August 1983: Egg farm buildings insured, but 210,000 chickens aren't

A southern Indiana egg farm is insured for the $3 million in buildings and equipment destroyed in a fire last month, but not for the 210,000 chickens that died in the blaze.

The July 22 fire destroyed six chicken houses and an egg processing building at Egg Acres, an egg-laying division of Acme-based Rose Acre Farms. Half of the complex – six chicken houses – remains.

“It took about 10 to 15 minutes to burn everything down,” said Jack McCory, controller for Rose Acres. “Then the firemen were there the rest of the night to keep the rest of the complex from burning.”

The Jackson County, Ind., sheriff’s department said the fire was caused by faulty electrical wiring.

Rose Acre Farms has $13 million in all-risk coverage after a $100,000 deductible. The first $10 million was written by Industrial Indemnity Co., a San Francisco-based affiliate of Crum & Forster, through Industrial Underwriters Inc., a specialty lines marketer also owned by Crum & Forster.

A $3 million excess policy was written by Pacific Mutual Marine.

Both policies were brokered by Williams Insurance Agency in Brownsburg, Ind.

However, the policies do not cover lost chickens or eggs nor business interruption expenses, says Mr. McCory.

“We didn’t think it was feasible to insure the chickens,” said Mr. McCory, who could not estimate the value of the poultry killed in the fire. “Things like this happen once in a lifetime … or maybe twice.”

Mr. McCory added that Rose Acre Farms does not plan to insure its chickens in the future, despite its loss.

“You can pay $200,000 or $300,000 a year to insure chickens,” he said. “If nothing happens in 10 years, you already have $2 million or $3 million invested. It’s not feasible.”

The above article was first published in the Aug. 1, 1983, edition of Business Insurance. To read the full article and to access complete, searchable copies of Business Insurance going back the magazine’s launch in 1967, click here.