Horse Insurance: Understanding the Basics.

As you know, insurance policies are designed to protect your investments and to help with costs, should the worst happen. As a horse owner, your horse is likely to rate as one of your most valuable possessions, so with that in mind, have you considered insuring your horse?

Equine insurance is becoming more popular and can offer peace of mind and support in difficult situations with your horse. Should your horse die unexpectedly, be stolen, or become injured or no longer able to perform his intended purpose, an insurance policy can help offset the financial burden. Policies vary from provider to provider so you should always talk through the options, in detail. Don’t hesitate to go through the policy, line by line, with a company representative before committing to any contract. Note that policies generally tend to increase in line with the options you choose to cover. But what, in general, does horse insurance cover?

Equine Mortality & Theft

Reining is a high performance sport.*

The basic level of coverage offered by companies offering equine insurance are the mortality/theft policy. It is normally essential before any additional coverage can be purchased.

If you are applying for insurance shortly after purchasing a horse, its insurance value will be assigned based on the horse’s purchase price. In the case of a horse which increases in value, attributes such as earnings, a show record, breeding income and/or training expenses, can be added onto the insured value. If the horse’s value decreases, this must also be adjusted. The coverage (In theory) entitles the policy holder to:

  • The fully insured value if the horse dies or is stolen. (Unless this is due to intentional neglect or abuse. Other exclusions may apply, depending on the policy.)
  • Limited coverage has exclusions depending on the policy
  • Full coverage includes death due to acts of God (earthquakes, for example), humane destruction and other causes.

Your premium will vary depending on the value of the horse, the policy you’ve selected and any pre-existing terms and conditions. It is a good idea to phone a few different insurance providers to compare quotes before committing to a contract.

Major Medical Insurance For Horses

One of the most common reasons for taking out insurance are the continued rising costs of veterinary treatment. Whether this involves lameness, injury and/or colic treatment, investigatory diagnosis prior to treatment can quickly become prohibitive. (We encourage you to develop a long term relationship with a great DVM, so, that in these instances, your vet will be more inclined to offer you payments if necessary. Also, most veterinarians accept credit cards. If you’re a horse owner, you should keep your credit updated and have a spare card for emergencies!) However, by opting for major medical coverage, this may help ease the financial burden of veterinary treatment. To qualify for major medical coverage, your horse must first be covered under a mortality/theft policy.

Premiums are determined by the policy limit you select. You can select a policy limit from anywhere between $2,500 and $10,000. It is estimated that most colic patients go home with an average bill of $3,500 to $5,500. You may be obligated to handle several thousand dollars in additional bills, post incident, demonstrating why major medical is a desirable policy.

Once your horse is insured for major medical, under the rules of the policy, you are required to provide any care necessary to save the horse. This means that should your horse suffer from colic and you opt not to put the horse through the stress of surgery, choosing to euthanize instead, the company isn’t obligated to pay on the policy. However, if you opt for surgery and all means are taken to save the horse but it doesn’t survive, then you’ll be paid on the policy.

It should be noted that all major medical policies have deductibles which vary from company to company. Pre-existing conditions, elective surgeries, and routine veterinary care such as immunizations aren’t covered.

Accident Sickness Disease (ASD)

ASD refers to insurance which covers investment in breeding stallions. Should a breeding stallion lose his ability to breed due to accident, sickness, or disease, the policy will cover the stallion’s insured value.

Prior to taking out coverage, you’ll be required to demonstrate the horse’s viability as a stallion, including that he has covered mares in at least one breeding season. A semen evaluation by your veterinarian will also is required.

Should your stallion cease being able to breed and you elect to submit a claim to be paid for his insured value, the insurance company will require that the horse be gelded. A
gelding verification form will need to be completed, signed off by both you, the owner and a licensed veterinarian and submitted to your insurance company.

Loss-of-Use Insurance Protection for Horses.

Should your horse be working at a competition level, should he lose his ability to perform, loss of use will be a sensible option on your policy. Due to the high fees incurred, these policies tend to be reserved for performance horses competing at the highest levels of competition for their discipline, such as reining, Western pleasure, or cutting.

Two types of loss of use are available: accidental (limited loss) and full loss.

Accidental or limited loss: This means the insurance pays a percentage of the horse’s total value should an accident leaves the horse unable to be used for his intended purpose.

Full loss: This is where the insurance covers a percentage of your horse’s value in the event of an accident or internal injury, including OCD (osteochondritis dissecans) or navicular disease, leaves the horse unable to be used for his intended purpose.

As you can see, insurance can provide peace of mind regarding surprise expenses. However, should you never need to claim, you will not receive any refund. You should consider your own circumstances and the level at which your horse competes to decide if insurance is for you.

 *Image courtesy of Wikimedia Commons