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Agricultural GDP performance is heavily influenced by climatic conditions. The on-going drought has brought a lot more focus onto our farmers, the tough conditions they are facing and just how important the sector is both for the economy and our survival. From mega farmers running businesses worth hundreds of millions of Rands to the small subsistence farmer, many agricultural businesses are looking at alternative means to increase their income – whether it’s branching out into game farming or tourism.
New ventures require different skills – especially when farming with livestock and/or crops – and these activities bring about legal liability risks. That’s why we’ve compiled a list of the most common scenarios to help you advise your clients:
Insurers support the adherence to the National Veld and Forest Fire Act which deals with the benefits of having a Fire Protection Associations (FPAs) in local areas and various other factors such as fire breaks, fire fighting teams etc. Ensure that your clients are familiar with the Act and/or the benefit of forming FPAs.
The building of dams in South Africa is legislated by the National Water Act (NWA) of 1998. Different rules apply depending on the size of the dam so be sure to educate your clients on the legislation and ensure that they adhere to the requirements.
Aerial crop spraying further increases this risk and most liability insurance policies exclude crop spraying using aeroplanes. Ensure that your insured farmer is aware of this and that he/she has purchased adequate insurance for the crop spraying, whether using an external contractor or their own aeroplane.
In summary: tough economic conditions are forcing farmers to diversify into other activities to earn an additional income. While this entrepreneurial spirit should be celebrated, it’s your role as an intermediary to constantly advise your clients on any new liability risks, and to help them get up to speed with relevant legislations and regulations.
Get in touch with your relationship manager, if you have any queries about liability insurance products. For advice tailored to intermediaries, visit our blog for more articles relating to liability insurance - e.g. just how much insurance is enough.
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