If you operate a farm, you already know farm work would be near impossible without access to a reliable truck. It’s used to haul material, water crops, transport workers and is one of the most valuable assets a farmer owns.
You also know how important it is to maintain and protect the most valuable assets but what you may not know yet is the best way to insure your trucks under the correct designations.
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WHAT’S THE DIFFERENCE BETWEEN A FARM TRUCK AND A PERSONAL TRUCK?
A farm truck is a truck used specifically for work on the farm (i.e. hauling materials) and intended to remain on the farm property full time. A personal truck can be used for work on the farm but is also used off the farm for personal trips (i.e. family outings, shopping).
IS FARM TRUCK INSURANCE CHEAPER THAN PERSONAL TRUCK INSURANCE?
Yes.
Due to the usefulness and importance of a farm truck, you may assume it would be more expensive to insure. In reality, if it’s a true farm truck and not a personal truck that gets used on the farm sometimes, the cost for truck insurance is usually lower.
When dealing with a farm truck the coverage required is for the actual cash value of the truck itself. Since it’s not taken on public roads there is significantly less liability risk to worry about so the cost to insure the farm truck is almost always less than the cost to insure a personal truck.
DOES HAVING FARM PLATES ON YOUR TRUCK AUTOMATICALLY MAKE IT A FARM TRUCK?
No. While there are several important benefits of farm plates, being a deciding factor as to whether or not the truck qualifies as a farm truck is not one of them.
The way a truck can be classified as a farm truck and receive the reduced farm commercial insurance rate is for it to remain on the property of an active farm and for it to be used for farm-related work.
Something else important to note is that if a farm only has 1 vehicle/truck it cannot be classified as a farm commercial truck because it’s assumed that it is also used for pleasure purposes off the property. The farm commercial truck insurance rate usually applies to a farm second (and third and fourth) truck that is specifically used for on-farm duties only.
When discussing insurance options for the vehicles used on the farm the most important question you will be asked above all others is “what is the vehicle used for?”
Erie Mutual Insurance proudly serves the commercial insurance, farm insurance, home insurance and auto insurance needs of members throughout Southern Ontario including Haldimand, Niagara and Hamilton.
Please don’t hesitate to contact us with any questions you may have about this or any other topic related to your insurance.
