Taking risk out of pedigree livestock insurance.
PEDIGREE livestock is becoming increasingly sought after by farmers, with numerous record-breaking prices having been recorded over the past year.
If such animals are stolen or killed in accidents, however, they can be prohibitively expensive to replace.
"And, unfortunately in many cases, general insurance is insufficient to cover the loss," said Carol Rickerby from the Carlisle-based H&H Insurance Brokers.
As a direct result of the high value of the livestock, insuring pedigree animals has become an extremely specialist business.
However, many farmers still don't realise exactly what their insurance covers and whether their policies will be enough to replace like with like in the event of problems.
"Pedigree livestock insurance can be a complex business, but it's vital to ensure you have the right policy to cover your animals, and importantly, you know exactly what it covers," Carol added.
Carol is heading up the new in-Livestock division of the agricultural insurer, which has been launched to meet demand from custom-ers seeking specialist advice and policies to protect their valuable investments.
Initially concentrating on pedigree cattle and sheep, in-Livestock is backed by a team of underwriting staff with expertise in the sector, and decades of experience from parent group Harrison and Hetherington, which operates seven livestock auction marts in the North and the Scottish Borders.
The division is able to provide cover for breeders at key breed society auctions and insure private sales of top quality animals.
Carol said: "The nature of different breeders' and farmers' businesses means that there is no one-size-fits-all cover, and it's important to organise a bespoke policy to protect your valuable animals.
"With pedigree animals, it's all about their reproductive performance, so insurance covering the conditions of sale if the animal fails to fulfil can be just as important as policies for death by accident, illness or disease."
Carol advises pedigree breeders and keepers to find out exactly what their current policies cover and then check whether they are adequate.
Policies injury cover Under a Farm Combined Policy, animals are covered as standard for death or damage by fire, lightning, aircraft, explosions, earthquakes, impacts, electrocution, theft, fatal injury, transit and worrying.
from your but if you pedigree isn't sufficient However, not all policies automatically cover unexplained losses, such as when a cow wanders into a wood and its body is not recovered, or a sheep is swept into a watercourse by flooding.
"Policies for fatal injury generally just cover incidents away from your premises but if you have pedigree stock, this isn't sufficient," Carol said.
"You can extend your policy to insure for fatal injury on your own land, such as snow bringing down a building's roof, and to cover worrying by vermin such as foxes in addition to dogs."
By taking out a Specified Livestock Policy, both breeders and buyers of valuable animals are covered for additional aspects that Combined Farm Policies generally do not specify.
Infertility in a pedigree animal is an important aspect to cover, and this is generally known as Vendors Guarantee insurance.
Such policies can also cover All Risks of Mortality and Loss of Use, which provide payments if a pedigree animals dies due to an accident, illness or disease, or cannot work after an accident.
"For pedigree cattle and sheep, a Specified Disease Policy is also a useful insurance to have," said Carol. "This covers keepers for losses due to TB, Brucellosis and Foot & Mouth and will pay out a set amount, usually 25%, of the ministry compensation.
"It provides vital financial help if a pedigree business is wiped out by disease."
One of the major issues pedigree livestock breeders and keepers face with a Combined Farm Policy is that many have a single animal limit - typically PS5,000 or PS10,000 - which can be inadequate for a pedigree herd.
Carol added: "We are also seeing issues with how people work out the overall value of their livestock.
"A common mistake is to assume that as beasts are not all housed in the same shed, then the sum insured should only represent the maximum amount in any one shed or at any one location.
"As underwriters take this into account when assessing the risk, the sum insured should represent the maximum value of the stock in a 12 month period. Also, it's important to look at your policy's terms for reporting times if you are insured for veterinary fees.
fatal generally just "Most will have strict claims terms such as reporting within a set time and appointing a vet at the earliest opportunity. A vet's certificate and a valuation will also need provided in supporting evidence of the claim."
incidents away premises have stock, this BUSINESS Interruption Insurance is often part and parcel of Combined policies for dairy farmers, in case milk production stops due to a disaster such as a fire.
Carol Rickerby Again, for those with pedigree animals, however, it may be worth taking out a separate policy, and also looking at the length of time the insurance will provide cover for a business interruption.
Carol said: "Many farmers only insure for 12 months but it is strongly recommended to take out a minimum of 24 months to adequately protect the business from a large loss. As these policies only operate following specified perils, care should be taken that all contingencies required are taken.
"Disease covers are not available under this type of policy and should be insured separately if required. Finally, don't forget working dogs as these can be costly to replace.
"They can be covered either for specified perils under a farm combined policy or for all risks of mortality under a separate policy."
H&H Group plc was founded over 140 years ago, originally as farmstock auctioneers.
H&H Insurance Brokers is one of its seven operating companies, providing independent advice on all aspects of business insurance.
For more informational about the specialist cover offered by in-Livestock, visit www.in-Livestock.co.uk or contact Carol Rickerby on 01228 406290 or 07703 672337.
Policies for fatal injury generally just cover incidents away from your premises but if you have pedigree stock, this isn't sufficientCarol Rickerby
From left, Rachel <BStamper, Caroline Neile and Carol Rickerby of the in-Livestock team
Top quality pedigree livestock can fetch high prices, but can be extremely expense to replace if not covered by insurance
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|Publication:||The Journal (Newcastle, England)|
|Date:||Nov 22, 2014|
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