Thank you all for your replies! We are planning on having a light hearted discussion with them about it in the hope they will contain their chickens. We do have a dog but he's useless as we have obviously trained him not to attack our own chickens!
For the person who suggested wire, horses and wire do not mix!
If talking to them fails to work then yes, we are insured with NFU and for some reason it'd never crossed my mind to call them up and ask. I guess that will be the next plan of action. We have a LOT of rabbits here despite my husband shooting up to 30 a week (they all come from neighbouring plots to - no one seems to deal with their burrows!), the biggest issue with this is that they have chewed through even our wire chicken run before now, so any fence is going to need some maintenance to keep it chicken proof!
I honestly though that living on a small holding would be this wonderful and idyllic life. The reality is that we are at war with the rabbits (and seriously out of pocket with their resulting damage), at war with two of our neighbours already, one up the road wants us to dig up half our front paddock to make a 'sink' for water so HIS house doesn't flood, he won't dig his own ditch on his own land because he doesn't want to waste space! The other is our adjacent neighbour who is trying to sue us over the ditch which separates us. They want to dig it out from OUR side, thus turfing up all our land, want us to take all the soil and pay all the costs - oh and they can MAKE us do it apparently because it's their ditch?! Needless to say this has been going on since April and we've had no legal letter, it appears to be all verbal bullying which we are ignoring. The idea of falling out with another neighbour is almost too much!