coverage E, a limit of liability must be shown on the declarations page for each class of property covered. If no limit is shown on the schedule for a described kind of property, there is no insurance under coverage E for any property of that kind.
Coverage F is the second portion of form FP 00 13 devoted exclusively to commercial coverage. When a limit of insurance is shown for coverage F on the farm property declarations, unscheduled farm personal property is insured. This coverage includes all farm personal property on the premises and some types while off the premises. Nineteen types of property are identified in this unscheduled, or blanket, category.
Section II of form FP 00 13 contains six extensions that apply to one or both of these coverages.
Topics covered:
Covered property—coverage E
Property not covered—-coverage E
Special limits of liability—coverage E
Loss conditions—coverage E
Covered property—coverage F
Property not covered—coverage F
Special limits of liability—coverage F
Coverage F conditions
Property in the custody of a common carrier—coverages E and F
Property off the insured location—coverage E
Newly purchased replacement machinery, vehicles, and equipment—coverage E
Newly purchased additional machinery, vehicles, and equipment—coverage E
New livestock
Farm products in the open—coverage F
Cost to restore records
Extra expense coverage
Remainder of form
Covered Property—Coverage E
COVERAGE E — SCHEDULED FARM PERSONAL PROPERTY
A. COVERAGE
We will pay for direct physical loss of or damage to Covered Property at the “Insured Location” described in the Declarations, or elsewhere as expressly provided below, caused by or resulting from any covered cause of loss.
1. Covered Property
All of the following are Covered Property under Coverage E of this Coverage Form, provided a Limit of Insurance is shown in the Declarations for the specific type of property:
a. Grain, threshed seeds and beans, ground feed, silage, and manufactured and blended “livestock” feed in buildings or structures or in sacks, wagons or trucks; and
b. Grain in stacks, shocks, swaths or piles in the open, but for this property fire and lightning, vandalism, vehicles and theft are the only Covered Causes of Loss.
c. Hay, straw and fodder
(1) In buildings or structures; and
(2) In stacks, windrows, or bales, but for this property fire or lightning, windstorm or hail, vandalism, vehicles and theft are the only Covered Causes of Loss.
A stack means hay, straw or fodder in one area separated by a clear space of 100 feet or more from any other hay, straw or fodder in the open.
d. Farm products, materials and supplies shown in the Declarations. These include farm materials and related packing materials and containers usual to the operations of a farm, but not hay, grain or any growing crops.
e. ”Poultry” (excluding turkeys unless specified):
(1) In the open; or
(2) In any building designated for “poultry” in the Declarations.
But for this property, the Basic or Broad Covered Causes of Loss are the only Covered Causes of Loss.
f. Trays, boxes and box shook, each item or set in the proportion that its value bears to the total value of all trays, boxes and box shook covered under this Coverage Form.
g. Computers and related software used principally as aids in farm management.
But an item of software is Covered Property only up to the amount required to replace it as a prepackaged program, or in unexposed or blank form, whichever is greater.
h. Miscellaneous equipment, usual or incidental to the operation of a farm (including machinery, vehicles, tools, and supplies of all kinds), covered under a single Limit of Insurance shown for Miscellaneous Equipment in the Declarations.
But such miscellaneous farm equipment does not include:
(1) Threshing machines, tractors, combines, corn pickers, hay balers, harvesters, peanut diggers, potato diggers and pickers, cotton pickers, crop driers or sawmill equipment;
(2) Automobiles, trucks, motorcycles, motorized bicycles or tricycles, mopeds, dirt bikes, snowmobiles, four-wheel all-terrain vehicles; mobile homes, house trailers; vehicles primarily designed and licensed for road use (other than farm wagons and farm trailers); watercraft or aircraft; or the equipment, tires or parts of any of these;
(3) Liquefied petroleum or manufactured gas or fuel, or their containers;
(4) Bulk milk tanks, bulk feed tanks or bins attached to buildings or structures; barn cleaners, pasteurizers or boilers; any permanent fixtures within or attached to a building;
(5) Brooders;
(6) Fences, wind chargers, windmills or their towers;
(7) Outdoor radio or television equipment or wiring; private power and light poles;
(8) Irrigation equipment;
(9) Portable buildings and portable structures:
(10) Household personal property or property usual to a “dwelling;” or
(11) Property more specifically covered under another Coverage or Coverage Form of this or any other policy.
i. Farm machinery, vehicles and equipment that you borrow or rent without a written contract, but only to the extent that such property is not covered under another Coverage Form of this or any other policy. The borrowed or rented property must be:
(1) Usual or incidental to farming operations;
(2) In your care, custody or control; and
(3) Property in which you have no interest as owner or lienholder.
