Herbicide Drift + Insurance = Know Your Coverage
This isn’t the first time that the question of chemical drift liability has come up, but it sure has taken on new significance recently.
The increased use of dicamba herbicide for dicamba-tolerant soybeans is to blame. For reasons that are still being sorted out, some experts say dicamba is more prone to volatilize, drift downwind, and injure unintended crops.
In 2017, Extension estimates that at least 3.6 million acres of soybeans, spread across the country, suffered damage as dicamba use has spread.
Even the insurance companies are struggling with this one. “General liability insurance companies have trouble with something about which they have little experience or actuarial data,” says Ray Massey, agricultural economist at the University of Missouri.
He offers some tips as you asses your risk of this potential liability.
Know your coverage
If you damage someone else’s crops, your general farm liability insurance will come into play, Massey says. “It defends you against unintentional harm to other people.”
Yet, herbicide drift is different than some other injuries, and it may or may not be covered by standard policies, Massey says. That’s why this is a good topic of discussion with your insurance agent. You may need a specific endorsement written into your policy that addresses a chemical spraying event.
“Some policies have an exclusion for limited pollution liability,” says Massey. “Pollution may be defined as smoke, vapor, soot, fumes, acids, chemicals, and waste.”
That means ag chemical drift could be considered an uncovered liability.
“If you spray chemicals, you need that chemical spray endorsement,” Massey emphasizes. “Get it on your policy!”
Know your limits
You should also talk to your insurance agent about your maximum dollar coverage. Are your legal defense costs included in those limits? If defense costs are part of your maximum coverage, any expenses for defense will reduce the amount the insurance company will pay if damages are awarded.
Massey says you also need to ask your insurance agent about who exactly is covered in the event of a chemical drift event. “Is it you, the principal farmer, only? Or are your employees covered, too?
“You may have to tell your insurance company how many employees you have and who you want covered in the general liability policy,” he says.
Massey thinks crop advisers should consider a stepped-up insurance policy called professional liability. It can be thought of as malpractice insurance, like a doctor would carry.
“An issue like chemical drift is not about an illegal activity. Rather, it’s that someone doesn’t like the outcome of an event. They sue you for not living up to professional standards,” says Massey.
“Farm chemical applicators are professionals and, thereby, are held to a higher standard. They are expected to use the latest science and experience to inform their actions,” he says. “Knowing this, you should consider the need for this professional coverage.”
Several federal and state regulatory agencies have tightened the rules for dicamba use in 2018, including time of day and wind speed.
Massey points to a statement from agricultural law professor Peggy Hall at Ohio State University. “Farmers should note that the additional restrictions and information on dicamba labels shift more responsibility for the product onto the applicator,” says Hall.
What about government crop insurance?
Multiperil crop insurance – the government program that usually covers hail and wind damage – won’t cover you or your neighbor for herbicide drift injury. The Risk Management Agency crop insurance policy manual has been clear for many years. “Third-party injury from pesticide injury is not a covered loss,” it says.
RMA has ruled recently that yield losses from herbicide damage can be excluded from your actual production history (APH) for farm program calculations.
“You have to report it to your insurance company within 72 hours of noticing the damage,” says Ray Massey, agricultural economist, University of Missouri. “If you do that and have herbicide yield loss, it won’t reduce your APH. That could have an impact on your APH for 10 years.”