7 June 2002



Reducing accident risks on

dairy farms can cut

insurance premiums, as

well as making them

safer places to work, as

Suzie Horne finds out

CLAIMS for accidental electrocution of cattle in buildings are surprisingly common, say insurers, often involving the loss of perhaps 50 or 60 head in a single claim.

Common causes are electrical circuits earthing into water pipes and other steel parts of the building.

"This highlights how important it is to keep electrical installations well maintained and to run regular checks as part of a risk reduction programme. The combination of a high humidity environment and use of water and electricity together is also a great danger to staff," says Tim Price, spokesman for NFU Mutual.

Stock is also fairly commonly lost to lightening strike, although in smaller numbers. This has a regional bias, tending to occur on high ground, such as the Peak District, in hot weather. Under NFU Mutuals business combined policy, loss of stock to electrocution or lightning is automatically covered, but different insurers provide different types and levels of cover, say advisers.

Straying stock is another common cause of insurance claims. Cover for fatal injury to straying stock is usually optional and needs a body to be recovered, but some insurers also pay when they disappear in other circumstances, such as in floods.

Liability cover

Where animals stray and cause damage or injury, the farms liability cover will pay for injury or damage to third parties. The highest value claims of this type usually relate to motor accidents.

Crop damage by animals straying on to a neighbours land would be covered, but on the farm to which the stock belongs, it would not. However, in more than half of cases of straying stock, it is walkers or other members of the public at fault, says Nigel Wellings of insurance consultant Farmers & Mercantile. "These claims are often linked to fields with rights of way. But stock get out and once they are out the producer is strictly liable for them."

With traffic volume and speed on rural roads increasing, moving stock on a public highway is increasingly difficult and dangerous. As well as potential for injury to stock, there are third party claims here too. Producers can protect themselves to some extent by ensuring that they and their staff take precautions, including having enough people on hand when stock are being moved and using signs where appropriate.

Milk claims

Milk collection and milk quality are sometimes the subjects of claims. When antibiotics are discovered in milk causing rejection by the dairy, cover is not usually available for the loss of the value of that milk, although dairies often pay a small price/litre for it.

Of greater concern is the potential for a contaminated whole tanker or even a bulk tank of milk at the dairy. This could result in a damages claim under the farms product liability cover.

This type of insurance is common, since traceability became such an important part of food supply. It covers damage caused by a producers primary agricultural product further down the line, at a processor, in the supermarket or even after consumption. Most producers have product liability cover automatically included with their public liability insurance, but about 10% do not, warns Mr Wellings.

Any producers with policies not been reviewed in the past couple of years should ensure they have product liability cover, he advises. "Dairy contracts usually require it."

It is also possible to insure for loss of income on uncollected milk, when tankers cannot get to the farm in bad weather.

Where damage to a bulk tank or parlour puts equipment out of use until repair or replacement and the cause is an insured risk such as fire, storm or impact, then the insurance will usually cover the cost of repair or replacement. Breakdown insurance on the tank and its associated equipment is also available.

When an essential piece of equipment is put out of action by an insured risk, the aim will be to minimise loss, so a temporary parlour could be brought in or the herd milked through a neighbouring parlour.

"Where a parlour is out of action because of an insured event, the loss of income is often a greater loss in financial terms than the cost of rebuilding the parlour," says Mr Price. This can be protected by business interruption cover, also known as loss of income cover. NFU Mutual estimates that about one-third of dairy farmers have this type of cover.

Different terms

Different insurers may refer to this type of cover in different terms, so producers must be careful to check exactly what they are buying, say consultants. Loss of income cover is always linked to an insured property risk such as fire and the events must always be named.

With the silage season upon us, insurers will be dealing with a number of claims for internal damage to forage machinery caused by foreign bodies entering the machine. This is usually purely accidental, but can cause disruption to the silage operation as well as the expense of repairs. Many foragers now have metal detectors, but mowers are particularly susceptible. The farm would have comprehensive cover for his own machinery and any attached implements, but it can get more complicated when it happens to a contractors equipment. &#42

Using the right equipment for stock tasks can reduce injuries, and insurance claims.

NFU Mutuals David Leavesley encounters the same hazards again and again, many of which could be simply and effectively tackled:

&#8226 Electrical appliances These should be tested and checked by a competent contractor at least once every five years or three years in a hazardous environment such as a parlour. Portable equipment should be checked by sight every time it is used and tested every two years under the Electricity at Work Regulations 1989.

&#8226 Chemical handling Are staff properly trained in handling chemicals? Is protective equipment available and do you ensure that it is used?

&#8226 Stock handling The right equipment used on all farms would reduce the number of injuries from kicking, trampling and crushing each year. It also makes routine jobs such as foot trimming easier and quicker.

&#8226 Waste management Insurance will only pay for pollution which is sudden, accidental and unpredictable. Forgetting to check or move the irrigator does not count. Fuel oil storage on dairy farms is also often not up to scratch.

&#8226 Machinery Dairy farmers usually keep their cows in excellent condition, but this sometimes means that their machinery is not. PTO guards are often poor or missing and tractor indicators often obscured by muck.

&#8226 Manual handling Proper training and risk assessment must be done. What are you asking your staff to handle and lift? Do they have the right kit and do they know how to do it safely?

&#8226 Food safety Have you thought about the potential for milk contamination? Have the right checks and training been done to minimise that risk? Is full traceability possible?

&#8226 Public liability When public is on your farm, what risks do they face? Public footpaths provide one of the highest risk areas, particularly where stock graze. Bulls should not be put in fields with public access and use warning signs.

See more