Livestock Insurance
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The Hartford Financial
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Services
Livestock
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Disclaimer
Insurance forms and endorsements vary based on
insurance company; changes in edition dates;
regulations; court decisions; and state jurisdiction. This
instructional materials provided by Insight is intended
as a general guideline and any interpretations provided
by the instructor or the creator(s) of this material do not
modify or revise insurance policy language. In
providing these materials, the authors assume neither
liability nor responsibility to any person or business
with respect to any loss that is alleged to be caused
directly or indirectly as a result of the instructional
materials provided.
Copyright 2010 – 2013 All Rights Reserved
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Your Instructor Today
Mike Sergeant , AFIS
Sales & Service Director, The Hartford
Financial Services Livestock
Sponsored By:
The Hartford Financial
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Services
Livestock
Polling Question #1
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Topics Covered
 Background on Livestock Insurance
 Specific types of Livestock Insurance
 Mortality Insurance
 Pasture Insurance
 Feedlot Insurance
 Dairy Herd Insurance
 Auction Market Insurance
 Transit or Cargo Insurance
 Import/Export Insurance
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Exposures to Loss
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At “scheduled” locations
At “un-scheduled” locations
On pastures or grazing land
At an auction yard
While in transit
During loading or unloading
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Background on Livestock
Insurance
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Polling Questions #2
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Background on Livestock
Insurance
 Livestock is available under most Farm
Package Policies
 Livestock may be scheduled or included
under “property” in the form
 Caution:
 Review values carefully
 Farm Policies have limited values which
may not cover the Livestock owner’s
exposures
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Background on Livestock
Insurance—Definition of Terms
 Purebred/Registered
 The animal is registered with a Breeed
Association and its bloodlines are recorded
 Stocker
 A non-registered animal used for breeding or
dairy purposes
 Feeder
 A non-registered animal being fed for eventual
slaughter intended to enter the food chain
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Background on Livestock
Insurance—Definition of Terms
 Feedlot
 A lot or combination of buildings
intended for confined feeding and
raising of livestock using supplemental
feed sources
 Pasture
 A confinement area where grass or
crop residue is used for livestock
grazing
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Background on Livestock
Insurance—Definition of Terms
 Current Market Value
 The average market value for Feeder or
Stocker livestock as determined at the
nearest applicable market or as
published by the USDA price reporting
service
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Background on Livestock
Insurance—Definition of Terms
 USDA
 The United States Department of
Agriculture which is the governing
authority over all Agricultural related
affairs within the US
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Mortality Insurance
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Polling Question #3
Which of the following is a Covered
Cause of Loss on a Mortality Policy?
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Mortality Insurance
 This type of insurance is basically a type
of Term Live type of coverage for Horses,
Cattle and Dogs
 The animal is insured against Death (or
Destruction for humane purposes) which
may occur during the policy period.
 Covered causes of Death include
“accident”, “Illness” and “disease”.
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Mortality Insurance
 Additionally the policy contains the
“hazards of transportation” anywhere in
the U.S. and Canada.
 Particular attention should be given to
insurance company definitions of these
coverage terms.
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Mortality Insurance
 Rates for Mortality Insurance vary
depending based on the use, age and
value of the animal being insured.
 A veterinarian exam is usually required by
the insuring company prior to accepting
the risk.
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Mortality Insurance
 Most insurance carriers will accept a
“Statement of Health” which is completed
by the owner of the animal provided that
the animal has been under the owner’s
care for more than 30 days.
 Livestock insured on a Mortality Policy are
usually higher value “Registered or
Purebred” animals whose loss would
cause economic hardship to their owner
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Mortality Insurance
 There are several endorsements available
on a Mortality Policy offered for an
additional premium. They may include:
 Surgical Coverage;
 Major Medical Coverage;
 Loss of Use:
 Limited Loss of Use;
 Emergency Colic Surgery and Breeding
Soundness Coverage.
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Pasture Insurance
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Pasture Insurance
 This coverage provides protection to
livestock (usually cattle) that are put on
large expanses of pasture land to graze
prior to being moved to a feedlot.
 In the west, pasture land can consist of
several thousand acres and usually
involve leases of BLM (Bureau of Land
Management) land.
 In other areas pastures may consist of
less than 20 acres.
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Pasture Insurance
 Coverage under this type of insurance is
available for one of three policy periods:
 Annual 12 month policy,
 Winter Policy ( Oct. 1 through April 30th)
 Summer Policy (May 1st through Sept.
30th).
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Pasture Insurance
 Coverage is usually written as Specified
Perils wherein the policy insures the
livestock for “Death Only” when caused by
a Specific Peril.
