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Pittsburg, Kansas | This will not apply to most people. Defintely not if you have a mortgage and a bank is involved. It probably will not apply if you are still actively farming and not retired.
I completely dropped my insurance (other than whole farm liability) on most of my buildings. I kept insurance on my main house and my heated shop building as I rent it out and get income from it. Also have kept insurance on my grain bins because I also rent them out and get income. But all the other buildings, machinery sheds etc, if a tornado or storm gets them I am just out. (gasp! from most people).
But here is my thinking. From the premiums I save my bank account will grow. I am 70 years old. I no longer use those buildings and although they are a part of the rental agreement with my nephews if they were gone it would only change the rental amount marginally if at all. So they are not much if any of an income source. If they blew away I would not replace them but just keep the insurance settlement amount. So in effect I figured what I was buying with insurance on them was a lottery ticket. If they blew away I won. If they didn't the insurance company won. I figured the insurance company knew the odds way better than me so it was probably better to not buy the lottery ticket. That is not what the insurance salesman wants to hear, although mine took it way better than I thought he would and understood.
The key is I would not replace them so would not have to come up with the money to replace them. Insure what I can't afford to lose. I could afford to lose those buildings (although I do admit I would have some out of pocket clean up costs should they be destroyed, but that is minor compared to the cost of replacing them)
These are just rantings of a lunatic. Pay no attention.
Edited by John Burns 11/26/2024 08:16
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Property/ liability insurance rate hike ?
