FL 04 25 06 25 Care, Custody or Control of Livestock Analysis
ISO has created ten new optional endorsements that can be attached to the farm liability, property, umbrella, and excess liability forms. The forms are effective June 2025.
The FL 04 25, Care, Custody or Control of Livestock endorsement, was designed to attach to the FL 00 20 Farm Liability Coverage form and provide coverage for property damage to non-owned livestock that is in the insured’s care, custody, or control. An insured’s operations may include boarding or breeding services, and often those types of services include a contractual responsibility for the care and feeding of the animals while they are in the insured’s care. The FL 00 20 excludes damage to these animals, other than a minimum amount of additional coverage under damage to property of others with a limit of $1,000 per occurrence. The FL 04 25 includes a schedule for covering classes of livestock with corresponding limits, an optional per animal sublimit, optional coverage for suffocation, and optional transportation coverage.
Analysis
The endorsement begins with a schedule for classes of livestock with a per claim limit or per animal/head limit, and a checkbox to indicate whether or not coverage for suffocation applies. A checkbox also indicates whether coverage for “occurrences” involving the transportation of livestock applies. The information must either be shown in the endorsement schedule or the declarations.
SECTION I – COVERAGES
The following is added to Section I – Coverages of the Farm Liability Coverage Form:
Livestock Liability
1. Insuring Agreement
Analysis
The insuring agreement of the endorsement clearly states that sums the “insured” becomes legally obligated to pay to a “contract owner” because of damages to livestock as a result of an act or omission of the “insured” while the animals are under the insured’s care, custody or control are covered. Note that the insured must be legally obligated to pay damages because of some action or inaction on the insured’s part. If the insured is under contract to board cattle and forgot to shut the fence and some cattle escaped and were killed in an auto accident, the coverage would apply.
Livestock, as the term is used in the endorsement, must be of a class listed in the schedule with a limit per class. There is an optional sublimit that applies to individual animals. Any livestock that are not part of the designated classes would not be covered, even if under contract.
“Property damage” or “Loss” must fit three parameters. Damage must be caused by an “occurrence”, the livestock must be in the insured’s care, custody or control at the “insured location” owned or operated for “farming” purposes, and the damage or loss must be a result of the insured’s contractual obligations in the boarding, care, and raising of livestock with the “contract owner”. All three of these conditions must be met in order for coverage to apply. If the insured is under contract to board cattle but the cattle are not yet at the “insured location” and injuries are not related to the insured’s boarding of the cattle, then the coverage would not apply.
2. Exclusions
With respect to coverage provided by this endorsement:
The coverage provided in Paragraph 1. above does not apply to "property damage" or "loss" to livestock arising out of:
Analysis
Any injury to the livestock that is expected or intended by the “insured” is naturally excluded. Likewise, any illness, disease, or negligent care practices that affect the livestock are excluded. The insured is being paid to take care of the animals and should be familiar with standard practices. The suffocation of any animal is excluded unless the checkbox in the schedule indicates coverage is provided. Transportation is excluded, unless coverage is indicated by the checkbox in the schedule.
Individual factors apply to the original loss cost with respect to the coverage options, so premiums will increase or decrease depending upon what is chosen, with suffocation resulting in a much higher premium while excluding transportation will result in a premium reduction.
SECTION II – LIMITS OF INSURANCE
With respect to coverage provided by this endorsement, Section II – Limits Of Insurance is replaced by the following:
Section II – Limits Of Insurance
1. The applicable Limit Of Insurance shown in the Schedule is the most we will pay for "property damage" or "loss" to livestock regardless of the number of:
2. The applicable Limit Of Insurance shown in the Schedule replaces the limit for damage to property of others in Additional Coverage 2.a.
Analysis
The limits section is straightforward. The limit shown in the schedule is the most provided regardless of the number of “insureds”, claims, or suits brought against the insured, or persons or organizations making claims or bringing suits against the insured.
The limit shown in the schedule replaces the limit for damage to property of others in Additional Coverage 2.a. This endorsement broadens coverage available to the insured.
SECTION IV – DEFINITIONS
With respect to the coverage provided by this endorsement:
Definition 14. is replaced by the following:
14."Insured location" means:
The following definitions are added:
"Contract owner" means a person, partnership or corporation that owns livestock placed under the care, custody or control of the "insured".
"Loss" means:
Analysis
To effect the coverage provided, certain terms need to be defined or clarified specific to this endorsement. “Insured location” is defined as the farm premises, including grounds and private approaches listed in the declarations, premises used by the insured in conjunction with the farm premises. These are specifically described in subsection a., vacant land owned or rented to an “insured”, any part of a premises occasionally rented to an “insured” for “farming purposes”, and any farm premises, including ground and approaches that the insured acquires during the policy period.
This definition restricts the insured premises by removing references to locations where the insured is temporarily residing, land where a dwelling is being constructed, cemetery plots, and premises rented for other than “business” or “agritainment” purposes.
“Contract owner” is the person, partnership or corporation that owns the livestock that is in the insured’s care, custody or control.
“Loss” is defined as the injury, death, or destruction of livestock, including hyperthermia that leads to death or injury of the livestock. Suffocation may be covered for additional premium if it is indicated on the schedule. If not indicated, then no coverage is provided. Likewise, damages resulting from transportation of livestock, including collision or overturn of a vehicle in which the animals are being transported, are covered if transportation is listed in the schedule. Collision is an accidental contact of that vehicle with another vehicle or object. If the truck transporting the livestock is struck by another vehicle and the livestock inside are injured, that is a collision.
Includes copyrighted material of Insurance Services Office, Inc., with its permission.
Christine G. Barlow, CPCU
Christine G. Barlow, CPCU, is Executive Editor of FC&S Expert Coverage Interpretation, a division of National Underwriter Company and ALM. Christine has over thirty years’ experience in the insurance industry, beginning as a claims adjuster then working as an underwriter and underwriting supervisor handling personal lines. Christine regularly presents and moderates webinars on a variety of topics and is an experienced presenter.