Higher cattle prices have led many UK farmers to be dangerously insured, leading rural insurance experts have warned.
Lincoln-based Dallas Scott Davy Toby Baker has issued a timely warning after cattle prices have risen sharply over the past year.
He warns that while market value is rising rapidly, many insurance contracts remain outdated and do not reflect current valuations.
“Livestock prices have risen over the past 12 months, and have risen significantly from dairy cows and dairy cows to all classes of cows to store their main fat stocks and calves,” he said.
“However, insurance policies are often unchanged and do not reflect the true current market value of these animals.”
He emphasized that many policies are simply updated annually, without adjusting for dramatic changes in livestock values throughout the year.
“Increasingly, farmers are realizing that existing insurance no longer provides sufficient coverage,” Baker added.
“As cattle prices continue to be strengthened, the gap between market value and insurance value is growing.”
To explain the scale of the change, he pointed out in June 2024 that dead-class prices of 476p per kilogram were considered strong for completed cows.
By May 2025, that figure had risen to about 650p per kilogram. Cattle insured for £1,600 now win £2,400 for £1,600, while premium fat cows have reached over £3,000 in select markets.
Baker also warned of the financial implications of insurance shortages because of the “average” principle of insurance contracts.
“If livestock is under insurance, claims will be reduced proportionately to the shortage,” he explained.
“The outcome can be costly surprises at the worst possible times. Continuous disclosure is legal obligation, and failing to update our policies can lead to significant financial losses.”
Dallas Scott Davy expects cattle prices to fluctuate further over the next two years, making aggressive insurance management even more important.
“While keeping premiums low is attractive, the risk of a lack of insurance can far outweigh the short-term savings,” Baker said.
“We highly recommend daily consideration and discussion with experienced rural insurance advisors to ensure that the cover is appropriate.
“In changing agricultural environments, maintaining accurate insurance coverage is important to protect the financial stability of rural businesses.”
