It’s no secret that today’s business world is firmly planted in the land of technology and information. New developments seemingly happen every day. The farm equipment industry does not isolate itself from data and electronic advancements. Quite the contrary—it is seizing the opportunity to turn these exciting developments into valuable new services for customers.
Precision agriculture is more and more commonplace. As data become available and their quality improves, harvesting value from that data is the ultimate objective.
As the scope of dealers’ involvement in their customers’ operations continues to expand, many may have already found themselves providing quasi-agronomic advice or even full-scale agronomy services. Providing technological expertise in precision agriculture may be very different today than it was just a few short years ago. Precision agronomic services can create additional risks. Therefore, some best practices may help protect your dealership from liability claims.
Understand Professional Services
Individuals who have specialized knowledge in a particular field, such as agronomy, and provide opinions and make decisions, by their very nature expose themselves to what is commonly referred to as professional liability. These individuals are expected to have the required minimum skill and competence as others in their respective field. Otherwise, when errors are made, the result may be financial harm to others.
Be intentional when you define each of your employees’ roles. The employee’s job may present opportunities to “render professional advice,” but it is the advice itself, not the position, which determines professional liability. Authorize specific individual(s) in your organization to provide such advice and direct your customers to them.
Know Your Expertise
Actively follow and understand developments and changes in the industry to help keep knowledge and skills current. Having, understanding, and utilizing the required level of competence can help avoid allegations of professional negligence. Where appropriate, get and maintain independent professional certifications and registrations.
When providing agronomy advice, open communication and careful attention to detail are active ingredients for building strong, cooperative business relationships. A clear understanding of each party’s role and expectations can help you avoid misunderstandings and mistakes, which could lead to costly claims and potential litigation.
Put It In Writing
A written agreement or contract outlining roles and expectations can benefit all invested in the relationship. It helps clarify understanding of what is expected and allows parties to accept that responsibility. Consult qualified legal counsel for help developing documents of this type. Their assistance can help avoid unclear and confusing arrangements.
Detailed records can be valuable risk management tools. They can help clarify expectations and prove each party’s fulfillment of those expectations. Be thorough and committed to identifying, classifying, preserving, and securing both paper and electronic records.
Completely eliminating all possible risk in business is simply not realistic. Therefore, it is important to do what you can to help protect your dealership from potential harm. A general liability policy is designed to provide coverage for third-party bodily injury or property damage, and typically does not include professional liability exposures. Carrying specialized insurance coverage is a feasible option. Your insurance advisor can ensure you have the proper protection in place.
So, what’s my advice? Be aware. Understand your responsibility in providing agronomy advice. If your dealership views it as a potential liability, you can manage and lessen your exposures to help prevent and reduce losses.
Laramie Sandquist, CPCU, ARM
Federated Mutual Insurance Company
This article is for general information and risk prevention only and should not be considered legal or other expert advice. The recommendations presented may help reduce the risk of loss, but are not guaranteed to do so. The information may be subject to state or federal laws or regulations and is not a substitute for any that may apply. The information is current as of January 2017 and is subject to change. All products and services not available in all states. Qualified counsel should be sought with questions specific to your circumstances. © 2017 Federated Mutual Insurance Company.