Dairy Operations Sponsored By www Hartford Livestock com

Dairy Operations Sponsored By: www. Hartford. Livestock. com Insurance Community University

Dairy Operations q. The webinar will begin shortly. q. There is no audio at this time. q. This presentation is being recorded for your viewing pleasure at a future date. q 100% Participation in Polling Questions is required to receive credit for this class. Even if you do not intend to receive credit, please participate in the polls. q. The attendance and proctor forms are available under ‘Materials’ in the Webinar’s Console to the right. q. The Power. Point presentation is also available under ‘Materials’. q. You will receive the course number for your state near the end of class. q. Use the ‘chat’ window for questions on the content. Insurance Community University 2

Welcome to your Insurance Community University Audio • All of you are currently on mute – Un-mute your own system – Telephone Option • Select Telephone on your screen • Dial in the PIN number so that your number becomes active – Microphone and/or Speaker Option • You can use this option if you have a headset that you use with your computer Insurance Community University 3

Participation & Chat Window • You will receive information from the monitor via the ‘Chat’ window. – Please locate window in the control panel • Q & A is welcomed during the presentation and at the end of the presentation • You will find the question box on your control panel – Write your question in that box and send it to the presenter/organizer • The presenter will take those • questions in the order submitted Insurance Community University 4

DOI Requirements • When you see a slide with the hand up symbol, touch the “hand” icon on your control panel – Click ONCE only • If you do not raise your hand, the monitor will be in contact with you in the chat box • If you are in a group, the designated proctor is responsible to make certain you are all in attendance at all times = Hand is down Insurance Community University 5

Polling • Throughout the class we will be conducting periodic polls • We need 100% participation on the polls • The polls are intended to check participation but also to create discussion topics throughout the presentation Insurance Community University 6

Forms To Complete for CE • After class ends – Return attendance form – Proctors – return your form to email address • Email address is in chat window or in email sent to you today Insurance Community University 7

DOI Requirements • We will file your hours with the DOI after the completion of this webinar and we have received the attendance form. • You have 48 hours to return the form • You will be sent a Certificate of Attendance/Completion by email. Please retain this for your records for five years. Insurance Community University 8

Your Instructor Today Mike Sergeant , AFIS Sales & Service Director, The Hartford Financial Services Livestock Sponsored by: www. hartfordlivestock. com Insurance Community University 9

What This Class Will Cover 1. Background on Dairy Operations 2. Specific types of Dairy Insurance 3. Important insurance considerations for the Dairy Operation Insurance Community University 10

Background on the Dairy Operations Some Definitions Insurance Community University 11

Definitions Freestall Barn • Type of housing facility for dairy cows that provides clean, dry resting area and easy access to food & water. Cows are not restrained and are free to enter, lie down, rise and leave the barn whenever they desire Pole Barn • Structure often seen in the Midwest and areas where weather is a factor. • Cows are kept in stalls during winter months Insurance Community University 12

Definitions Lagoon Bulk Tank • A manure storage basin dug into the ground like a pond and lined to prevent absorption into the soil. • Refrigerated storage tank designed to hold milk as soon as it leaves the cow. Milk is collected and cooled for shipping to the processing plant. Insurance Community University 13

Definitions Run Off • Water from rain, snowfall or other sources that flows over the land surface. Dairy farmers use “catch basins” to control the amount of run off from their farms. Insurance Community University 14

Dairy Coverages Insurance Community University 15

Definitions Named Perils • Lightning • Wind or Tornado • Falling Objects • Collapse of Bridges or Culverts • Drowning • Artificial Electricity (Pumps) • Attack by Wild Animals • Animal Collision • Carcass Removal • Smothering Directly Caused by a Blizzard or Snowstorm Insurance Community University 16

Contaminated Feed & Water Endorsement • Limits Available • Deductibles • Rates are per head/month and include an exclusion for terrorist acts Insurance Community University 17

Transportation of Dairy Cattle • Cargo Coverage for Livestock • Transit – Cargo Insurance – Stand Alone • Part of the Farm Package – Scheduled Values- Be aware of per head limits. • Death Only or Death & Crippling while being transported. • Many Dairies have at least one tractor trailer unit to haul their livestock. • If use common carrier obtain Cert. of Insurance Community University 18

Feed and Grain Coverage • Average Farm Policy Limits for Hay - $10, 000. per Stack (Higher Limit available by endorsement) • Feed Expenses Rising- i. e. corn • Supplements are a costly inventory. Insurance Community University 19

Milking Parlors • Where the milking process is performed • Cattle are brought in 2 -3 times a day • It takes 15 minutes to milk a cow with a machine Insurance Community University 20

Milking Parlors • Styles – – Herringbone Parallel Swing Rotary (Carousel) • Boiler & Machinery Coverage (EB) – The complexity & expense of modern dairy parlor equipment requires additional insurance for breakdown as well as increased property limits to include replacement costs. Insurance Community University 21

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Semen & Embryo Storage • More efficient to A. I. cows and produce controlled results. • Storage tanks using liquid nitrogen are often on premises. • Values can be upward of • $1 million per tank. • Bloodlines irreplaceable Insurance Community University 25

Cheese Operation—Artisan Cheese Insurance Community University 26

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Cheese Operation • Americans eat an average of 33 pounds person annually. • Artisan cheese is the fastest growing segment of the cheese marketplace according to a recent A. C. Nielsen study. • Artisan cheese which is processed on the dairy using only the milk from the herd of that dairy is called “farmstead cheese Insurance Community University 31

Cheese Operation—Protection for the Producer • Protection against financial loss arising out of the legal liability incurred by a manufacturer, merchant or distributor because of injury or damage resulting from the use of a covered product. • CGL may contain an Exclusion for “Product Recall” Insurance Community University 32