But Covered Property does not include borrowed or rented property of the following types:
(1) Automobiles, trucks, motorcycles, motorized bicycles or tricycles, mopeds, dirt bikes, snowmobiles, four-wheel all-terrain vehicles; mobile homes, house trailers; vehicles primarily designed and licensed for road use (other than farm wagons and farm trailers); watercraft or aircraft; or the equipment, tires or parts of any of these; or
(2) Dealers' demonstration machinery, vehicles or equipment.
j. Farm machinery, vehicles and equipment which are individually described and specifically covered in the Declarations, while on or away from the “insured location,” except while in the custody of a common or contract carrier.
k. ”Livestock” on or away from the “insured location,” but for this property the Basic or Broad Covered Causes of Loss are the only Covered Causes of Loss.
But we do not cover “livestock” while:
(1) In the custody of a common or contract carrier;
(2) At public stockyards, sales barns or sales yards; or
(3) At packing plants or slaughterhouses.
l. Bees, but for this property the Basic or Broad Covered Causes of Loss are the only Covered Causes of Loss.
m. Worms, but for this property the Basic or Broad Covered Causes of Loss are the only Covered Causes of Loss.
n. Fish, but for this property the Basic or Broad Covered Causes of Loss are the only Covered Causes of Loss.
o. Other Animals, but for this property the Basic or Broad Covered Causes of Loss are the only Covered Causes of Loss.
p. Portable buildings and portable structures that you own.
Analysis
The form lists 16 kinds of farm personal property as potentially covered property, if a limit is shown opposite. Each item contains a number of subgroups, definitions, and limitations:
1. Grain, etc. This category includes threshed seeds and beans, ground feed, silage, and manufactured and blended livestock feed. These items must be in buildings or structures; or, on wagons or trucks. If they are outdoors, they must be in sacks.
2. Grain in stacks, shocks, swaths or in piles in the open. The form covers these items only for the perils of fire and lightning, vandalism, vehicles, and theft.
3. Hay, straw, and fodder. The policy breaks this property into two subdivisions. The first covers property in buildings or structures.
The second provides coverage for these items in stacks, windrows, or bales. As with the grain in the open, the farm property form covers these items for only certain perils: fire and lightning, vandalism, windstorm and hail, vehicles, and theft. The policy says that a stack consists of hay, straw, or fodder in one area separated by 100 feet or more from any other hay, straw, or fodder in the open.
4. The fourth type of scheduled property is farm products, materials, and supplies. This group includes farm materials, other than grain, hay, or growing crops. It also includes related packaging materials and containers usual to the operation of a farm.
5. Item five consists of poultry (excluding turkeys unless specified). Such property may be either in the open or in any building designated for poultry in the declarations. The current form limits coverage for poultry to only the basic or broad causes of loss.
6. Scheduled property item number six is trays, boxes, and box “shook” (pre assembly boxes). These items are subject to a 100 percent co-insurance clause, based on the total value of all such property covered under the farm property form. Note that this pro rata clause has the effect of limiting recovery on individual units whenever the total insurance carried on this property is less than 100 percent of the total value of all trays, boxes, and shook.
7. Computers and related software used principally as aids in farm management are item seven. The form limits the value of software items to the greater of: the cost to replace them as prepackaged programs; in unexposed or blank form.
8. Item eight consists of miscellaneous equipment usual or incidental to the operation of a farm. This definition includes machinery, vehicles, tools, and supplies of all kinds, but excludes the following 11 groups of property:
(1) Threshing machines, tractors, combines, corn pickers, hay balers, harvesters, peanut diggers, potato diggers and pickers, cotton pickers, crop driers, or sawmill equipment.
(2) Automobiles, trucks, motorcycles, motorized bicycles or tricycles, snowmobiles, mobile homes, house trailers, vehicles primarily designed and licensed for road use (except farm wagons and farm trailers), watercraft, and aircraft. Also excluded are the equipment, tires, and parts of any of these.
(3) Liquefied petroleum or manufactured gas, fuel, or their containers.
(4) Bulk milk or feed tanks or bins attached to buildings or structures; barn cleaners, pasteurizers or boilers; or any permanent fixtures within or attached to a building.
(5) Brooders.
(6) Fences, wind chargers, windmills or their towers.
(7) Outdoor radio or television equipment or wiring, private power and light poles.
(8) Irrigation equipment.
(9) Portable buildings or structures.
(10) Household personal property or property usual to a dwelling).
(11) Property more specifically covered under the farm property form or any other policy.
Coverage for most of the property excluded from item 8 can be provided elsewhere in the farm property schedule, except for property such as motor vehicles licensed for highway use, aircraft, and watercraft, customarily insured under separate policies.
