FARM EQUIPMENT
Category: Manufacturing
SIC CODE: 3523 Farm Machinery and Equipment
NAICS CODE: 333111 Farm Machinery and Equipment
Manufacturing
333922 Conveyors and Conveying Equipment Manufacturing
Suggested ISO General Liability Code: 56651
Suggested Workers Compensation Code: 3507
Farm machinery and equipment manufacturers produce larger farm implements, including balers, combines, harrows, harvesters, irrigation systems, milking machines, planters, plows, seeders, sprayers, spreaders, and tractors. Some also produce lawn and garden machinery. The products may run on tracks or tires. The process consists of designing the product, developing patterns or molds for component parts, making or subcontracting the various parts, assembling the final product, finishing, testing and quality control, and delivering to the dealer or customer.
Operations include electroplating, forging, grinding, heat treating, metal casting, plastic extrusion or molding, sheet metal stamping, spray painting, upholstering, and welding. The manufacturer may produce the internal electronic or electrical assemblies or purchase them pre-made from another manufacturer and simply assemble the final product. Because of the variety of materials and processes involved, the different phases of manufacture may be carried out in different locations or countries.
While diesel-fueled farm equipment has been commonly used in the past, manufacturers are now offering some electric-powered or hybrid items. As new farm equipment increasingly relies on computerization and robotics, farmers are unable to make their own repairs. The Right to Repair movement pits farmers’ needs to quickly repair their equipment, particularly at harvest time, against manufacturers’ desire to protect their intellectual property. In Colorado, farmers are legally permitted to repair their own machinery, and other states are considering similar legislation. Many types of agricultural equipment are subject to federal regulation.
Consist of an office, plant, and warehouse or yard to store raw materials, components, and finished units. Ignition sources include electrical wiring, heating and cooling systems, production machinery, storing large amounts of fuels to operate, lubricate, and maintain them, explosions from dust build-up from the cutting and sanding operations, welding, and spray painting. Wear and tear and overheating of machinery are potential fire hazards.
Wiring for equipment must be up to date and meet current codes. Lubricants, solvents, or degreasers may be flammable and must be adequately separated and stored away from other operations in approved containers. There may be fuel tanks on premises. Hazards may include casting, electroplating, heat-treating, plastic or fiberglass work, sheet metal work, upholstering, or woodworking. Without well-maintained dust collection systems, cutting and buffing operations can generate dust that can catch on fire or explode.
Welding and refueling of forklifts should be done in well-ventilated areas away from combustibles. Welding, soldering, and refueling of forklifts should be done in well-ventilated areas away from combustibles. Welding requires basic controls such as chained storage of tanks in a cool area and separating welding operations in either a separate room or with flash/welding curtains away from flammables. Spray painting should be conducted in an area with explosion-proof wiring that meets all UL standards.
Poor housekeeping, such as failure to collect and dispose of trash regularly, could contribute significantly to a loss. Unless disposed of properly, greasy, oily rags (such as those used to clean machinery) can cause a fire without a separate ignition source. Electronic circuitry may be contaminated by dust or damaged by static. Property stored in the open may be subject to loss by wind or hail or a target for vandalism.
Appropriate security controls must be taken, including lighting and physical barriers to prevent entrance to the premises after hours and an alarm system that reports directly to a central station or the police department. Bottlenecks in the assembly process may result in a high concentration of values of partially completed units, affecting both property valuation and business income.
Can be high when a lengthy amount of time is required to restore operations. There may be substantial exposure to loss of income resulting from damage to dependent properties such as key suppliers or customers.
Include malfunctioning production equipment, dust collection and ventilation systems, electrical control panels, and other apparatus. Production equipment may include CNC (computer controlled) machinery. These should be properly maintained with records kept in a central location. A lengthy breakdown could result in severe loss, both direct and under time element.
Include accounts receivable if the manufacturer offers credit, computers (which may include computer-run production equipment), contractors' equipment for forklifts, goods in transit, valuable papers and records for proprietary designs, quality control, and customers' and suppliers' information. Backup copies of all records should be made and stored off premises. The manufacturer may exhibit products at trade shows. If finished machinery is sent to dealerships under financing provided by the manufacturer, floor plan coverage is needed. Goods in transit and off premises may be damaged by fire, water, wind, hail, theft, collision, and overturn. There may be an installation exposure for equipment to be used on corporate farms.
Is moderate from employee dishonesty and theft as component parts and finished items are high in value. Employees may act alone or in collusion with outsiders in stealing money, raw materials or finished stock. Background checks should be conducted on all employees. There must be a separation of duties between persons handling deposits and disbursements and reconciling bank statements. Physical inventories should be conducted regularly to prevent employee theft of equipment. Annual outside audits should be conducted.
Is low due to limited access by visitors. If tours are given or if outsiders are allowed on premises, visitors must be confined to designated areas. To prevent injury from slips, trips, or falls, all areas accessible to the public must be free of obstacles, with floor coverings in good condition. The number of exits must be sufficient and well-marked, with backup lighting in case of power failure. There should be a disaster plan for unexpected emergencies.
Parking lots and sidewalks must be in good repair with snow and ice removed, generally level and free of exposure to slips and falls.
