Hey Neighbor, can I borrow.........

Borrowed Farm Machinery

Farming requires a fair amount of skill and expertise. The same goes for the machinery involved. When situations arise that result in the loaning or borrowing of heavy equipment—whether for financial reasons or simply a neighbor trying to help out in a time of need—it’s important to consider the financial implications if something were to go wrong. Here are some questions to consider before sharing equipment.

What type of coverage do I need for my farm operation if I plan to borrow or loan equipment? Before borrowing or loaning equipment, we recommend speaking directly to your insurance agent to confirm if proper coverage is in place. Coverage on farm machinery borrowed by an insured person for farming purposes has the same type of coverage as your own farm machinery and totals $10,000. This amount can be adjusted by purchasing additional coverage to fit the needs of your operation.

Pro Tip: Coverage for farm equipment and machinery comes from the owner’s policy first. The borrower’s coverage is considered excess coverage. Talk to your agent for more information about how coverage applies in the event of a loss. Do I have coverage for machinery loaned out to others? Yes, you have the same coverage on your machinery whether you are using it, or it is being used by another farmer that you have loaned it to. Understanding common insurance terms such as “replacement value” or “actual cash value” can help you determine how much insurance coverage is needed for your operation—both as a whole and for individual pieces of equipment. For example, if you were to loan out an ATV and a combine, the coverage needed would be different because of the value of each piece of equipment. There are several ways to insure your own equipment. Speak to your agent to find the right fit for you.

Mobile Agricultural Machinery and Equipment Coverage

Scheduled Farm Personal Property

Blanket Farm Personal Property

Pro Tip: Providing an equipment inventory list to your insurance agent and by whom the equipment will be used will help them tailor coverage to the needs of your operation. If I were to loan out equipment, can my operation function without it? If an accident were to occur and you lost the ability to use a particular piece of machinery, would your operation take a financial hit in terms of production? Take time to run an audit of all the processes that may involve this piece of machinery in the n

ext 6 to 12 months. Doing so may help determine whether it’s sensible to loan out your equipment. If a loss does happen, your agent can help you get the coverage you need for temporarily leased machinery and equipment used while yours is inoperable. Farmers Mutual of Nebraska understands the value of people helping one another. The borrowing and loaning of equipment is often necessary for operational success. Together with your local agent, we’ll create a Farm & Ranch Insurance policy customized to your needs. Contact your local agent for a quote today.