9. Borrowed farm machinery, vehicles, and equipment. To qualify for this coverage, such property must meet the following requirements:
1. It must be usual or incidental to farming operations;
2. It must be in the insured's care, custody or control.
3. The insured may have no ownership or leasehold interest in the property.
In the same language as that used to eliminate coverage for motor vehicles, the form eliminates coverage for such things when borrowed by the farmer. Neither does it cover dealers' demonstration machinery, vehicles, or equipment. Borrowed property, in general, is covered only to the extent that it is not covered under this or any other policy of the insured.
10. Farm machinery, vehicles, and equipment on or away from the insured location. The form covers these items other than while in the custody of a common or contract carrier. Space is allowed on the schedule to list year, make, and model of each item of equipment included under this item.
11. Livestock on or away from the insured location. However, the current form limits coverage for this item to the basic or broad causes of loss.
However, the form does cover livestock:
a. in the custody of common or contract carrier;
b. at public stockyards, sales barns, or sales yards; or
c. at packing plants or slaughterhouses.
There is space on the schedule for listing class and type of animals insured as well as for providing specified amounts of insurance on individual animals.
12. Bees.
13. Worms .
14. Fish.
15. Other animals.
Again, the current form limits coverage for items twelve through fifteen to the basic or broad causes of loss.
16. Portable buildings and structures owned by the insured.
Property Not Covered—Coverage E
2. Property Not Covered
Under Coverage E, Covered Property does not include:
a. Growing crops, trees, plants, shrubs or lawns;
b. Household personal property or property usual to a “dwelling;”
c. Magnetic recording or storage media for electronic data processing, such as cell, disc, drum, film and tape, over or above their replacement value:
(1) As prepackaged software programs; or
(2) In unexposed or blank form; whichever is greater.
d. Any permanent fixtures within or attached to a building; or
e. Outdoor radio or television equipment or wiring; private power and light poles.
Analysis
In addition to the various limitations and exceptions found in the descriptions of covered scheduled farm personal property, form FP 00 13 specifies another five kinds of property as not covered under coverage E:
1. Growing crops, trees, plants, shrubs, or lawns. Coverage for growing crops is a separate kind of insurance offered by crop hail insurers, including the Federal government. Limited coverage for the other four items is provided as extension A. for coverage A or C.
2. Household personal property or property usual to a dwelling. Coverage for these items is found in coverages C and A.
3. Magnetic recording or storage media for electronic data processing, such as cell, disc, drum, film, and tape over and above their replacement value: (1) as prepackaged software programs, or (2) in unexposed or blank form, whichever is greater. Note that, while listed with the property exclusions, this is actually a limitation on the insurable value of this property, not a property exclusion. It essentially duplicates in different language the limitation on computer software found in covered property item g.
4. Any permanent fixtures within or attached to a building. Coverage on such property is provided under coverages A, B, and G. This exclusion makes clear that should there be no, or inadequate, building insurance, building fixtures cannot be claimed as farm personal property under coverage E.
5. Outdoor radio or TV equipment or wiring, private power and light poles. The radio and TV equipment (but not its wiring) is covered, if scheduled, under other farm structures coverage G. Private power and light poles, and their wiring (their wiring is not excluded here) and attachments are covered for up to $250 per occurrence under coverage G, coverage extension a., and additional coverage above $250 can be provided by a coverage G scheduled item.
Special Limits of Liability—Coverage E
3. Special Limits Of Insurance Under Coverage E
Under Coverage E, certain individual items of “farm personal property” are subject to Special Limits of Insurance. These Special Limits are part of, not in addition to, the applicable Limits of Insurance shown in the Declarations.
a. If no specific stack limit is shown in the Declarations for hay, straw or fodder in the open, the Limit will be $10,000 on any one stack.
b. For covered “poultry,” the Limit of Insurance per bird under any provision of this Coverage Form applicable to “poultry” will be its cash market value as of the time of loss.
c. The Limit of Insurance on any one item of miscellaneous equipment is $2,000.
d. The most we will pay for loss of or damage to any one head of “livestock” (other than animals individually described and specifically covered under this coverage) is the least of the following amounts:
(1) 120 percent of the amount obtained by dividing the total insurance on the class and type of animal involved by the number of head of that class and type owned by you as of the time of loss.
(2) The actual cash value of the animal destroyed or damaged.
(3) $2,000.
Each horse, mule or head of cattle under one year of age as of time of loss will be counted as 1/2 head.
Analysis
Subsection three of coverage E lists four special limits of insurance. These special limits are a part of — not in addition to — the applicable limits of insurance shown in the coverage E schedule. Under previous edition of the farm property form, these limits applied in excess of any applicable deductible. The current version eliminates this provision, thus making these items subject to “first dollar coverage”:
If no special stack limit is shown for hay, straw, or fodder in the open (schedule item three) a limit of $10,000 applies to any one stack.
For covered poultry (schedule item five), the limit of insurance per bird is its market value at time of loss.
The limit of insurance on any one item of miscellaneous equipment (schedule item 8) is $2,000.