If stock is stored in the open, it becomes attractive to trespassers, particularly children. The yard should be fenced to prevent unauthorized access, with proper lighting and warnings. Fumes, dust, and noise from processing may affect neighbors, resulting in nuisance claims.
Off-premises liability exposures come from exhibitions or demonstrations at retail locations, fairs, or conventions. There may be an installation exposure for very large machinery on corporate farms. Because welding and soldering may take place during installation, controls must be in place to prevent fire damage to the machinery and surrounding areas.
Include allegations of assault and battery, copyright or trademark infringement, defamation if misleading statements are made about competitors, false advertising, invasion of privacy, and wrongful ejection from the premises.
Is high due to the high potential for bodily injury to users, which may result from defects in design, poor workmanship, hidden damage during storage (such as rust) or during shipping (such as unseen breakage of a part), product malfunction, or improper use. Farm equipment involves sharp cutting devices and rotating blades designed to tear and rip crops apart. Safety devices must be installed in such a way that they are not easily bypassed or damaged.
Individual operators often work alone, sometimes at night, away from rapid-response emergency services. Machinery may roll over when used on rough terrain, ejecting operators and potentially crushing them. Sharp-edged parts could break off and cause severe injuries. Malfunction in the wiring could present a fire or an electrocution hazard. Rupture in the fuel lines or tanks could result in an explosion. Milking machines may injure animals.
Warning labels regarding the dangers of personal injury are important but provide only limited defense as courts commonly apply strict liability standards to inherently dangerous products. It may be impossible to defend against questionable claims unless an aggressive quality control program includes high standards for materials, testing and monitoring of components, and documentation of sources down to each individual part. Product recall procedures should be in place.
Governmental regulations, guidelines, and standards must be observed. Farm machinery tends to have a longer life span than other types of motorized equipment, particularly since farmers are now buying decades-old items that are not dependent on difficult-to-repair computerized systems present in newer models. Older equipment made before improved safety features were introduced may still be in use, extending the period for product liability claims to be made.
Are moderate to high due to the potential for air, land and water pollution from using and disposing of chemicals, paints, solvents, and metal wastes used in processing and servicing machinery. Raw plastics are flammable and may be toxic, the catalysts may be caustic, and the final product is usually not biodegradable. Vapors, fumes and air pollutants, wastewater, and by-products disposal must be evaluated and controlled. Spillage and leaking of pollutants can result in high cleanup costs and fines. Storage and disposal must adhere to all EPA and other regulatory standards. There may be fuel tanks on premises with the potential for spillage and contamination. If there are underground tanks, a UST policy may be required.
Is high if the manufacturer picks up raw materials or components or delivers finished goods to customers. Transportation of oversized farm equipment requires careful loading and tie-down to prevent items from coming loose and toppling over during transport. Manufacturers generally have private passenger fleets used by sales representatives. There should be written procedures regarding the private use of these vehicles by others. Drivers should have an appropriate license and an acceptable MVR. All vehicles must be well maintained and have documentation kept in a central location.
Are very high. Injuries from production machinery are common, as are minor cuts, puncture wounds, burns, slips, trips, falls, foreign objects in the eye, back injuries from lifting, hearing loss from noise, and repetitive motion losses. Continual standing can result in musculoskeletal disorders of the back, legs, or feet. Workers can be hit by falling objects, be electrocuted, or be trapped between moving parts. Workstations should be ergonomically designed.
Employees should be provided with safety training, protective equipment, and conveying devices to assist with heavy lifting. Areas that generate dust require respiratory protection devices, as well as eye protection and eye wash stations. Metalworking can result in amputations, burns from welding and heated metal, exposure to dust, and respiratory problems from inhaling spray paint or solvents.
Welding operations generate high heat, intense light, and exposure to carbon monoxide, manganese, nitrous oxide, and ozone. Protective gear and clothing, such as face shields, gloves and aprons, are essential. Eye protection is particularly important due to the potential for injury from exposure to UV radiation and infrared light. Plastic parts have similar exposures plus a potential for burns from heated machinery and eye and skin irritation from chemicals and resins. Workers should be aware of the toxic nature of any chemical. They should be made fully aware of the need to watch for early signs and symptoms of problems.
Guards should be on machinery, as well as lockout/tagout procedures, especially the cutting and shearing devices. The high volume required for production schedules may lead workers to remove machinery guards or postpone maintenance and repair to increase production. Moving blades or sharp cutting surfaces pose high risks during quality control testing. Since testing and demonstrations may take place, there can be over-the-road exposures for non-sales employees.
Drivers of forklifts and vehicles may be injured in accidents.
· Building
· Business Personal Property
· Business Income with Extra Expense
· Equipment Breakdown
· Accounts Receivable
· Computers
· Contractors Equipment
· Goods in Transit
· Valuable Papers and Records
· Employee Dishonesty
· General Liability
· Employee Benefits
· Environmental Impairment
· Umbrella
· Hired and Nonownership Auto
· Workers Compensation
· Business Income - Dependent Properties
· Earthquake
· Flood
· Exhibitions
· Floor Plan
· Installation Floater
· Active Shooter
· Cyberliability
· Employment-related Practices
· Professional
· Underground Storage Tank
· Business Auto Liability and Physical Damage
· Stop Gap Liability
Edition 2024