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A spate of header fires could prompt insurance companies to hike premiums — or even refuse to cover harvesters, according to peak harvest contract body Australian Custom Harvesters.
Campbell Fuller, Insurance Council of Australia spokesman, said several insurers were still offering cover for harvest equipment despite the headers having a “high risk of fire damage,” according to a Weekly Times report.
He said that one insurer, however, “has signalled to brokers that it will no longer operate in the Australian agricultural market after April.”
Last year, there were at least four serious fires caused by headers in Victoria. The state had seen increased harvesting of legumes such as lentils and chick peas, which are more flammable than cereal crops, the report said.
In NSW, there has been a rise in fire damage from header fires according to fire authorities, including a West Wyalong fire that razed 7000 ha and caused $500,000 in crop losses.
About seven per cent of harvesters a year catch fire, according to a recent study by Grains Research and Development Corporation and Kondinin Group. In these cases, one in 10 will result in major damages to the machine or surrounding crop, The Weekly Times said.
Trevor Verlin, Australian Custom Harvesters executive officer, said his association has been making efforts to reduce header fires. He was worried, however, by the insurance industry's concern about the risks.
“We do know fewer and fewer of the underwriters have been interested in taking on the risk of harvesters, as they do sometimes catch on fire,” he said.
An insurance agent told him recently that “there would not be an underwriter that would cover harvesters.”
“This has the potential to have a significant impact on the ability to harvest the crop,” Verlin said. “The grains industry is increasingly relying on professionals to come in and take off the crop quickly.”
Andrew Weidemann, Grain Producers Australia chairman, was working with the industry to address the issue, the report said.
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