kiotiken said:
In addition to those questions, I want to know what happens if I'm on the road and hit something/somebody or if I'm helping a neighbour and an unthinkable accident happens and somebody is hurt/killed. I want to make sure I'm going to be covered if somebody tries to sue me.
Lots of great questions and comments on this thread. As several guys have lender me a hand with so many topics, I have finally found one I can offer something in return.
Having been in insurance claims, underwriting and aaa an agent, I have a pretty good understanding of these issues. Likewise, having a nice Kubota
M5040, I have a vested interest in protecting my baby!
Lots of variables to consider. In general, most Insurance policies are very similar, however a few companies will limit or exclude coverages more than some. I can speak to State Farm and several other main insurers.
So, the variables: 1) type of policy: Homeowners, Farm/Ranch, Personal Articles/Inland Marine, 2) Use of the tractor 3) Location of the tractor.
1. Homeowners (HO) will cover tractors and equipment used to maintain the residence and land. The key is what is covered, which is typically only the named perils for personal property. The primary concerns are theft, fire, tree falling on it. All of these are covered. Then you have the liability aspect, as long as the use is maintaining your property, you will be covered. If you are trailering your tractor and you lose your tractor off the trailer or have an accident, you will not likely have coverage aside from someone else causing the accident. Then good luck with them having enough insurance, a $35000 truck, $30-40000 tractor.....many people don't carry more than $50000 coverage. So you are out of luck. And we haven't even factored in the trailer.... Bottom line, if you are taking your tractor off your property for more than service, I would suggest getting coverage for the tractor specifically. Many of us with tractors have farm liability if we are haying, harvesting, running cattle, etc. which makes it extremely important to get a farm liability policy or and Farm/Ranch policy.
2. Farm/Ranch (FR) policies cover tractors if you have them scheduled or have blanket equipment coverage. You can also get ADPL coverage to cover if you roll the thing on a hill or back into it with your truck, etc. So you get even more coverage than you would under an HO. Plus your liability is getting you covered for farming activity. However, the liability off the property can be limited to taking it in for service or traveling between sections of ground. For those with 5 or 10 acres, you simply won't have liability traveling down the road to the mailbox. FR is by far the better option over HO if you can qualify for a farm. Without farming operations, it won't happen.
3. Personal Articles Policy (PAP) or Inland Marine (IM), same thing either way, but you can get a Personal IM or Commercial IM, just depends on your situation. So, these policies give you the absolute most coverage for your tractor, period. All peril coverage, meaning if it is stolen, burns up, tree falls on it, you roll it off your trailer or over a hill, hail damage, etc. It is the broadest coverage you can get. There is no liability from this policy, that would come from your HO or FR.
Use of the tractor determines HO or FR for liability, if truly farming then FR, otherwise HO. One side note, if you use it for Business in ANY way, you better have it covered under your Business/Contractor General Liability policy which would typically attach a Commercial IM to it. If you use it for business and only have it insured under a HO, you will likely only receive at most $1000. From a personal use standpoint, your HO policy will cover you should the unthinkable happen. FR example, you go over to help plow out your neighbors driveway, you are doing it without compensation, you run his kid over....your HO liability applies,
One thing to consider, just as the example above is worst case, it is a risk we create by owning machinery. A liability umbrella policy is critical in making sure we have enough to pay for these accidents, as well protect us from losing all we have worked for to accrue this stuff. A umbrella is typically $1 million policy that covers us in addition to our HO, FR, or even Auto policies. If you don't have an umbrella policy, also called a PLUP, get one. In today's worked, $1M isn't much, but it is a heck of a lot more than $100k on your HO or Auto. The difference of having an insurance company write a big check vs. you literally breaking out your own checkbook to pay out.
My apologies for the length, but it really is a very in depth topic. Hope my diatribe helps one person.
