The Raw Milk Gamble
By Dairy Today Editors
With some consumers willing to pay up to $10 per gallon for raw milk straight out of the bulk tank, the temptation to sell it to them can be overpowering for dairy producers.
Before you do, however, consider the financial liability. Most producers, if they’ve even thought about, assume their farm liability insurance will provide protection should a customer become ill and sue for damages.
Not true, says Ted Radintz, Animal Health Outreach Coordinator for the Minnesota Department of Agriculture. General farm liability insurance will not cover a claim from a farm’s customer who has filed a lawsuit over a product purchased at the farm.
Even farm product liability insurance, a specific rider designed to offer coverage of products sold directly off the farm, typically won’t cover raw milk, says Radintz. “One insurance underwriter told me the premium required to cover raw milk isn’t worth the risk,” he says.
And, if your insurance company discovers a producer is selling raw milk, the company can deny coverage, cancel the policy or will not renew it, he says.
Lenders might also step in. While a lender cannot discriminate against a producer for the product he or she decides to sell, the lender can require the producer to have insurance to protect the lender’s secured position.
“As a result of all this, a raw milk producer is only one unfortunate event away from losing the farm and personal property,” says Radintz.