Do I Need Tractor Insurance?

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Owning a tractor is a significant investment but it also involves big risks. Tractors are powerful and expensive machines that can cause severe damage or injury during an unfortunate event.

To mitigate these risks, tractor insurance is an option to consider. However, the question arises whether you actually need tractor insurance or not.

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To answer this question, here is a brief guide that explains what tractor insurance covers, who needs it, and where to find it.

Is Tractor Insurance Mandatory? 

Tractor insurance, along with insurance on other farming equipment, is not mandated by state laws, unlike car insurance.

However, if you have taken out a loan to buy your tractor, most loan providers will require you to have tractor insurance until you have paid off the loan.

Does My Home Insurance Cover My Tractor?

It’s possible that tractors with less than 25 horsepower may be covered by your home insurance policy. However, it’s essential to confirm with your agent to ensure that it’s accurate.

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Tractors with higher than 25 or 30 horsepower, on the other hand, typically aren’t covered by a home insurance policy or personal liability rider.

This implies that you could be responsible for expensive repairs or full replacement if your tractor is damaged due to an accident, disaster, vandalism, or theft.

This coverage gap also means that if you unintentionally cause damage or injury to someone while driving the tractor or run into a neighbor’s fence, you’ll have to pay for any expenses out of your pocket.

Who Should Get Tractor Insurance? 

Your tractor is a powerful machinery that is crucial for its efficient performance. However, it can also cause severe damage due to its immense power.

Shockingly, tractor rollovers account for 44% of work-related deaths on farms. Moreover, repairing a damaged tractor can be a costly affair.

To protect yourself from massive out-of-pocket expenses that come with costly repairs or liability lawsuits, tractor insurance is crucial.

It is especially important if your tractor is over 25hp and you are uncertain if you can afford the repairs or damages out of pocket. 

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What Does Tractor Insurance Cover? 

Tractor insurance provides protection against damage and liability caused by various types of events. You can opt for a blanket policy that covers your entire equipment up to a specific amount or insure individual equipment parts that have their own value.

It is important to note that both policy types typically include coverage for the following, but it is advisable to review your specific policy:

Accidents. If your tractor is damaged during a rollover or collision with another vehicle or outbuilding, costs to repair your tractor are usually covered. 

Theft and vandalism. If your tractor is stolen or vandalized, your policy generally covers the cost of replacement or repair up to a specific amount. 

Repairs. In some situations, depending on your policy, repairs that must be made as a result of specific conditions or incidents may be covered.  

Personal liability. If you damage a neighbor’s fence or driveway, your policy will generally cover your personal liability for that damage, up to a certain amount. 

Add-ons for specialized coverage. Many insurance companies offer add-ons for specialized coverage. This could include coverage for acts of terrorism.

How Much Does Tractor Insurance Cost? 

The cost of insuring your tractor will depend on its overall value. Typically, you can expect to pay around $5-7 per year for every $1,000 of value your tractor holds.

For instance, if your tractor’s value is $30,000, then you may have to pay between $150 and $210 per year on insurance.

However, the precise cost of insurance may differ based on various factors such as your geographical location, the amount of coverage you need, and the type of policy you opt for, or any additional benefits you choose.

Apart from this, most policies also come with deductibles, which means you will have to pay the first $500 or $1,000 worth of damage before the policy kicks in. The higher deductible you choose, the lower your yearly premium will be.

How Do I Get Tractor Insurance?

It’s a good idea to reach out to your local Farm Bureau office for suggestions on reputable agents who offer tractor insurance in your area.

Other national insurance providers such as American Family Insurance and Nationwide also provide tractor insurance coverage. Additionally, your home insurance provider may have recommendations for local insurance providers.

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