In Chris LeDoux’s seminal classic “Cadillac Ranch,” our family farm-owning heroes save their land from foreclosure by converting the farm into a club with a bar in the barn, cars parked in the old pea patch, and the narrator and his brother playing guitars for the guests. And while it would be a genuine party foul to bring up the need for liability insurance in the middle of the song, it is in point of fact the first thing to consider when planning a side venture into agritourism.
Agritourism represents a great way for producers to increase revenue while celebrating the rural lifestyle. And as urban sprawl into suburbia continues at an alarming pace, landowners throughout the country are finding these potential side-lines more and more attractive. But before you follow the path from row-cropper to corn maze operator, make sure to perform due diligence in terms of risk. Even the smallest producer carries some type of liability insurance for their operation, but does this policy cover agritourism?
The answer is, probably not. And this is why experts advise anyone considering a foray into these endeavors to consult with their insurance agent and consider a special rider specifically addressing agritourism.
What is agritourism insurance?
Agritourism is broadly defined as any “commercial enterprise at a working farm, ranch, or agricultural plant conducted for the enjoyment of visitors that generates supplemental income for the owner. This can include:
- Outdoor recreation (Fishing, hunting, horseback riding)
- Educational (Cooking or beekeeping classes, wine tasting)
- Entertainment (Races, festivals, dances)
- Hospitality (Bed-and-breakfast, guided tours)
- Farm-direct sales (U-pick operations, on-site markets)
It doesn’t take too vivid an imagination to come up with potential liabilities for any, or all, of the above. From bee stings and bumps on the head, to life-and-limb tragedies involving tractors and wagons, keep in mind the folks visiting your operation aren’t friends and families, and are most likely unaccustomed to the everyday dangers of equipment and livestock. If firearms and boating are involved, such as would be the case in a hunting or fishing enterprise, the need should be even more apparent.
Agritourism insurance refers to a customized rider that amends liability coverage beyond the normal activities of a farming operation. Depending on the scope and scale of the program being offered on the property, consider the number of strangers who will be traipsing about the property consuming food and beverages. As a general rule, consider that no coverage exists within your liability policy unless specifically stated as such, and there might even be language that prevents you from performing non-farming activities.
Some states have enacted specific immunity laws for some agritourism activities, but no such statute can provide absolute immunity from a hungry lawyer. Be sure to check with your agent about options for coverage. As with all insurance, the premium and policy will vary widely depending on any number of factors:
- Types of activities
- Expected attendance
- Season and hours of operation
- Whether or not food and alcohol are involved
- Background of the individuals obtaining the insurance
As with all businesses endeavors, forewarned is forearmed. Yet most agritourism ventures grow slowly out of a small hobby, and the proprietors might simply never think to consider their insurance coverage when expanding. Ninety-nine times out of a hundred this might work out fine, but it only takes one accident to wreck and operation.
Before approaching your agent, be prepared to answer questions about basic safety and risk strategies involved in your proposed operation. Consider what plans you’ll need in place in case of emergency. Should guests be instructed on specific clothing to wear? Where will visitors park their vehicles? Keep in mind that this might be the first time your guests have ever set foot on a farm. Tractors and ponds draw children’s attention like flies to honey, and again, no one ever expects an accident.
Whether a dairy farmer opening their operation up for tours, or a conventional row-cropper expanding into a winery, it’s all too easy to overlook the need for coverage while making the jump from hobby to full-blown business. But imagine the irony of Chris LeDoux’s heroic family farmers saving their “Cadillac Ranch” only to lose it in a bankruptcy case due to lack of an agritourism insurance policy. The best way to keep our country from singing the blues is to be prepared in advance.
Brian Boyce is an award-winning writer living on a farm in west-central Indiana. You can see more of his work at www.boycegroupinc.com.