Livestock, other than animals individually described and specifically covered, are valued per head at the lowest of the following amounts:
1. 120 percent of the limit of insurance for the class and type of animal divided by the number of animals of that class and type owned by the insured at time of loss.
2. The actual cash value of the animal.
3. $2,000.
Each horse, mule, or head of cattle under one year of age at time of loss is counted as one-half head. To illustrate how this limitation applies: a farmer owns 60 head of beef cattle, each with a value in excess of $2,000, 20 of which are under a year old; and he has a limit of insurance on the herd of $50,000. Limit (1) is $1,200 each for the older cattle and $600 for the calves (120 percent of $50,000 divided by 50 [40 + 1/2 of 20]=$1,200) and will apply. If the limit of insurance is $100,000, limit (1) is $2,400 and limit (3) applies, paying $2,000 for older animals and one-half or $1,000 for calves.
Loss Conditions—Coverage E
B. COVERAGE E CONDITIONS
Coverage E is subject to the following Loss Conditions as well as to the Farm Property Conditions (see Farm Property – Other Farm Provisions Form – Additional Coverages, Conditions, Definitions) and the Common Policy Conditions.
Loss Conditions
1. Portable Buildings and Portable Structures that You Own
The most we will pay for loss of or damage to this property in any one occurrence is the proportion that the applicable Limit of Insurance shown in the Declarations bears to the value of all portable buildings and portable structures you own as of the time of loss.
2. Pro Rata Distribution - Applicable Only to Grain, Hay, Straw and Fodder, to Farm Machinery, Vehicles and Equipment, and to Poultry in Unheated Buildings.
This Condition applies only if Scheduled “farm personal property” is covered at more than one “insured location”. The Limit of Insurance for any category of covered “farm personal property” mentioned in the heading of this Condition will apply at any one “insured location” in the proportion that the value of Covered Property in that category at that location bears to the value of all Covered Property in that category at all “insured locations”.
3. Livestock, Poultry, Bees, Fish, Worms and Other Animals
With respect to “livestock”, “poultry”, bees, fish, worms, and other animals, the term loss means death or destruction caused by, resulting from or made necessary by a covered cause of loss.
4. Valuation
In the event of loss of or damage to covered “farm personal property”, we will settle at actual cash value as of time of loss, but we will not pay more than the amount necessary for repair or replacement.
5. Coverage Territory
We cover loss or damage commencing within the coverage territory. The coverage territory is:
(1) The United States of America ;
(2) Puerto Rico; and
(3) Canada .
Analysis
Five loss conditions apply to coverage E, as follows:
1. Owned portable buildings and structures. This loss condition limits the insurer's liability for loss or damage to these items to the same portion of the loss that the limit of insurance bears to the total value of all portable buildings or structures covered by that item at time of loss.
Note the similarity of this clause to the pro rata provision included in covered property subsection f. relating to trays, boxes and box shook. But there is an important difference. That clause sets a limit per item based on the relation of insurance limit to value, in effect, at time of loss converting blanket insurance to specific insurance on each item. Partial loss to an item will be paid up to the limit established by the clause for that item. For example: perhaps 1,000 boxes are valued at $10,000, but the limit is set at only $5,000. A single item may be covered to its full value up to $5,000 should it happen that its value is, indeed, equal to 50 percent of the value of all items insured.
But the portable buildings and structures clause limits recovery of a partial loss to a portable building or structure to the same proportion of the loss that the limit of insurance bears to the total insurable value of all property covered under that item (the equivalent of a 100 percent coinsurance clause).
2. Pro rata distribution. This clause, applies only to these scheduled items: grain; hay, straw, and fodder; poultry in unheated buildings; and farm machinery, vehicles and equipment. It applies to any of these items when kept at more than one insured location. The clause limits the insurer's liability for loss to affected property at any one location to the same proportion that the value of the property at that location bears to the total value of all property covered at all insured locations at time of loss. An insured may have $100,000 of scheduled farm machinery at any of three insured locations. If all are at one such location at the time of loss, the insured can recover for total loss. In short, as the values are distributed over three insured locations, so is the limit. An insured cannot cover only the principal exposure at the main location and benefit from a spill over affect at other locations.
3. Livestock. Loss to livestock is defined as death or destruction caused by, resulting from, or made necessary by a covered cause of loss. This condition also applies to poultry, bees, fish, worms, and other animals.
4. Valuation. This clause provides for settlement of all losses at actual cash value at time of loss, but not to exceed the amount necessary for repair or replacement.
5. Territory. The coverage territory is the United States, Canada, and Puerto Rico.
Covered Property—Coverage F
COVERAGE F – UNSCHEDULED FARM PERSONAL PROPERTY
A. COVERAGE
We will pay for direct physical loss of or damage to Covered Property at the “insured location” described in the Declarations, or elsewhere as expressly provided below, caused by or resulting from any Covered Cause of Loss.
