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magazine for northwest sporthorse enthusiasts |
NEW ARTICLE
Insurance Insights
Should You Insure Your Horse
Nikki James, C.V.T.
Have you ever wondered what you would do if your horse sustained an injury that would cost thousands to repair? Have you ever stood in your barn aisle agonizing over whether or not to send your horse for colic surgery because of the expense? If the answer to either of these questions is yes, you should consider equine insurance. Though it’s not for everyone, insuring your equine companion can create real peace of mind for you and your pocketbook.
There are many things to consider when deciding what type of insurance may be most suitable for you and your horse. These include premium cost, value of your horse, what your horse is used for, and extent of coverage. In this article I will outline the basic types of insurance, tell you how they work, and give you a general idea of cost. This should help to give you the tools you need to make an educated decision about which insurance is best for you.
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Major Medical Insurance |
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How it works: You can only obtain major medical/surgical insurance if your horse is insured for mortality. You pay a premium, usually yearly, in exchange for a designated level of coverage should your horse become sick or injured. Requirements: Completed application, veterinary examination and mortality policy. What it costs: Generally $150 to $200 yearly for up to $7,500 coverage. Keep in mind that there is usually a deductible associated with each claim, therefore having insurance doesn’t mean you will never pay another vet bill. Your horse may have a minor cut or scratch that requires a $150 trip to the vet, but is not worthy of making a claim against your insurance and paying a $250 deductible. |
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Mortality Insurance |
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How it works: It works a bit like life insurance for people. The insurance company insures your horse based upon his agreed value. In the event of his death, the insurance company will pay you that sum of money. Generally there will be some contract requirements you must fulfill before you will be paid, such as proof of veterinary treatment and necropsy (the animal version of an autopsy) results revealing cause of death. Requirements: Completed application and veterinary exam for horses valued over $50,000. For horses valued $50,000 and below generally a veterinary examination is not required. For many companies, horses must be between the ages of 31 days and 16 years and must not compete in Polo or flat racing activities. What it costs: Approximately 3-5% of your horse’s agreed value. |
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Stallion Infertility Insurance |
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How it works: Similar to loss of use insurance, this coverage helps to compensate you if your stallion should sustain an injury or aquire an illness that would render him infertile. However, different than the 50% - 75% of value paid on the performance horse loss of use policy, the insurance company may pay up to 100% of the stallion’s value, due under the Mortality policy. Requirements: Mortality policy, completed application and veterinary examination including semen count. What it costs: Annual premiums are approximately 0.5% to 2% of the stallion’s insured value. |
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PreventiCare™ |
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How it works: PreventiCare™ doesn’t charge a premium. Instead, Pfizer requires you to follow specific guidelines to be eligible for benefits. You must maintain your horse on daily Strongid C™ dewormer purchased from the enrolling veterinarian, and keep your horse up-to-date on vaccinations and dental care to qualify. When you keep your horse active in the PreventiCare™ program, Pfizer will pay $5,000 towards the bill if your horse should undergo colic surgery. The cost for this program is minimal, considering you are paying your veterinarian for vaccinations and dentistry anyway. Requirements: Must be between the ages of 6 months and 20 years to enroll. Must have veterinary examination and dental care performed once per year. Must maintain veterinary recommended vaccination protocol and must be maintained on daily Strongid C™ or Strongid C 2X™ with Equell™ or Equimax ™(Pfizer’s ivermectin dewormer) given twice yearly. What it costs: Approximately $20 to $25 monthly for daily dewormer. |
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Lose of Use Insurance |
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How it works: In the event of severe illness or injury, your veterinarian deems your horse no longer able to perform his insured function. The claim is submitted and the insurance company will then decide whether or not to have a second opinion. Should the insurance company then deem that your situation is truly a loss of use claim, they will help to reimburse you for the loss in your horse’s value. Commonly insurance companies pay you 50% of your horse’s value and you keep the horse, or they will pay 75% of the value and they take your horse. These policies can be a bit difficult to obtain due to their requirements and restrictions, and are specifically designed for performance horses rather than horse used for breeding and pleasure. Requirements: Completed application and veterinary examination. Your horse must have an agreed value of $25,000 or more, be between the ages of 2-12 years old, and must be a performance horse actively competing in Hunter/Jumpers, Dressage, Cutting or Reining. What it costs: Generally loss of use coverage adds about 2.5% - 3.75% of the horse’s declared value on the mortality section of the policy. |
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There are numerous companies that provide equine insurance. It is always best to shop around to find what suits your needs the best. Below are a few names and numbers to help you get your research started.
