1. Forms
2. FL
3. FL-01-16

What the Form Is

The FL 01 16 Exclusion – Migrant and Seasonal Agricultural Worker Protection Act endorsement is a standard insurance form used in Farm Liability policies. Its primary purpose is to explicitly exclude from coverage any liability imposed on the insured agricultural employer under the federal Migrant and Seasonal Agricultural Worker Protection Act (MSPA). This act mandates certain protections for migrant and seasonal agricultural workers related to wages, housing, transportation, disclosures, and record-keeping. This endorsement ensures that the insurance policy will not respond to claims for damages, fines, or penalties resulting from violations of the MSPA.

Classes of Business It Applies To

This endorsement applies to any agricultural operation or farm that employs, recruits, solicits, hires, furnishes, or transports migrant or seasonal agricultural workers. Examples include, but are not limited to:

• Large-scale fruit and vegetable farms that rely on seasonal labor for planting, cultivating, and harvesting.
• Nurseries and horticultural operations that hire temporary workers for seasonal tasks.
• Custom harvesting operations that provide labor to multiple farms.
• Any farm employer subject to the provisions of the MSPA.

For instance, if a farm that hires seasonal workers for its apple harvest fails to meet MSPA requirements for worker housing, and the workers sue for damages under the Act, this exclusion would prevent the farm's liability policy from covering those MSPA-related damages.

Special Considerations

Key considerations for this endorsement include:

• Mandatory Nature: This endorsement is often mandatory for Farm Liability policies, particularly those written under programs like the ISO Farm Program or specific company programs.
• MSPA Compliance: The MSPA imposes significant obligations on agricultural employers. This exclusion underscores the need for insureds to understand and comply with all MSPA requirements independently of their insurance coverage. Non-compliance can lead to substantial uninsured liabilities.
• Coverage Gap: This form creates a specific coverage gap for MSPA-related liabilities. Farm owners who employ migrant or seasonal workers should be aware that they will not have insurance protection under their standard farm liability policy for claims arising directly from this Act. They may need to explore specialized risk management strategies or ensure strict adherence to MSPA regulations.

Key Information for Agents and Underwriters

• Agent's Role: Agents must clearly communicate the impact of this exclusion to their farm clients, especially those employing seasonal or migrant labor. It's crucial for insureds to understand that MSPA violations will not be covered.
• Underwriting: For underwriters, the presence of migrant or seasonal workers is a significant risk factor. This endorsement helps manage the insurer's exposure by carving out the specialized and potentially severe liabilities associated with MSPA. Underwriters should verify that this endorsement is attached to policies for all eligible farm risks.
• Risk Assessment: The use of this form highlights the insurer's intent not to cover employment-related statutory obligations specific to this class of worker under the general liability provisions. Underwriters should assess the farm's labor practices as part of the overall risk assessment, even with this exclusion in place, as poor practices could lead to other types of claims that may still be covered.
• No Coverage for Penalties: It's important to emphasize that this exclusion applies to damages and any awards or costs stemming from MSPA. This would typically include civil money penalties assessed under the Act.