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

What the form is

The FP 16 01, titled "Coverage G–Barns, Outbuildings and Other Farm Structures Statement of Values," is a supplementary form used in farm insurance policies. Its primary purpose is to provide a detailed schedule or statement of values for individual barns, outbuildings, and other farm structures that are insured under Coverage G – Other Farm Structures. This form is utilized when these structures are covered on a blanket basis, meaning a single limit of insurance applies to all scheduled structures, rather than specific limits for each. The FP 16 01 helps the insurer and insured agree on the values of the properties covered, which is crucial for determining the appropriate blanket coverage limit and for loss settlement purposes, especially in relation to coinsurance requirements that are often amended by blanket coverage endorsements.

Classes of business it applies to

This form is specifically designed for agricultural or farming operations that have multiple structures beyond the main dwelling. Examples include:

• Commercial farms with numerous barns, silos, sheds, and other outbuildings.
• Ranching operations with stables, equipment storage buildings, and livestock shelters.
• Large agricultural enterprises where itemizing each structure with a specific limit might be cumbersome, making a blanket approach more practical.

For instance, a large dairy farm might use FP 16 01 to list the values of several milking parlors, hay barns, and equipment sheds, all covered under a single blanket limit for Coverage G. This simplifies the policy structure while ensuring all necessary structures are accounted for.

Special considerations

• Use with Blanket Coverage: The FP 16 01 is intrinsically linked to blanket coverage for farm structures. It is typically used with an endorsement like FP 04 28 (Coverage G—Barns, Outbuildings and Other Farm Structures—Blanket Coverage), which modifies the standard valuation and coinsurance clauses to accommodate a blanket limit.
• Accurate Valuation: It is critical that the values declared on this form are accurate and current. Understating values could lead to coinsurance penalties in the event of a partial loss, or insufficient coverage for a total loss. Conversely, overstating values could result in paying excessive premiums.
• Coinsurance Implications: Blanket coverage often has specific coinsurance requirements (e.g., 90% or 100%). The statement of values helps ensure that the blanket limit selected meets these requirements based on the total value of all scheduled structures.
• Updates Required: As the farm operation changes—new structures are built, old ones are demolished, or values change due to improvements or depreciation—the FP 16 01 should be updated accordingly at renewal or via endorsement to maintain accurate coverage.

Key information for agents and underwriters

• Risk Assessment: The detailed listing of structures and their values on FP 16 01 provides underwriters with a clearer picture of the total exposure under Coverage G. This aids in assessing the overall risk profile of the farm and determining appropriate premium rates for the blanket coverage.
• Rate Justification: This form helps justify the blanket rate requested by providing a transparent breakdown of the values being insured.
• Coverage Adequacy: Agents should work closely with insureds to ensure all relevant farm structures are listed and their values are accurately reflected. This helps prevent underinsurance and potential dissatisfaction at the time of a claim.
• Documentation: The FP 16 01 serves as important documentation of the agreed-upon values at the inception of the blanket coverage or at the time of an update. This can be invaluable during claim settlement.
• Pairing with Correct Forms: Ensure FP 16 01 is used with the correct underlying coverage form, typically FP 00 14 (Farm Property–Barns, Outbuildings and Other Farm Structures Coverage Form), and the appropriate blanket endorsement, such as FP 04 28.