Why full disclosure is essential for farmers

SOUTH Africa's farming sector is under growing financial pressure, prompting many farmers to adopt innovative strategies to maintain profitability.

- JAN-HENDRIK BOTHA

These can include contract farming arrangements, leasing portions of land to third parties, or switching to higher-value crops and infrastructure investments. However, these changes can introduce new risks that may not be covered under their existing insurance policies.

I urge farmers to prioritise full disclosure of any changes to their operations. When a farmer's insurance policy is initially underwritten, it is based on specific farming-related activities, whether it’s cattle farming, crop production, or fruit farming. Alterations to operations — such as leasing farm space to outside contractors, installing solar energy systems, or engaging in third-party processing — change the risk profile. If these aren't disclosed to the insurer, the policy may no longer be valid, and claims could be denied.