Insuring your smallholding - what you need to know

Many people have become smallholders by accident – property owners with large gardens or adjacent land on which they’ve chosen to keep a few animals, grow crops or store agricultural equipment in outbuildings.

In such cases, the distinction is often not made between domestic animals and livestock or between agricultural machinery and garden tools. What they regard as a ‘domestic hobby’ is often not seen as being an ‘agricultural activity’.

Consequently, these accidental smallholders will often wrongly assume that their domestic buildings and contents policies will cover all their liabilities – this can prove a costly mistake.

It is essential that appropriate cover is in place, through a smallholders or small farm insurance policy, to avoid risking unnecessary financial loss.

So what do you need to know when insuring a smallholding? Here, we share 3 top considerations.

1. Go bespoke
Although there are a lot of ‘off the shelf’ packaged policies available, everyone’s circumstances are unique, and we would recommend speaking to a specialist to ensure that cover is watertight – that areas of cover are comprehensive in relation to need and that sums insured are adequate for the replacement or reinstatement of buildings and equipment as new.

2. Make your insurer aware
Ensure your insurer is aware of ALL activities taking place on the land in question.

The risks of having gaps in cover, or of being underinsured, can increase where diversification has led to a range of small business ventures, from camping and craft courses to bed and breakfast enterprises. This is because smallholding policies are unlikely to cover the liabilities associated with such activities as standard.

Under these circumstances, flexibility is key with bespoke policies from specialist insurance brokers that can assess the risks and offer genuine consultancy advice on the recommended route to financial protection, should misfortune ever come knocking.

It is also important to tell your insurer if you receive any income from the smallholding.

3. Got help? Get Employers’ Liability
Employers’ Liability cover is a legal requirement if you receive any help in running a smallholding, irrespective of whether the help is paid or unpaid, employed or self-employed – if they are acting on your instruction, you need cover.