Cheese Operation—Protection for the Producer • • • Accidental Product Contamination (APC) Products Extortion Coverage Products Tampering Coverage Malicious Product Tampering (MPT) Specialty Form – Not all forms are Created Equal Insurance Community University 33

Hunting On Diary Farm Property • Exposures – Liability – Hunter injured or killed – Security – Allowing strangers on property – Bio-Security – Possible contamination – Theft – Loss of equipment or drugs Insurance Community University 34

Hunting Risk Management • Limit access to friends & family • Buy Liability Insurance – Can be written under CGL but few if any underwriters will accept the risk – Premiums higher • Enroll in a Hunter Access Program which has an insurance program Insurance Community University 35

Hunter Access Programs • Wildlife Division Management Unit of Dept. of Natural Resources (Midwest & Southern States) • Dairy signs lease with program and is listed in a guide available on line. • Hunters issued daily permits at Dairy headquarters and must register each time the property is visited. Insurance Community University 36

Benefit of Hunter Access Program • Dairy receives payment to allow public hunting on their property. • Landowners are free from liability as stated in P. A. 451, “No cause of action shall arise for injuries to persons hunting on lands leased under HAP unless the injuries were caused by the gross negligence of willful and wanton misconduct of the owner, tenant or lessee. Insurance Community University 37

Hunting Lease Liability Insurance • • • Offers liability insurance protection Commercial General Liability Guest Medical Payments Fire Legal Liability $50, 000 CGL $1, 000 per Occurrence/$2, 000 Aggregate Insurance Community University 38

Craft and Hobby Exposures Insurance Community University 39

Craft and Hobby Exposures • On Premises—usually attached to house • Often run by wife or daughter of insured • Premises exposure – Liability (slips & falls) – Security (unknown people allowed on premises Insurance Community University 40

Petty Zoos • In 2006 E. coli infections in Washington & Pennsylvania caused 56 illnesses & 19 hospitalizations that were all linked to school & family visits to farms with petting zoos. • Public phobia of E. coli is at an all time high and can cause a public relations nightmare for the Dairy. Insurance Community University 41

Petting Zoos Risk Mangement • Risk Management – Information should be provided about the risks: Calves, goats & poultry pose a great risk. – Post signs and provide a wash station and be sure children under the age of five are supervised – Food should be served in a separate area – Hand to mouth activities- carrying toys or pacifiers should not be permitted. Insurance Community University 42

Hay Rides • In October Dairy Employees, 2006, on a farm in rural Wisconsin a church group was invited to participate in a hayride by child’s parents who owned the Dairy where the ride was to be held. • Two children fell backwards off the wagon and were run over by the back wheels. One child suffered a head injury and had to be hospitalized. • Result: Parents of injured child sued the Dairy and were awarded $750, 000. 00 in damages. Insurance Community University 43

Hay Rides Community Exposures • Schools and Church organizations are often allowed onto dairy to participate in Farm experience. • Be sure seating is appropriate and safe. • Instruct driver of team to go slow and avoid ruts in road or pasture. • Keep noisy children away from horses and wagon. Insurance Community University 44

Dairy Employees Insurance Community University 45

Exposures • Usually long term employees – average 5 years. • Live on premises • Housing provided as part of benefit package • Family of worker occupies housing. • Majority of workers are Spanish speaking males. Insurance Community University 46

Insurance Considerations • Housing may be covered by “standard” CGL to protect landlord. • If injury is due to faulty housing Worker’s Compensation could subrogate back against “landlord” • Dairies are being informed that if they provide housing for five or more employees they are considered a “labor camp” and must apply for permit and pass inspection. Insurance Community University 47

Risk Management Suggestions • Accident & Disability Policy in Worker’s Name. Source of payment for injury besides Worker’s Compensation. • Example: $40, 000 Max payment for any accident no matter if job related or not- include medical, disability, loss or life. • Separate Property & Liability Coverage on Worker’s housing to include family of worker. Insurance Community University 48

Prevention & Safety • Have Warning Signs posted in both English & Spanish. • Instruct employees using visual supervision and repetition • Provide Loss Control services to include the Worker’s Family members. Insurance Community University 49

Pollution and Run Off Exposures Dairy Lagoons Dairy Catch Basins Methane Digester Systems Insurance Community University 50

Methane Digester System—How it works • Manure is flushed to a collection point where solids are removed and recycled. The manure wastewater is then sent through the bottom of the digester where it is retained for 40 -60 days. As manure wastewater moves up in the digester, bacteria digest the waste and produce a methane rich gas known as biogas. Biogas is typically 60% to 80% methane. • The gas is used to power a generator which creates electricity. Insurance Community University 51

Roll Call! Insurance Community University 52

Disclaimer Insurance forms and endorsements vary based on insurance company; changes in edition dates; regulations; court decisions; and state jurisdiction. This instructional materials provided by Insight is intended as a general guideline and any interpretations provided by Insight do not modify or revise insurance policy language. The authors of these materials, Insight Insurance Consultants is a division of Insight Consulting and Management Inc. In providing these materials, Insight assumes neither liability nor responsibility to any person or business with respect to any loss that is alleged to be caused directly or indirectly as a result of the instructional materials provided. Copyright 2010 – 2012 All Rights Reserved www. insurancecommunitycenter. com www. Hartford. Livestock. com Insurance Community University 53

Upcoming CE Classes 11/28 Insight on Crop Insurance Changes 12/5&6 Insight on Errors and Omissions 12/12 Dairy Farms FREE Community Class 11/15 Preparing for 2013 & an overview of Annuities 12/4 Construction Defect – the importance of understand the statutes Join the Community TODAY at: www. insurancecommunitycenter. com Insurance Community University 54