Is Your Farm Equipment Covered? What Oregon Farmers Need to Know About Equipment Insurance
- Hailie Hillock
- 3 days ago
- 6 min read
Equipment is often one of the most expensive assets in a farming or ranching operation, and it’s one of the most commonly underinsured. A single tractor, combine, or hay swather can cost tens of thousands of dollars, and if something goes wrong, getting back to work quickly is a necessity.
This guide will help you understand how farm insurance works, what it covers and doesn’t, and what Oregon, Washington, and Idaho farmers should consider when protecting their machinery.
What is Farm Equipment Insurance?
Farm equipment insurance is a component of a farmowners policy that specifically protects the machinery and equipment used in your agricultural operation. This typically includes tractors, combines, tillage equipment, hay equipment, irrigation systems, and other machinery essential to your farm.
Coverage can be structured as a lump sum that applies broadly across all of your equipment, or it can be "scheduled," meaning each piece of equipment is listed individually. If you have high-value equipment that is essential to your operation, scheduling is often worth it. We'll explain why below.
What Does Farm Equipment Insurance Typically Cover?
Most farm equipment insurance will cover the cost of repairing or replacing equipment if the damage was caused by:
Fire, lightning, or explosion
Theft or vandalism
Collision
Overturn
Weather events like hail or wind
Mechanical breakdown
Each policy may define covered causes of loss differently. Working with a local agent can help you evaluate your risks and find coverage that meets your needs.
What Is Usually Not Covered?
Like most types of insurance, farm equipment coverage has limitations. Coverage often doesn’t apply to:
Normal wear and tear
Equipment used primarily on public roads
Rented or borrowed equipment
Equipment not listed on the policy or included in the lump sum
If you regularly use equipment on public roads, commercial auto insurance may be the right fit for that piece. Similarly, if you frequently rent or borrow equipment, talk to your agent about endorsements that can fill those gaps.
How Farm Equipment Insurance Works: Blanket vs. Scheduled Coverage
There are two ways to structure your farm equipment coverage.
Blanket coverage: A single limit that applies to all equipment collectively with one lump sum. This is simpler but can be risky if you have high-value items.
Scheduled coverage: Each piece of equipment is listed individually with its own value and description. Since this is more precise, it often results in less coverage gaps.
Many farmers use a mix of both. Lower-value tools can often fall under a blanket limit, while higher-value items like tractors are better protected in a scheduled list.
Tip: Make sure to keep your equipment schedule up to date! When you purchase or sell a piece of equipment, be sure to let your agent know. Maintaining your farm insurance policy is one of the easiest ways to to avoid being underinsured when it matters most.
How Farm Equipments’ Value is Determined
The value of your equipment is typically calculated one of two ways:
Replacement cost covers the cost to replace the equipment with something of similar kind and quality at today's prices, without deducting for depreciation.
Actual cash value (ACV) is replacement cost minus depreciation based on the equipment's age and condition. Older equipment is often covered at ACV by default, which can result in a lower payout after a loss than you might expect.
It's worth reviewing which valuation method applies to your equipment. For a deeper dive on how these two methods compare, see our guide on Actual Cash Value vs. Replacement Cost. Although written for homeowners, this can still be a helpful resource to understand the fundamentals of ACV vs. RC.
Situations That Need Special Attention
There are a few common scenarios where standard farm equipment coverage may not apply or may need to be adjusted.
Leased or financed equipment. If you have a loan or lease on a piece of equipment, your lender may require specific coverage, such as comprehensive and collision. Be sure to let your agent know about any financed machinery so your policy meets those requirements.
Equipment used for custom work or hire. If you use your equipment to do work for other operations — such as custom farming, custom cutting, or hired spraying — it may not be covered under a standard farmowners policy. Ask your agent about endorsements that can address this.
Seasonal storage. Equipment that sits unused for part of the year may be eligible for reduced premiums during that period. It's worth exploring this option with your agent if your operation is seasonal.
ATVs, snowmobiles, and other utility vehicles. Many farm insurance companies prefer these to be covered separately rather than under a farmowners policy. Hillock Insurance offers coverage for ATVs, side-by-sides, snowmobiles, and other utility and recreational vehicles.
Farm vehicles and trailers. Standard pickups, SUVs, and other personal vehicles — as well as horse and utility trailers — are not considered farm equipment. These are best covered under a personal or commercial auto policy. If you're not sure where your vehicles and trailers stand, we're happy to take a look.
How to Make Sure Your Farm Equipment Is Properly Insured
Farm insurance can be layered and complex, so we recommend staying in regular contact with your agent. Here are three practical steps to make sure your equipment is properly protected:
Keep an updated equipment inventory. For each piece of equipment, note the year, make, model, serial number/VIN, and approximate value. This record is invaluable if you ever need to file a claim.
Make updates ASAP when you sell or buy. Whether you’re buying, selling, or trading equipment, let your agent know before or as soon as it happens. Don’t wait for the renewal as coverage may not automatically apply to new equipment, or you may be overpaying for insurance that is no longer necessary.
Review scheduled equipment and values once a year. Equipment values fluctuate, and replacement costs have increased in recent years. A quick annual review helps ensure your coverage keeps pace.
Get Farm Equipment Insurance in Oregon, Washington, and Idaho
Hillock Insurance has been working with farmers and ranchers in rural Oregon, Washington, and Idaho since 1999. We take pride in helping local farmers of all sizes in Wallowa and Union counties, and beyond, protect their livelihoods. Inquire today to get farm equipment insurance in Oregon. We are also licensed to work with farmers in Idaho and Washington.
Whether you're looking to review your current farm policy or get a quote from scratch, we're here to make the process straightforward.
Frequently Asked Questions
Does my farmowners policy automatically cover my equipment?
Not necessarily. At minimum, you'll likely need to specify a blanket coverage amount that applies across your equipment. If you have high-value items like a tractor or combine, we also recommend scheduling them individually to prevent coverage gaps.
What if my tractor is damaged on a public road?
A standard farmowners policy will generally cover physical damage to your equipment, but it may not provide liability coverage while the equipment is being operated on a public road. If your tractor or machinery is regularly driven on public roads — for example, traveling between fields — you may need a farm auto policy or an endorsement to ensure proper liability coverage. It’s important to review how your equipment is used so the right protection is in place.
How do I know if my equipment is scheduled on my policy?
Review your policy's declarations pages and look for a scheduled equipment section. Each listed item should show a description and its insured value. If you don't see it or aren't sure what you're looking at, reach out to your agent.
Does farm equipment insurance cover theft?
It can, but not all policies include theft coverage. It's worth confirming with your agent or reviewing your policy's listed causes of loss, especially if you store equipment in a remote location.
What’s the difference between farm equipment insurance and commercial equipment insurance?
Both work similarly, but farm equipment insurance is specifically designed for machinery used in agricultural operations. Commercial equipment insurance is typically geared toward construction, landscaping, or other contractor equipment. If you run a farm and a separate business, you may need both. A local agent can help you sort out which coverage belongs where.
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