1. Covered Property All of the following are Covered Property under Coverage F of this Coverage Form, provided a Limit of Insurance is shown in the Declarations:
a. All items of “farm personal property” on the “insured location”, except for items specified under paragraph 2. Property Not Covered; and
b. The following items of “farm personal property” away from the “insured location”:
(1) Grain, ground feed, fertilizer, fodder, hay, herbicides, manufactured and blended “livestock” feed, pesticides, silage, straw, threshed beans and threshed seeds, except while:
(a) Being stored or processed in Commercial drying plants, manufacturing plants, public elevators, seed houses or warehouses; or
(b) In the custody of a common or contract carrier.
(2) ”Livestock”, except while:
(a) In the custody of a common or contract carrier;
(b) At public stockyards, sales barns or yards; or
(c) At packing plants or slaughterhouses.
But for “livestock”, the Basic or Broad Covered Causes of Loss are the only Covered Causes of Loss.
(3) Farm machinery, equipment implements, tools and supplies, except:
(a) Items specified under paragraph 2. Property Not Covered; or
(b) While in the custody of a common or contract carrier.
Analysis
Subsection one of coverage F describes covered property under that item as all items of farm personal property on the insured location, except for any of the nineteen types of unscheduled farm property identified as not eligible (see below). The only change in the current form is that it limits coverage for unscheduled livestock to the basic and broad causes of loss, only.
Property Not Covered—Coverage F
2. Property Not Covered
Covered Property does not include:
a. Household or personal property usual to a “dwelling”;
b. Magnetic recording or storage media for electronic data processing, such as cell, disc, drum, file and tape, over or above their replacement value:
(1) As prepackaged software programs; or
(2) In unexposed or blank form;
whichever is greater.
c. Animals other than “livestock”;
d. “Poultry”, bees, fish or worms;
e. Racehorses, show horses or show ponies;
f. Any of the following while being stored or processed in manufacturing plants, public elevators, warehouses, seed houses or commercial drying plants: grain, threshed seeds, threshed beans, hay, straw, fodder, silage, ground feed, herbicides, fertilizer, manufactured or blended “livestock” feed;
g. Trees, plants, shrubs or lawns;
h. Tobacco, cotton, vegetables, root crops, potatoes, bulbs, fruit or nursery stock;
i. Crops in the open, except to the extent provided for in the applicable Coverage Extension ins Section II of this Coverage form;
j. Contents of chicken fryer or broiler houses, laying houses, “poultry” brooder or duck or turkey houses;
k. Automobiles, trucks, motorcycles, motorized bicycles or tricycles, mopeds, dirt bikes, snowmobiles, four-wheel all-terrain vehicles; mobile homes, house trailers; vehicles primarily designed and licensed for road use (other than farm wagons and farm trailers); watercraft or aircraft; or the equipment, tires or parts of any of these;
l. Fences; windmills or wind chargers or their towers;
m. Bulk milk tanks, bulk feed tanks or bins attached to buildings or structures; barn cleaners, pasteurizers or boilers; any permanent fixtures within or attached to a building;
n. Outdoor radio or television equipment;
o. Portable buildings or portable structures;
p. Irrigation equipment;
q. Property separately described and specifically covered in whole or in part under another Coverage or Coverage Form of this or any other policy;
r. Cotton pickers and harvester-thresher combines; or
s. Any property shown in the Declarations under the heading OTHER PROPERTY NOT COVERED UNDER COVERAGE F.
Analysis
Nineteen kinds of property are listed as not covered. It is important in writing unscheduled farm personal property to recognize all of these items that are not covered, so that scheduled property coverage or inland marine floater coverage can be arranged on any of them, as required.
Special Limits of Liability—Coverage F
3. Special Limits of Insurance Under Coverage F
Under Coverage F, individual “livestock” are subject to Special Limits of Insurance. These Special Limits are part of, not in addition to, the applicable Limit of Insurance shown in the Declarations.
The most we will pay for loss of or damage to any one head of “livestock” is:
a. $1,000 on any horse, mule or head of cattle under one year of age as of time of loss; and
b. $2,000 on any head of “livestock” not included under a. above.
If it becomes necessary to impose the penalty provided for in the last sentence of the Coverage F Loss Condition-Coinsurance (see 7.b. below), no amount used as the actual cash value of an animal will exceed the applicable Limit of Insurance specified above.
Analysis
Subsection three applies special limits of insurance to livestock insured under coverage F. These limits are a part of, not in addition to, the applicable limit of liability shown in the declarations. Previous forms applied the deductible to these losses; the current form does not. If a coinsurance penalty is necessary, the policy limits the amount used for the actual cash value of livestock to the above figures.
