How to Get Insurance for Your Tractor

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Tractors are essential pieces of farm equipment. They make plowing, planting, and moving things around a farm much easier. Tractors are even used on construction sites. That is why so many farmers and other people who own tractors want to make sure their tractor is properly insured.

Where can you find tractor insurance? What do you need to consider when looking for a policy?

Do I Need to Insure My Tractor?

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Unlike car insurance, tractor insurance is not required by law. However, many tractor owners are required to have insurance by contract. When you take out a loan for an expensive item, the lender views the item you purchase as collateral. That’s why lenders often require tractor owners to maintain some form of tractor insurance for the life of the loan.

Even when not required by a lender, having tractor insurance is a wise choice. Tractors are expensive pieces of equipment that handle big jobs. If you do not have enough money to replace a damaged tractor sitting in your bank account, you need tractor insurance to protect your valuable asset.

While there’s very little risk of another tractor driver having a collision with you on your own property, there is certainly a risk of accidents with tractors. Rollover accidents are serious safety risks on a farm. Operator errors can also cause tractors to run into buildings, cars, or other property. There is also a risk of auto collisions if you drive your tractor on public roads, even for very short trips.

How Does Tractor Insurance Work?

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With any type of insurance, there are different types of coverage to choose from. Some companies offer repair coverage in their tractor insurance policies to help cover the cost of expensive repairs. A tractor insurance policy can also include coverage for liabilities, such as property damage or bodily injury in the event of a rollover accident or a collision.

Theft and natural disasters are additional major threats to tractors. Depending on the terms of the policy, tractor insurance may allow for more coverage of weather-related events than the average insurance policy for personal property. Specified perils coverage can be built into a tractor insurance policy. This can list out specific events to be covered that would not be covered otherwise.

Any individual insurance policy will be made up of different coverage options. So, knowing the specific coverages included and needed for your area is essential to getting appropriate coverage.

How Much Does It Cost to Get Tractor Insurance?

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The cost of tractor insurance varies greatly. Like any other form of insurance, the cost of a policy is relative to the value of the covered property. Some tractors cost around $25,000; other tractors can cost more than $100,000. The cost of a policy can also increase or decrease based on the policyholder’s driving record. If you have several accidents on your record, you will pay more than a tractor owner with a clean record. 

The deductible is another factor that can influence the cost of a tractor insurance policy. When damage happens, you pay the deductible amount before the insurance company will cover any of the expenses. Policies with lower deductibles are more expensive, whereas policies with higher deductibles cost more. Liability coverage is another variable. Similar to insurance for cars, you choose a liability coverage limit as part of your tractor insurance policy. The cost of the insurance policy rises with the amount of liability coverage. 

One of the biggest reasons for variance in the cost of one tractor insurance policy compared to another is the type of insurance policy you hold. Tractors can be covered under stand-alone tractor insurance policies. There are also farm insurance policies, with a blend of insurance for land, a home, and the equipment that is used on the farm. Other insurance policies specifically cover all farm equipment, including tractors. Some people choose to insure tractors under scheduled policies. This type of policy allows for the coverage of expensive assets that may not be adequately covered by the limits of other policies. Scheduled policies are usually the most expensive option.  

How to Apply For Tractor Insurance

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Especially in rural communities, there are plenty of smaller regional and local insurance companies that offer tractor insurance. On the national level, some of the most well-known tractor insurance providers are American Family Insurance, Shelter Insurance, Farm Bureau, and Nationwide. If you’re having trouble finding tractor insurance in your area, you may find helpful recommendations from tractor dealerships or agricultural trade associations. 

Some lenders who offer loans for tractors will have relationships with insurance companies. People who take out a loan for a new tractor can opt to have tractor insurance factored into the cost of their loan, and loan payments will cover both the loan amount and the insurance. If you choose this option, your coverage usually ends when you pay off the loan.

Tractors are a unique type of property. They may be stored on the same property as a person’s home. Some people use them for personal use, and others use them for business. In certain situations, a tractor may be covered by an individual homeowners insurance policy. Talk with an insurance agent about the exact terms of your homeowner’s insurance policy to see if it offers adequate coverage for your tractor. Even when homeowner’s insurance does cover a tractor, there are often very detailed stipulations about what kinds of use the insurance will cover and what costs it will cover. In general, you would be wise to purchase separate tractor insurance if employees use your tractor. 

Tractors are critical assets, so it is important to do your due diligence in finding a policy that will offer the right type of protection for your circumstances. Since there are so many significant variables when it comes to insuring tractors, some of the major tractor insurers do not have online quote options on their websites. Rather, they prefer those tractor owners speak with an agent to make sure they find the perfect policy for their situation.