Contractual Risk Transfer in Agriculture

Course Description
Contractual Risk Transfer in Agriculture provides an overview of risk transfer in agricultural contracts, with specific attention to the risk and insurance implications. It reviews the structure of contracting relationships and the key provisions in which responsibilities and liabilities are allocated to the contracting parties, and suggests methods to equitably allocate these liabilities. It also examines processes for ensuring the effectiveness of contractual risk transfers and identifies problems that may arise if contracts are not properly reviewed and their risks managed.

The course discusses the relationship of contractual risk transfers to other traditional and enterprise risk management techniques and the various means by which contracts are used to transfer risks from an indemnitee to an indemnitor. The techniques examined include indemnity (hold harmless) provisions, limitation of liability provisions, and subrogation waivers.

The course examines the contractual liability coverage available in commercial general liability, farm liability, and auto liability policies and some key endorsements. It also discusses additional insured requirements, waivers of subrogation, and certificates of insurance in the context of contracts.

Using several case examples, the course illustrates how the risk transfer techniques can be applied to practical situations.  It also examines the increasingly important role of agricultural production contracts, which involve both pure and speculative risks. 

The course includes the following chapters:

  • Contractual Risk Transfer in Agricultural Risk Management
  • Contractual Risk Transfer Provisions
  • Contractual Liability Coverage
  • Other Contractual Risk Transfers
  • Case Examples of Agricultural Risk Transfer
  • Production Contracts

Learning Objectives:
This is an intermediate-level course. Upon completion, students will be able to:

  • identify and categorize various types of farm risks
  • recognize the role of contractual risk transfer within an agricultural organization’s traditional and enterprise risk programs
  • recognize and distinguish among various types of contractual risk transfer provisions
  • recognize the scope and limitations of contractual liability coverage provided by standard insurance policies and endorsements used in agriculture
  • recognize the significance of additional insured status and identify appropriate ways of providing it in an agricultural firm’s insurance policies and endorsements
  • recognize the purpose and effect of subrogation waivers
  • identify the benefits, limitations, and best practices associated with the use of certificates of insurance
  • recognize appropriate ways of applying contractual risk transfer principles within an agricultural environment
  • recognize the ways in which agricultural production contracts transfer or create risks for a farmer
  • identify factors to consider in evaluating the risks and rewards a farmer might encounter when participating in an agricultural production contract




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