Coverage F Conditions
B. COVERAGE F CONDITIONS
Coverage F is subject to the following Loss Conditions as well as to the Farm Property Conditions (see Farm Property – Other Farm Provisions Form – Additional Coverages, Conditions, Definitions) and the Common Policy Conditions.
Loss Conditions
a. Livestock
With respect to “livestock,” the term loss means death or destruction caused by, resulting from or made necessary by a covered cause of loss.
b. Coinsurance
You must maintain insurance on unscheduled “farm personal property” to the extent of at least 80 percent of its actual cash value as of the time of loss. If you fail to do this, the percentage we pay of any loss will be the result produced by dividing the Limit of Insurance actually carried by the required Limit of Insurance.
The following provision applies in the event of loss of or damage to machinery or equipment within thirty days after the purchase of additional or replacement machinery or equipment.
If the Limit of Insurance actually carried becomes inadequate due to the purchase of additional or replacement machinery or equipment, then, up to $50,000 of the value of the newly purchased machinery or equipment will be omitted in determining the required Limit of Insurance.
c. Valuation
In the event of loss of or damage to covered “farm personal property”, we will settle at actual cash value as of time of loss, but we will not pay more than the amount necessary for repair or replacement.
d. Coverage Territory
We cover loss or damage commencing within the coverage territory. The coverage territory is:
(1) The United States of America ;
(2) Puerto Rico; and
(3) Canada .
Analysis
In addition to the farm property conditions, coverage F is subject to four loss conditions:
a. Livestock. The policy clarifies that only death or destruction caused by, resulting from, or made necessary by a covered cause of loss will be covered.
b. Coinsurance. An 80 percent coinsurance clause applies to unscheduled farm personal property. The clause is standard except in the way it applies to loss or damage of machinery or equipment. Up to $50,000 of newly acquired machinery or equipment is exempt from the coinsurance computation, if the acquisition was within thirty days of the loss. Note that, unlike the coverage extensions for coverage E on newly purchased machinery, vehicles, and equipment, there is no additional coverage provided under coverage F; there is only this coinsurance exemption on the first $50,000 of newly acquired machinery and equipment.
c. Valuation. The same valuation clause applies to coverage F that is used for coverage E; it contains the same statement that settlement for farm personal property loss is “at actual cash value” rather than at no more than actual cash value.
d. Territory. The policy territory is defined as the United States, Puerto Rico, and Canada .
Property in the Custody of a
Common Carrier—Coverages E and F
A. PROPERTY IN THE CUSTODY OF A COMMON OR CONTRACT CARRIER
This Coverage Extension applies to Coverages E and F.
Coverage is extended to apply to “farm personal property,” insured under Coverage E or Coverage F, while in the custody of a common or contract carrier, for up to a total of $1,000 under each of these coverages. However, if a higher limit is specified in the Declarations for Coverage E or Coverage F – Property in the Custody of a Common or Contract Carrier, the higher limit will apply to the Coverage(s) specified instead of $1,000.
Analysis
This coverage extension provides up to $1,000 coverage for farm personal property (scheduled or unscheduled) while in the custody of a common or contract carrier. However, if the property is scheduled for a greater amount, that amount will apply.
Property Off the Insured Location—Coverage E
B. COVERED PROPERTY AWAY FROM THE “INSURED LOCATION”
This Coverage Extension applies to Coverages E.
1. Coverage is extended to apply to Covered Property while away from the “insured location,” for up to a certain percentage of the Limit of Insurance shown in the Declarations for the specific type of property, as follows:
a. 25 percent, for Miscellaneous Equipment Usual or Incidental to the Operation of a Farm; or
b. 10 percent, for other types of property.
2. This Coverage Extension is part of, not in addition to, the applicable Limit of Insurance or Special Limit of Insurance.
3. This Coverage Extension does not apply to:
a. “Livestock” or individually insured farm machinery, vehicles or equipment which are described in paragraph 1.j. or 1.k. of Covered Property;
b. Property while in the custody of a common or contract carrier;
c. Property stored or being processed in manufacturing plants, public elevators, warehouses, seed houses or commercial drying plants; or
d. Property in public sales barns or public sales yards.
4. Under this Coverage Extension, the greatest proportion we will pay of any one loss is the proportion we would have paid if every policy covering the property involved in the loss had provided the same coverage as this Coverage Extension.
Analysis
Covered property away from the insured location. Under Coverage E: 25 percent of the limit of insurance scheduled for “miscellaneous equipment usual or incidental to the operation of a farm” applies off premises. 10 percent of the various limits of insurance applies to all other scheduled items under coverage E. This extension does not cover:
1. livestock or farm machinery, vehicles, or equipment individually insured on this form;
2. property in the custody of a common or contract carrier;
3. property stored or being processed in manufacturing plants, public elevators, warehouses, seed houses, or commercial drying plants; and
4. property in public sales barns or yards.
