Fire insurance: An investment in a sustainable farming future

There are few things that farmers dread more than that column of grey-white smoke appearing on the horizon on a dry, windy day. The fear and the very real danger of veld fires can never be over-estimated; not only do fires cause severe damage to property, agriculture equipment and farming infrastructure, it almost always lead to loss of assets, livestock, crops and natural veld and grazing pastures.

Moreover, the issue of liability can be of greater risk to the future sustainability and livelihood of a farmer: should a fire break out on your land and spread to neighbouring farms, you as a landowner or tenant can be held liable for any loss or damages caused to surrounding properties.

For this reason, fire insurance should be a key consideration in any farmer's risk management strategy, says Emil Pretorius, Segment Solutions at Santam Agriculture. "There is a general perception that fire insurance is expensive - but that is not true at all. It can be your biggest mistake not to insure your assets or your liability against the risk of fire,” he says. "Fire insurance is an investment in the future sustainability of your farm, and a non-negotiable when it comes to safeguarding your legacy."

He explains assets can be insured against fire hazards under different sections. He said a farmer needs to pay special attention to liability cover, especially regarding the spread of fire by making sure that the cover is indeed included.  Emil advises that, for total peace of mind, farmers should consider an extension on the liability section to act as a safeguard for claims exceeding the general limit.

At a recent virtual presentation by Agri Northern Cape for farmers who were affected by fires in this province, Emil highlighted the need for public liability cover in the event of fires spreading.

"In one case, a farmer on whose farm a fire broke out after children played with matches, was held liable by his neighbour for damages of R27 million. Fortunately, thanks to his liability insurance cover, he was not held liable in his personal capacity. 

Increased risk of veld fires in 2022

Environmental factors such as changing weather patterns and expanding human settlements mean landowners are dealing with more fires on a daily basis than in the past. These fires are often more extensive and devastating than similar events a decade ago. From January to October 2021, more than 86 000 fire incidents were reported in the Free State, North West and Eastern Cape, destroying more than 2.3 million hectares of veld.

The extent of the damage is so great that if the affected parts are to be declared disaster areas, the state will simply not have the ability to assist farmers, says me. Andrea Campher, risk and disaster manager at Agri SA. "Due to bureaucratic red tape, disaster relief will not be delivered on time because state resources are under pressure due to the COVID-19 pandemic."

The current good summer rainfall over several provinces have resulted in the rapid growth of brush and grass, posing an even greater risk of veld fires during 2022. Historically, the fire season in the central interior of the country usually starts in June or July but due to the La Niña weather phenomenon and good rainfall, it already started in April 2021. Livestock farmers are particular vulnerable as it is usually spare grazing with a higher combustible material content which runs the greatest risk of catching fire.

Compliance with legal requirements

The Veld and Forest Fires Act (Act 101 of 1998) stipulates a number of legal requirements that all landowners must comply with in terms of managing the risks of fires. One is that they are obligated to make firebreaks and maintain these properly to prevent the spread of wildfires. Violation of the law may result in a landowner being obliged to pay for the damage caused by the fires.

Proper training must also be provided to all employees, as well as access to proper fire equipment and protective clothing must be ensured. A dedicated person should be tasked with the responsibility to take the lead in any fire related incidents, including alerting the neighbours and the FPA.

Santam Agriculture encourages farmers to join their local Fire Protection Association (FPA) as a first step towards managing the risks of veld fires. Given the increased risk management and legal advantages that an FPA membership offers, Santam is rewarding FPA-member clients with more competitive premiums and excess payment incentives.

Tips to be better prepared for the 2022 season

• Learn to recognise the weather conditions associated with high fire hazard. These include high temperatures, wind speed and direction as well as humidity.
• Get tech savvy: Satellite-based fire information tools such as the Advanced Fire Information System (AFIS) provide real-time fire information.
• Limit the use of potentially hazardous machinery and equipment in the veld in high fire risk conditions
• Be extra vigilant and be prepared.