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Pasture Insurance
Most policies provide perils including
 Fire, Lightning,
 Vandalism or Malicious
Mischief,
 Drowning,
 Attack by Wild Dogs or  Theft (Excluding
Mysterious
Animals,
Disappearance),
 Electrocution by
 Animal Collision
Artificial Means,
 Smothering Directly
caused by a blizzard or
snowstorm.
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Feedlot Insurance
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Feedlot Insurance
 Feedlot Insurance is similar in nature to
Pasture Insurance.
 The coverage protects Livestock which is
in a confined area which are being fed
grains and supplements.
 This type of operation is usually a situation
where the cattle are being fattened and
will be sent to slaughter to become steaks
and hamburger at the local supermarket.
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Feedlot Insurance
Most policies provide perils including
 Fire, Lightning,
 Vandalism or Malicious
Mischief,
 Drowning,
 Attack by Wild Dogs or  Theft (Excluding
Mysterious
Animals,
Disappearance),
 Electrocution by
 Animal Collision
Artificial Means,
 Smothering Directly
caused by a blizzard or
snowstorm.
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Feedlot Insurance
 Typical perils NOT insured on the policy
 Grazing
 Lagoon, stagnant or flood water
 Contamination from sources other than
feed or water
 Errors in mixing of feed
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Feedlot Insurance
 Limits of insurance will usually be written
at “Current Market Value” and may have a
Maximum Limit per Occurrence.
 Feedlot operations are spread throughout
the United States but the larger ones are
concentrated in the states of Texas,
Kansas, Oklahoma and Nebraska. These
are prime areas where weather conditions
can pose a serious threat to Livestock.
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Dairy Herd Insurance
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Dairy Herd Insurance
 Dairies are similar to feedlots since they
usually consist of cattle that are in a
confined area and fed grains and
supplements.
 The difference is that in some areas, Dairy
cattle are housed in enclosed structures
while in the Southwest and warmer
climates the cattle are kept in pole barns
with fans and misters to keep them cool
and comfortable
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Dairy Herd Insurance
 In this situation insurance coverage is for
ordinary Dairy cattle and can include
Milking Cows and Heifers as well as dry
cows.
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Dairy Herd Insurance
Most policies provide perils including
 Insurance protection is against Death or
Destruction for humane purposes following a
Specified Peril.
 In addition coverage is provided for the Specified
Perils including: Fire, Lightning, Drowning, Attack
by Wild Dogs or Animals, Electrocution by
Artificial Means, Vandalism or Malicious Mischief,
Theft (excluding mysterious disappearance)
Animal Collision and Smothering Directly caused
by a blizzard or snowstorm.
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Dairy Herd Insurance
 Dairy cattle values tend to fluctuate with
the price of milk, however, keep in mind
that the average Dairy Cow has a life span
of 5-7 years and depending on the butter
fat content of her milk, she can be difficult
and expensive to replace should a loss
occur.
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“Contaminated Feed & Water”
Endorsement
 An endorsement for Feedlot and Dairy
Herd Insurance
 What this additional coverage form offers
is protection for Death of the Livestock
when caused by a Contaminant in the
food and water supplied to the cattle.
 It is a Death Only coverage and can be
purchased with a choice of Limits and
Deductibles to fit each individual situation
that Feedlot and Dairy owners may
require.
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“Contaminated Feed &
Water” Endorsement
 This endorsement has been an important
addition to coverage’s in the West and is
spreading throughout the United States.
 This insurance is rapidly becoming a Bank
Loan requirement for larger facilities.
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Auction Market Insurance
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Polling Question #4
Have you visited a Livestock Auction,
Feedlot or Dairy in your area
recently?
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Auction Market Insurance
 Prior livestock forms death with cattle that
was being raised either on a pasture near
a farm or ranch or in a confined area such
as a feedlot or dairy
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Auction Market Insurance
 This coverage is usually written for the
owner or owners of a Livestock Auction
Facility.
 In most cases these types of operations
include buildings and pens which hold the
livestock prior to and after the sale along
with a Sale Ring where the animals are
bid on by interested buyers.
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Auction Yard Coverage
 Typical “premises” forms do not
include auction yard locations
 Transit forms cease when the
transportation of livestock ends
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Auction Market Insurance
 Auction Market owners are responsible for
the Care, Custody and Control of the
livestock when on their premises.
 With Auction Market Insurance there is
usually no deductible and livestock are
insured for their “Current Market Value”.
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Auction Market Insurance
 There are three broad categories of
exposures/coverage
 Yard Coverage
 This insures the animals received on
the premises and protects against loss
to the Livestock while kept in the Yards
resulting from Specified Perils such as
Fire, Windstorm or Tornado,
Electrocution, Hail & Theft while on the
premises up to a period of 10 days.