This extension is part of the limit of insurance of the scheduled item. When more than one policy covers the same item of scheduled farm personal property, the extension pro rates with the other coverage — whether it has a similar off-premises extension or not. Fire policies with extended coverage (wind, hail, smoke, riot, etc.) once carried an “apportionment clause” having the same effect. If a property owner insured his building with one $5,000 policy for fire and one $5,000 for fire and extended coverage, an extended coverage loss was adjusted as if the other fire policy included extended coverage also; a $1,000 wind loss would be covered for $500 under the one policy with fire and extended coverage.
It is important to note that only property covered under coverage E is affected by this extension. Coverage E relates to 16 possible different specific categories of property (if scheduled). For each category, this extension provides that 10 percent of the scheduled limit applies off premises.
Coverage E also may include a “blanket” item for miscellaneous property, 25 percent for off-premises coverage. In no event does this extension apply to the four types of property listed above.
Newly Purchased Replacement Machinery,
Vehicles, and Equipment—Coverage E
C. REPLACEMENT MACHINERY, VEHICLES, AND EQUIPMENT NEWLY PURCHASED
This Coverage Extension applies to Coverage E.
A Special Limit of Insurance equal to $50,000 plus the corresponding limit specified in the Declarations for individually scheduled items of Farm Machinery, Vehicles and Equipment applies to any item of property purchased as a replacement of such machinery, vehicle or equipment.
The additional $50,000 coverage will end:
1. thirty days after the date of purchase of the replacement item; or
2. When this policy expires;
whichever comes first.
In no event will we pay more than the actual cash value as of the time of loss.
A newly purchased vehicle or item of machinery or equipment is covered under this Coverage Extension only to the extent that it is not covered under another Coverage or Coverage Form of this or any other policy of the “insured.”
Analysis
Form FP 00 13 covers a replacement piece of equipment at the limit for which the old item was scheduled, plus $50,000. This is a limit, not a guaranteed amount and a specific reference to ACV loss adjustment makes that clear. Coverage is good for thirty days or until the policy expires, whichever is sooner. So it is important for the insured to report a new acquisition to the insurer and get the new item added with the appropriate limit.
The same extension covers new property, but only if the property is not otherwise covered under the farm property form or any other policy of the insured.
Newly Purchased Additional Machinery,
Vehicles, and Equipment—Coverage E
D. ADDITIONAL MACHINERY, VEHICLES, AND EQUIPMENT NEWLY PURCHASED
This Coverage Extension applies to Coverage E.
1. Coverage on such items of farm equipment, machinery and vehicles such as tractors, combines, harvesters, corn pickers and hay balers, will extend to apply to newly purchased additional farm equipment, machinery and vehicles.
2. The most we will pay under this Coverage Extension is $100,000 for loss of or damage to all such Newly Purchased Additional Farm Equipment, Machinery and Vehicles. This $100,000 Limit is part of, not in addition to, the applicable Limit of Insurance.
3. When values for Newly Purchased Additional Farm Equipment, Machinery and Vehicles are reported under this Coverage Extension, additional premium for these values will be due and payable from the date of purchase.
4. None of the following is covered under this Coverage Extension:
a. Automobiles, trucks, motorcycles, motorized bicycles or tricycles, mopeds, dirt bikes, snowmobiles, three-wheel all-terrain vehicles; mobile homes or house trailers; vehicles primarily designed and licensed for road use (other than farm wagons and farm trailers); watercraft, aircraft; or their equipment, tires or parts;
b. Liquefied petroleum or manufactured gas or fuel, or their containers;
c. Brooders, fences, wind chargers, windmills or their towers; or
d. Any farm equipment, machinery, or vehicles purchased as replacements of equipment, machinery, vehicles or equipment specifically described in the Declarations.
5. This Coverage Extension will end:
a. thirty days after the date of acquisition of the additional item; or
b. When this policy expires;
whichever comes first.
6. Newly Purchased Additional Farm Equipment Machinery and Vehicles are covered under this Coverage Extension only to the extent that they are not covered under another Coverage or Coverage Form of this or any other policy of the “insured”.
Analysis
When coverage is provided on one or more scheduled items of farm machinery, vehicles, or equipment, the form covers a newly purchased item of the same class for up to $100,000. Again, this coverage is good for thirty days or until the policy expires, whichever is sooner. The coverage applies only to the extent that the new property is not otherwise covered under the farm property form or any other policy of the insured. An additional premium is payable for the added coverage from date of purchase.
This extension does not cover replacement property covered with a higher limit, nor property of the kinds listed as not eligible.
New Livestock
E. ADDITIONAL ACQUIRED LIVESTOCK
This Coverage Extension applies to Coverage E.
