Understanding Why Tractor Damage from Poor Grounding and Galvanic Corrosion May Not Be Covered by Insurance

As an independent insurance adjuster, one of the most important aspects of our work is to evaluate claims with a clear understanding of what is and isn’t covered under a policy. A case that might seem straightforward at first glance can quickly reveal complications due to specific policy language or exclusions. One such scenario involves a tractor that experiences damage due to poor grounding, leading to errant electrical current and galvanic corrosion.

Let’s break down why this may not be covered under a typical insurance policy.

What Happened?

In this case, the tractor’s electrical system was compromised due to poor grounding, resulting in errant electrical current flowing through the tractor's metal components. Over time, this led to galvanic corrosion – a process in which different metals (in this case, parts of the tractor) react when exposed to moisture and an electrical charge, causing accelerated wear and degradation.

While it’s easy to see how the damage would be frustrating for the tractor owner, the key here is that this type of damage is often excluded from coverage under many insurance policies. To understand why, let's dive into a few key concepts.

Poor Grounding and Electrical Issues: A Preventable Cause

Insurance policies generally cover damage caused by sudden and accidental events, such as storms, fires, or collisions. However, when the cause of the damage is a result of preventable conditions, like improper maintenance or poor grounding, it often falls outside of coverage.

If a tractor’s electrical system was not properly grounded or maintained, leading to errant current flow and eventual corrosion, the damage is typically seen as the result of neglect rather than an unforeseen event. In other words, it's considered avoidable by routine maintenance and proper setup. Most insurance policies will not cover damages caused by poor maintenance, wear and tear, or issues arising from long-term neglect.

Galvanic Corrosion: A Natural, Yet Unwanted, Process

Galvanic corrosion is a natural chemical process that occurs when two different metals, typically one more noble (like copper) and one less noble (like steel), come into contact in the presence of moisture and an electrical current. While it’s not an immediate failure, over time this corrosion weakens metal components, leading to potential failures.

The issue here is that galvanic corrosion generally isn’t considered a “sudden and accidental” event. It's a gradual process that develops over time, making it harder for the insurance provider to justify as a covered loss. Insurance companies are more likely to cover an incident where the cause of damage is immediate and unexpected rather than the slow, cumulative damage from ongoing issues like galvanic corrosion.

Typical Policy Exclusions

Most farm or commercial vehicle policies contain exclusions related to the following:

Maintenance issues: As mentioned earlier, damage resulting from poor maintenance or lack of care typically won’t be covered. This includes improper grounding or failure to address electrical issues before they lead to damage.
Wear and tear: Many policies specifically exclude damage caused by normal wear and tear. Corrosion falls squarely into this category since it often occurs slowly over time and is exacerbated by factors like neglect or improper storage.
Gradual damage: Insurance is generally designed to cover sudden and unexpected events. Gradual, long-term issues like corrosion typically don't qualify, as they are seen as inevitable and avoidable with proper care.

Preventing Similar Issues

While a tractor’s electrical system and components can experience issues from improper grounding or corrosion, there are steps that can be taken to prevent these types of problems:

Routine Inspections: Regular checks of the electrical system can help catch problems before they lead to more serious damage. Make sure the tractor is grounded properly, and all electrical connections are clean and free of corrosion.
Proper Storage: If the tractor is exposed to the elements, consider proper protection against moisture buildup that could accelerate corrosion.
Maintenance: Keeping up with the manufacturer’s maintenance recommendations will help avoid issues related to electrical systems, grounding, and corrosion.
Electrical Protection: Using grounding systems and surge protectors can help prevent electrical issues that could cause damage over time.

Conclusion

While it’s always unfortunate when equipment breaks down, it’s important to recognize the limits of insurance coverage. In the case of a tractor damaged by poor grounding and galvanic corrosion, many policies would likely consider this preventable damage and thus not covered under the terms of the policy. As an independent adjuster, it’s essential to carefully evaluate the circumstances surrounding the claim and communicate clearly with the insured party about the reasons their claim may not qualify for reimbursement.

Educating clients about proper maintenance, grounding, and corrosion prevention can save them from unexpected issues down the road and help avoid similar claims in the future.

How I tested for bad ground on this claim:

Using a Fluke 77-III multimeter to do electrical testing, the probe is placed on several areas on the tractor to measure current. I tested the garage breaker panel and ground post first, to eliminate the possibility that the tractor was picking up stray voltage from the ground if its bucket or backhoe were parked directly on the ground. There was no voltage to ground from the panel.

I next tested the battery voltage, 12.4 VDC, which is perfectly normal. I noted that the negative terminal was corroded, and the positive terminal looked brand new. I left one lead on the negative battery terminal and went hunting for stray voltage. Anywhere I touched the machine frame and fittings – the common reference point previously mentioned - should have read zero (0.000) voltage if properly grounded. It is not. For confirmation, I tested a spot on the right side where the front frame bolts to the main frame near the engine oil pan. Those bolts look perfectly normal. I got no voltage at that spot. Nearby, the hydraulic connections for the font end loader are some of the most corroded on the tractor. Touching the lead to the end fitting on the hydraulic hose with rust on it gave a voltage of .031. Other places would read a high number at first touch and then quickly diminish to between .006 and .003 VDC, which confirms the voltage is so low that the meter is acting as a sink. Nevertheless, there is voltage where there should not be.

Tom Fergus handles claims for forestry, farm, construction, and specialty equipment. Service area is all of New England (except Rhode Island), New York: Upstate, Long Island, and Finger Lakes. Desk review on complicated claims outside of my area. Click here to see my mobile office to make handling long-distance claims efficient for my customers.