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Auction Market Insurance
 Accidental Death & Crippling while in the
Yards
 This protects the animals from the
hazards of crippling or even death while
being moved through the alleys, pens,
sheds & barns of the Auction Market
facility.
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Auction Market Insurance
 Mortgage & Theft Coverage
 This is a protective measure for the Auction
Market business
 It is written to protect the Auction Market itself
from being held responsible for selling cattle
that have a Mortgage on them and are sold
through the Market but the Lender never
receives payment for their monetary interest or
mortgage that they hold on the livestock.
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Auction Market Insurance
 The coverage’s are usually written as a
monthly reporting type of Policy. The
Auction market reports monthly gross
sales and pays a percentage of those
sales as premium for all three of the
protective coverage’s offered.
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Livestock Transportation
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Polling Question # 5
Do you work with Commercial Truckers who do
long haul or may have occasion to haul
livestock?
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Transportation
 Perhaps one of the greatest exposures
that cattle have to loss and one which
occurs on a daily basis throughout the
U.S. is exposure to Death or Injury while
being transported.
 The usual mode of transportation is a
specially designed livestock trailer which
can be partitioned to separate large and
small animals.
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Transportation
 A Farm Auto Policy may be written to
include Livestock which is owned by the
insured and transported via a gooseneck
trailer or Farm truck.
 Caution: be sure to read the Farm Auto
Policy to be sure that coverage under this
form is not limited to only Dead livestock
which is involved in an accident.
 Check that limits per head follow the
changing livestock market values.
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Transportation
 There is Transit/Cargo Insurance
specifically written to cover livestock which
is being transported either by the Farmer
or Rancher himself or by a Commercial
Livestock Hauler who makes his living
moving cattle across the country.
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Transportation
 Two forms of stand alone Livestock Cargo
Insurance are currently on the market.
 Transit Limited Coverage
 this type of insurance is Limited to the
Specific Perils of Fire, Lightning,
Collapse of Bridges or Culverts and
Collision or Upset.
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Transportation
 What is unique to the coverage is that should a
loss occur due to a covered specified peril
 The insurance is expanded when compared to a
Farm Auto Policy to include Dead and Crippled
Livestock.
 In some cases it also will pay for Round up fees
to gather the cattle following a Specified loss and
will purchase the entire load of Livestock should
the shipper deny the balance of the load of cattle.
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Transportation
 Transit/Cargo Insurance is a Broad Form
Transit Policy.
 This form is expanded to include not only
the perils of Fire, lightning, Collapse of
Bridges and Culverts and Collision or
upset but it also provides coverage for
livestock which is basically being
transported down a road and suddenly is
jostled and gets down in the trailer and is
killed or crippled.
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Transportation
 The policy states in essence that “if the
Livestock is loaded in good condition it will
be unloaded in the same, like condition”.
 Premium for this type of coverage can be
expensive but it does provide the most
extensive coverage for the Livestock
hauler.
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Import/Export Livestock
Insurance
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Import/Export Livestock
Insurance
 Import and Export Insurance for Livestock is an
ever broadening opportunity in today’s
Agricultural World.
 There are some businesses dedicated to
providing services to assist in the Import or
Export of Livestock known as “Freight
Forwarders”.
 There are also individual Livestock breeders
who wish to improve their current stock of
breeding animals and actually travel to
European Countries to contract for Bulls and
Cows to add to their herd.
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Import/Export Livestock
Insurance
 When writing this type of Insurance it is
recommended that as much information
as possible be gathered at least 3 to 6
months prior to shipping of the Livestock.
 Information to be noted are:
 Where are the Animals being shipped
from?
 Where are they being Shipped to?
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Import/Export Livestock
Insurance
 How are the animals being shipped?
(the most common way is via air but
there are still shipments of livestock
that cross the oceans on a weekly
basis)
 Are the animals being shipped bred ?
 If they are bred how close to full term
are they?
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Import/Export Livestock
Insurance
 Is there a quarantine period required
either prior to shipping or when they arrive
at their destination?
 Is transportation from the airport or dock
also needed to get the cattle safely to their
final destination?
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Import/Export Livestock
Insurance
 Types of coverage offered with Import/Export
Insurance includes:
 Death and Crippling of the livestock while in
transit, be it via ship or plane.
 Protection for the Livestock while in
Quarantine prior to shipment.
 Protection for the Livestock while in
Quarantine after arrival at its destination
 Transit/Cargo coverage for trucking to the final
destination if needed.
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