With all the types of insurance available today, there is undoubtedly something out there that should fit the needs of you and your horse. It is my hope that this information has given you some insight to what is available and will help make the task of purchasing insurance a bit easier. Happy shopping! Note: There are many programs and additions to insurance policies available. This article just covers a few of the basics. Please talk to an insurance agent or your veterinarian to thoroughly explore your options. |
Is Insurance For Me?
This is a common question in my line of work, and the answer really comes down to one simple thing—would you have to go out and look for another horse if your horse died or could no longer do his job? Maybe you would, and maybe you wouldn’t. Maybe you have several horses, and the cost of insuring all of them is overwhelming. Maybe you paid so little for your horse, and though he is a great companion, financially he wouldn’t be hard to replace. These are all things to consider when making your decision. The best advice I can give you is to figure out your finances. It really comes down to how much you can afford to lose if you don’t insure.
If you have several horses, simplify your decision-making by narrowing things down to which horses you would have to replace and which you wouldn’t. For example, you own seven horses—it would be really expensive to insure them all, but they are all valuable to you in one way or another. Which do you insure? Let’s start with the 29 year-old broodmare. You have huge sentimental attachment to her, after all she did give you several of the best horses you have ever ridden, but do you insure her? What is she worth? Can you even get insurance on her at her age? Probably not, and if you could it may not be worth it.
Now let’s talk about horse number two: your 10 year-old daughter’s fancy hunter pony. You got a great deal when you bought him, and though he wasn’t cheap, if you had to go buy a pony like him now—after you have put months of training on him—it would cost you an arm and a leg. You know you would have to find a replacement for him in the event of his loss, but could you afford to? Probably not. The answer here is definitely insure him, and maybe even add loss of use to his policy. After all, if he were permanently injured, wouldn’t it be great to have some financial compensation to help you out with the cost of another pony?
Moving on to the rest of the herd, and the horses you personally ride—there are four of them, and they are all very nice horses. Which do you insure? Can one of them easily fill the shoes of another? Are they valuable enough to insure them all? These are questions only you can answer and with some careful consideration and a calculator, it shouldn’t take you long to figure things out. Remember to ask yourself who you would replace if you had to, and whether or not you could afford to and that should help you decide. It never hurts anything to insure them all—except the pocketbook!
What’s He Worth?
How do you know how much to insure your horse for?
The general rule of thumb about assessing the value of your horse is simple. The purchase price. This is the amount the insurance company will deem reasonable, if you purchased your horse recently. Even if it wasn’t a recent purchase, the price you paid is a starting point. Above that it becomes your job to prove to the insurance company why your horse is worth more than what you paid for him. Insurance companies employ experts to look at show records, breeding records, training bills, etc. to help determine how much the agreed value of your horse should be. Be aware that if you purchase a horse for $10,000 and immediately try to insure him for $20,000, you won’t get very far. However if you keep your training bills and show records over a period of time, and can prove that you have invested that much, the insurance company will likely be happy to raise the value of your horse’s policy.
Another thing to keep in mind is that you are not required to insure your horse for the full amount that he is worth, you can always insure for less. Some people like to carry a minimal mortality insurance policy just to make them eligible for the major medical part of the policy. For example, you may have a horse that you would not run directly out to replace in the case of his loss, however you would like to obtain major medical insurance for him. Taking out a $5,000 mortality policy may be the best way to go and then you are able to add on medical.
Nikki James is a certified veterinary technician with Pacific Crest Sporthorse based in Oregon City, Oregon.
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