Mortality Coverage: Life Insurance for Horses
You might own a life insurance policy, the purpose of which
is to help provide for your family or beneficiaries in the event of your death.
An equine mortality policy is similar: If your horse dies or has to be
euthanized, the policyholder receives the amount the horse was insured for,
which is considered to be the current value of the horse. The price you paid
for your horse establishes his value; if you can provide proof that his value
has increased, the insurance company can allow you to increase the policy
amount to cover your horses newly stated value. Proof can be competition
records showing his achievements, extensive training records (especially for
young/ unbroken or green broke horses) or a recent appraisal.
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| Photo Credit: Claire Almendinger |
Mortality insurance gives the horse owner the added
assurance that in the event the horse needs to be euthanized or dies on its own
that the money you have invested in it will be returned, either for a new
purchase or just to recoup the loss of the horse and the money invested in it.
The premium or cost to insure the horse is set by an annual
premium. The annual premium is typically between 3-8% of the horse’s value. If
the horse is valued at $10,000 the annual or yearly premium will be $300 at 3%
or $800 at 8%. Premiums depend on certain factors such as age, breed, the
intending use of animal. Racehorses will cost more to insure than say a
dressage or pleasure horse due to the chances of injury are far great for a
race horse.
Major Medical and Surgical Coverage: Health Insurance for
Horses
The point of major-medical coverage is to reimburse the
policyholder for veterinary costs incurred in the process of diagnosing and
treating illness or injury, including surgery. The horse can be examined and
treated at home, at a veterinary clinic or hospital, or both. Surgical coverage
is not just for surgeries. The name actually refers to the fact that covered
charges must be incurred at a surgical facility. As a result, unless you happen
to live next door to a clinic or hospital, a surgical endorsement is likely to
be more limiting than a major-medical endorsement, which is why it should be
added with Major Medical and not a stand-alone endorsement.
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| Photo Credit: Claire Almendinger |
Other Types Of Coverage: Stallions, broodmares, foals.
Importing/exporting horses
You can buy infertility insurance to protect against the
stud-fee income you won't collect if he experiences a decline in fertility due
to injury, illness, or age or if he is infertile.
Foal policies can be expensive but if you are expecting a
valuable foal this may be the route to choose especially if your breeding
contract doesn’t come with a live foal guarantee. There are different policies
that follow the foal from birth to 24 hours, then from 25 hours up to 30-45
days old. After this time the foal must be issued a standard mortality policy
if you wish to keep it insured.
Loss-of-use coverage is a permanent disability endorsement/
coverage that compensate the policyholder/ owner in the event that his or her
horse becomes unable to perform in his intended discipline. For example a show
jumper tears a ligament and can no longer jump again. Some of these policies
contain language stating the insurer can opt to take possession of the horse
(as fraud protection).
Air-transit coverage protects against loss during air
travel, including import or export between the United States and a foreign
country. So if you are looking to purchase a horse from another country this
may be something to look into.
There are many options to choose from when it comes to
insuring your equine companion. Could you afford to replace your horse out of
pocket in the event of a total loss? If your equine friend needed costly
surgery could you afford the vet bills, surgery, transport, and after care that
would incur? If your show horse were injured beyond its normal use and could no
longer perform could you afford to buy another horse to take its place?
Questions: Bonnie Foord at the MVP Insurance Agency 740-966-3180 bonnie@themvpagency.com
Referenced website: http://www.thehorse.com/articles/28179/equine-insurance-risk-management
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