Is There a Difference Between Hobby Farm Insurance and Commercial Farm Insurance?

When it comes to protecting your farm, choosing the right insurance policy is just as important as selecting the right equipment or crops. Whether you’re raising a few chickens in your backyard or managing acres of farmland, the type of insurance you need depends on the scale and purpose of your operation. Two common options—hobby farm insurance and commercial farm insurance—offer different levels of coverage tailored to different farming lifestyles. Understanding the distinctions between these policies can help financially protect your property, assets and livelihood.

Insurance for Different Types of Farms

Hobby farm insurance is designed for individuals who operate small-scale farms primarily for personal enjoyment or supplemental income. These farms typically have limited acreage, a few animals and small crop yields. The insurance coverage often extends from a homeowner’s policy, offering protection for outbuildings and equipment, as well as limited liability related to farm activities. It’s ideal for those who sell produce at local markets or keep animals as a pastime rather than a primary source of income.

In contrast, commercial farm insurance is tailored for full-scale farming operations that function as a primary business. This type of insurance offers broader and more robust coverage, including financial protection for large-scale equipment, multiple employees, extensive crop and livestock operations and business interruption. It can also include higher liability limits and may cover specialized risks such as pollution liability or agritourism activities.

The key difference lies in the scale and intent of the farming operation. Hobby farm insurance is more affordable and less complex, but it may not offer sufficient protection for larger or income-dependent farms. Commercial farm insurance, while more expensive, is essential for safeguarding the financial stability of a professional farming enterprise.

Learn More

For farm insurance near you, contact Don Ramatici Insurance.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.