1. If Coverage E covers “livestock”
a. specifically declared and described in the Coverage E Declarations; or
b. with separate Limits of Insurance per class shown in the Coverage E Declarations;
we will cover additional “livestock” you acquire during the policy period, for up to thirty days from acquisition.
2. The most we will pay under this Coverage Extension is the lesser of:
a. The actual cash value of the additional livestock; or
b. 25 percent of the total of the Limits of Insurance shown in the Coverage E Declarations for:
i. Specifically declared and described “livestock;” and
ii. “Livestock” with separate limits per class.
3. You must report the additional livestock within thirty days from the date of acquisition and pay any additional premium due. If you do not report such property, coverage will end thirty days after the date of acquisition.
Analysis
If the insured has scheduled livestock coverage, then the policy covers newly acquired livestock for the lesser of: the actual cash value of the new animal; or 25 percent of the limits shown on the declarations page for scheduled and blanket livestock insurance coverage E. This extension of coverage is good for thirty days.
Farm Products in the Open—Coverage F
This Coverage Extension applies to Coverage F.
You may apply up to 10 percent of the Limit of Insurance shown in the Declarations for “farm personal property” to cover the following in the open:
1. Grain in piles, shocks, stacks or swaths;
2. Hay, straw and fodder in stacks, windrows or bales; but the most we will pay for loss or damage is $10,000 for any one stack of hay, straw or fodder.
A stack means hay, straw or fodder in one area separated by a clear space of 100 feet or more from any other hay, straw or fodder in the open.
Fire or lightning, windstorm or hail, vandalism, vehicles and theft are the only Covered Causes of Loss for the property named in one and two above.
3. Unharvested barley, corn, oats, rye, wheat and other grains, flax, soy beans and sunflowers (but not on seed or forage crops, straw or stubble).
Fire or lightning is the only Covered Cause of Loss for this property.
This Extension is part of, not in addition to, the applicable Limit of Insurance.
Analysis
Extension F describes the extension of limited coverage to farm products in the open. The insured may apply up to 10 percent of the limit of insurance for farm personal property to cover certain types of property in the open:
1. Grain in piles, shocks, stacks, or swathes.
2. Hay, straw, and fodder in stacks, windrows, or bales, but not more than $10,000 in any one stack. The form defines a stack as hay, straw or fodder in one area separated by 100 feet or more from any other hay, straw or fodder in the open.
Coverage under 1. and 2. applies only for the perils of: fire or lightning, windstorm or hail, vandalism, vehicles, and theft.
3. Unharvested barley, corn, oats, rye, wheat, and other grains, flax, soy beans, and sunflowers. The form only covers sunflowers grown as crops and not those that “just appear” in seed or forage crops, straw, or stubble. The extension to these crops is only for the perils of fire and lightning.
This extension is part of, not in addition to the applicable limit for farm personal property.
Cost to Restore Records
A. COST OF RESTORING FARM OPERATIONS RECORDS
For any one loss we will pay up to $2,000 to cover your cost to research, replace or restore the lost information on farm operations records damaged by a Covered Cause of Loss.
But if a higher Limit of Insurance is specified in the Declarations, the higher limit will apply.
No deductible applies to this Additional Coverage.
Analysis
The policy provides $2,000 to cover the insured's cost to research, replace, or restore the lost information on records of farm operations damaged by a covered cause of loss. Higher limits may be purchased, and no deductible applies to this coverage.
Extra Expense Coverage
B. EXTRA EXPENSE
If a Limit of Insurance is shown in the Declarations for Extra Expense Coverage, we will pay, up to the Limit of Insurance shown in the Declarations, the actual and necessary expenses you incur to resume normal farming operations interrupted as the result of direct physical loss of or damage to Covered Property by a Covered Cause of Loss.
Coverage for such extra expense is not limited by the expiration of this policy. But, we will not pay extra expense you incur after the period required for repair, rebuilding or replacement of Covered Property.
Extra Expense Coverage does not include loss caused by or resulting from the enforcement of any ordinance or law which requires any “insured” or others to test for, monitor, clean up, remove, contain, treat, detoxify, neutralize, or in any way respond to, or assess the effects of, “pollutants”.
No deductible applies to this Additional Coverage.
Analysis
This coverage applies when an amount is shown for 'extra expense' on the farm property declarations. This item provides coverage up to that amount for the 'actual and necessary expenses' incurred by the insured to resume normal farming operations, interrupted as the result of direct physical loss or damage to covered property insured under coverages E or F, by a covered cause of loss.
This coverage is not limited by the expiration of the policy, but does not extend beyond the period required for repair, rebuilding, or replacement of covered property. It also does not cover any extra expense incurred as a result of the enforcement of any building law or ordinance. No deductible applies to extra expense coverage.
Remainder of Form
The reader is referred to form FP 00 90 01 98, farm property – other farm provisions form – additional coverages, conditions, definitions, for those items, as they apply to coverages E and F.
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