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By by Brett Harman

One of the questions I ask farmers I meet is: "What keeps you awake at night?" It’s through these conversations I try to stay on top of trends and connected with customers.

Often their answers have to do with the weather, market prices or how some new government program will affect them. But lately, a lot of the talk has been about lawsuits and their effect on insurance premiums.

This has much to do with the recent spinach recall, which has been all over the news. If these types of stories teach us anything, it’s that consumers are more aware of food-borne illnesses than ever – and they’re quicker to file a claim.

Years ago, when it was harder to figure out a common cause behind people in a region getting sick, folks often wrote an illness off as just a case of the stomach flu. Now, technology can trace what caused the incident and empower lawyers of those who get sick to sue producers and everyone else in the distribution chain.

The spinach contaminated by E. coli bacteria has already generated several lawsuits against a California grower and more are expected. In many cases, iInsurers will have to pay for these farmers’ and agribusiness owners’ defense, even if they aren’t found liable. As a result, those costs get passed along to everyone in the form of higher premiums.

While Ohio farmers don’t grow a lot of spinach, they’re very conscious of anything that could upset the apple cart. Even producers of small crops that don’t need a lot of human contact have concerns about getting caught up in a situation where they can be found liable.

Gailyn Thomsen, vice president of with the Auglaize Farmers Cooperative, says that while most grain farmers in his co-op aren’t overly concerned about contamination, farmers with cattle or hogs are emphasizing hygiene and food safety more than ever. They want to know how to avoid expensive recalls and what to expect if a problem does occur.

While Gailyn and other co-op membersfarmers worry about lawsuits causing their insurance premiums to go up, the biggest problem a recall presents for them is the money they lose when their business is interrupted by a recall and their reputation damaged.

While commercial general liability and product liability insurance can help cover damages a judge may award to people affected by a food-borne illness, it doesn’t cover the actual costs associated with a recall. You’re going to need money to hire lawyers with expertise in these situations and public relations support to help you through the recall process. The good name that you’ve spent years building can take a huge hit quickly – especially if a mistake seriously harms people.

That’s why farmers and agribusiness owners also need product recall insurance. Product recall insurance covers the costs of notifying the public of the recall, related overtime wages, hiring of contractors and temporary employees and transportation and accommodations. It also covers costs associated with shipping and packaging, warehouse space and disposing the recalled product. Talk this over with your agent because this coverage has limits and deductibles that range widely, depending on the size and type of your operation.

Gailyn, who grows corn, beans and wheat on his a small farm outside Sidney, knows the old saying is true – especially when it comes to insurance – that an ounce of prevention is worth a pound of cure.

That’s why he says he works with his insurance agent to reduce his exposure. Whether it’s learning ways to avoid spraying the wrong product, building dikes around fertilizer tanks, double lining fuel tanks or taking extra steps to avoid contamination, he and other farmers are finding that the best way to keep insurance premiums down is teaming with professional risk consultants to learn what they can do to prevent accidents.

Farmers aren’t establishing this culture of safety just to save money on their insurance. They do it because it’s the right thing to do. Every farmer has to be passionate about growing safe food and following best practices.

Caption: Gailyn Thomsen (right) of Auglaize Farmers Cooperative discusses ways to prevent accidents with Nationwide Agribusiness' Bruce Short.