​Times are hard, but agri-tourism businesses should remain optimistic

Glamping Blog

By Malcolm Cawsey at ERS

These are testing times for the UK’s tourism industry. Tourist amenities everywhere have been forced to close their doors to the public to help prevent the further spread of Coronavirus, while future bookings have been cancelled on mass by housebound holidaymakers uncertain about when the pandemic will start to subside.

The industry today includes a significant number of farms that have diversified into ‘agri-tourism’ to provide a handy second income stream. We recently carried out a widespread study of the UK farming community which found that 15% of farms have made the move into tourism – that’s around one in seven UK farms that now offer some form of tourist amenities, from guest accommodation and campsites through to fruit and vegetable picking sessions or petting zoos.

Agri-tourism itself forms part of a broader trend towards diversification on farms, which has, over the past decade, proven to be a useful risk mitigation strategy for farms struggling to maintain profitability. Our research – which was carried out just prior to the onset of COVID-19 – showed that diversified farms typically make 44% of their income from non-agricultural activities.

When the current restrictions are lifted we should expect to see a surge in domestic tourism, particularly given that the market for overseas leisure travel looks likely to be depressed for a long time to come. If time and resources allow – and admittedly, it’s a big ‘if’ – the next few months could actually be a great time for a farm to diversify or expand its tourism facilities.

Through our network of dedicated agricultural brokers, we support a wide range of agri-tourism businesses, providing bespoke vehicle cover that takes into account the unique and multi-faceted nature of each customers’ day-to-day operations. For example, a tractor used to drive children around a farm will require carry a different level of risk to a tractor used by a skilled farmhand – this is the sort of detail we can factor into the policies we provide.

Similarly, the risk profile of the farm may increase if there are tourists/visitors regularly wandering around the estate unsupervised. Again, our specialist underwriters have years of experience working with customers to create policies that leave no stone unturned, giving farmers one less thing to worry about as they go about their busy working lives.

When we surveyed farmers at the start of the year, we found that more than one third of farms considering future diversification identified tourism as their most likely pathway. COVID-19 may have caused a big shock to the system, but once we make it through the crisis, agri-tourism could yet be their recipe for success.

If you’re interested in learning more about how agriculture and rural businesses are diversifying – and the changing profile of their vehicle and machinery needs – download a copy of our new report, ‘Agriculture: The Changing Landscape’.

If you have any questions on Agriculture motor insurance, or are looking for support please contact our specialist team on agriculturequotes@ers.com

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