When a farm changes hands, many risks come with it—both seen and hidden. One big mistake people often make is not updating their insurance details right away. Devin Snell, agriculture practice leader at Acrisure, says this is a common issue, especially in farm transfers in Arkansas and the southern U.S. Families sometimes think they’re protected, but gaps in coverage appear because ownership changes or names on the policy aren’t updated.
Snell points out that it’s not just about paperwork. Farms often lack clear legal agreements about who will take over in case of death or if someone wants out. Without buy-sell agreements, the next generation might be stuck with partners who aren’t interested or experienced in running the farm. “You don’t want to be running a farm with people who have no involvement or accountability,” Snell explains.
Another problem is outdated valuations. Equipment, buildings, and livestock may be insured for less than their actual worth because policies haven’t kept up with rising costs. New owners might inherit these old policies, leaving them underinsured if something goes wrong. But the biggest issue might be a lack of connection with insurance brokers. Older farmers often keep insurance decisions to themselves, so younger farmers don’t fully understand what’s covered or how to adjust policies for new farming methods.
Snell also highlights risks that younger farmers often underestimate: undervaluing assets, not fully grasping revenue protection, and neglecting safety on the farm. Younger farmers tend to be more open to taking risks and trying new tools and technologies—like drones with thermal imaging for crop health—but many insurers aren’t keeping pace with these changes. While some large insurance companies have updated their programs and offer education on emerging risks, smaller regional insurers tend to stick to traditional ways.
These new farmers are also exploring different insurance strategies such as co-ops, captive programs, and self-insured models. These options can save money but need careful planning and good risk management. They operate with a higher tolerance for risk and adapt quickly, changing what and how they farm depending on what works.
Snell stresses that insurance should go beyond being just a paperwork exercise. As farms become more data-driven and dynamic, insurance needs to play a bigger role as a tool to manage risk strategically. Without this shift, coverage gaps could grow wider.
In short, farms changing hands need more than land titles and old insurance policies. Keeping insurance up to date, establishing clear ownership agreements, understanding coverage, and building strong relationships with brokers are all key steps to protect the farm’s future. It’s about making sure the people who run the farm also have their insurance running right alongside them.