When a farm changes hands, the risks aren’t just operational - they’re financial, and often invisible until it’s too late. One of the most common mistakes? Failing to update insurance details.
“The first one is the easiest,” said Devin Snell (pictured), agriculture practice leader at Acrisure. “It’s kind of the low-hanging fruit and that’s going to be changing of entity names, ownership structures, the named insureds, and missing those changes… can a lot of times cause gaps in coverages and sometimes even deniability for coverage.”
Snell said it's a frequent oversight during generational farm transitions across Arkansas and the southern US, leaving families exposed just when they believe they’re protected. That risk increases when policies are inherited without being fully understood - or updated.
Beyond paperwork, the legal structure of ownership is often incomplete. One missing piece: buy-sell agreements. These documents lay out how ownership will be transferred, especially in the event of death or a voluntary exit. Without them, successor generations may find themselves partnered with heirs who have no experience - or interest - in running the farm.
“You don’t want to be operating a business with, or a farm for that matter, with somebody’s kids who have no involvement. No ownership, no accountability,” said Snell. “Buy-sell agreements really help with that.”
Another overlooked area is valuation. Physical assets like equipment, infrastructure, and livestock are often insured based on outdated figures. “Things just cost less prior to now,” he said. That can lead to serious shortfalls if a loss occurs. Newer farmers may inherit policies that no longer reflect current replacement costs, leaving them underinsured.
But the biggest disconnect Snell pointed to wasn’t on paper - it was personal.
“The biggest overshot that I see is a lack of relationship with the broker,” he said. Older generations often keep insurance decisions to themselves, failing to bring younger operators into conversations with agents or brokers. That disconnect means new owners may not know what’s covered, what’s not, or how to adjust policies to match new business models.
Snell outlined three specific risks that often go underestimated during generational transfers: undervaluation of assets, poor understanding of revenue protection strategies, and neglecting on-farm safety.
“They underestimate how difficult that can be,” he said of using insurance to protect revenue and capital. “That knowledge is not just easily accessible. You’ve got to have a trusted partner.”
And when it comes to safety, Snell said it’s usually an afterthought until it becomes a liability. “You can’t operate a farm without people,” he said. “People have tried it and it just doesn’t work.”
Younger operators also approach farming with a different mindset - one that includes a higher tolerance for risk and a willingness to experiment. They're adopting new tools, practices, and technologies at a pace many insurers are struggling to match.
“They’re data driven,” said Snell. “A lot of these younger growers are using drones with thermal imagery to gather data on plant health and soil conditions. And now we have coverages for that stuff here within the past probably two or three years.”
While some insurers have adapted, many haven’t. “The answer is yes, they are catching up, and no, they are not,” he said.
Larger, national carriers are more likely to have tech-driven programs and policy options. They also tend to provide better education around emerging exposures and lean into prevention instead of simply expanding coverage.
By contrast, smaller regional insurers - especially in the southern US - remain conservative. “They appear to be more traditional… in regard to growing or adapting with the upcoming generation of growers,” said Snell.
New strategies, old insurance models
As the next generation takes control, they’re also embracing non-traditional insurance approaches. Snell pointed to increased interest in co-ops, captive programs, and large deductible or self-insured retention models. These strategies offer cost savings but require detailed planning and strong risk management practices.
“They operate a little more risky,” he said. “Their tolerance for risk is higher. And they’re trying things differently than what’s been done historically.”
They’re also changing what they farm, how they manage it, and how quickly they pivot when something doesn’t work. This agility is a hallmark of younger producers - but it can leave insurers scrambling to keep up.
“They’re open to trying all sorts of different physical… applications to save time, save money, be more efficient,” said Snell. “Whereas a lot of the older generation might have been a little more conservative.”
The issue isn’t just risk appetite—it’s whether coverage products and advisory relationships are evolving at the same pace. As operations become more data-reliant, insurance must move from being a transactional purchase to a strategic tool. Without that shift, the coverage gaps will only widen.
“You want the people that need to be at the table at the table,” Snell said.
