Horse InsuranceThe 7 most important questions you need to consider…
Insuring your horse is not only protecting your investment when you purchased the horse, it is also protecting your finances if there is an accident, sickness or disease that needs treated.
Mortality Insurance
This type of insurance provides coverage on the life of the horse and includes theft and some colic surgery. If you are planning to replace your horse in the event of death, you would want mortality insurance to help with the cost. The premium is based on the value of the horse as well as its breed, use and age.
Medical Insurance
Many companies have different medical options available. Sometimes the coverage limit is not more than the horse’s value (or some percentage of it) and some companies offer a set limit regardless of your horse’s value.
Here’s how it works…
So a horse valued at $1,000 could be limited to $1,000 (or less) medical coverage, or you could have a stated amount such as $10,000, or $15,000 – depending on the conditions of the endorsement.
Major Medical
The most popular medical endorsement is major medical (different companies will offer different limits/options) and it covers required treatments and surgeries up to the limit shown on the endorsement.
Surgical-Only
You can also purchase a surgical-only endorsement that provides coverage for required surgeries only (no treatments). Some companies offer colic-only endorsements covering the cost of treatment and/or surgery directly related to colic.
Because companies offer different coverage’s at different prices, it is important to shop around with equine agencies.
Liability Coverage
Another policy to consider is liability coverage. If your horse hurts someone else or damages their property do you have protection under your homeowners policy? Most of the time the answer is no.
You can purchase a Private Horse Owners Liability policy (sometimes called an Individual Horse Owners policy) at a low cost. These policies can have several named horses listed on them.
Do you board your horse at another facility?
If you board your horse at another facility, you still have a liability exposure. If your horse kicks another horse in the barn or he gets out on the road and is hit by a car, you will probably be named in the claim simply because you own the horse.
The injured party will need to prove you were negligent so you will need to defend yourself. How much time will that take and what is your attorney’s hourly fee? For less than $250 a year, you can be covered for up to four horses (more can be added at an additional cost).
Do you offer boarding at your place?
Are you giving lessons or training
(either at your place or at someone else’s farm)?
If so you have a different exposure that needs a specialized policy. You should contact an equine agency to discuss a Commercial Liability policy. This policy can be tailored to your specific needs. It can include coverage for boarding, lessons, training, show, clinics, day camps.
Are you using a release form that is specific to your State’s law?
Many states have an equine liability statute and these can differ from state to state. Some states require release forms to be signed (with specific wording). Some states require you to post warning signs. These statutes are valuable in protecting you but you have to follow them.
If you work with minors, do you know who needs to sign the release forms?
Is it only the parent(s) or does the child need to sign as well? It is important to talk to an attorney to be sure you know your State’s requirements (under the equine law and any statutes regarding release of liability).
Limited Liability Corporation
Have you thought about forming a Limited Liability Corporation to further protect yourself in the event of a claim against you? You should discuss this with your attorney and tax-preparer so you know what the requirements and costs that are involved.
Do you have employees?
Some barns allow their boarders to clean stalls in exchange for lower board or reduced lesson rates. Does this make the boarder an employee?
You need to be sure because most liability policies will exclude an employee from coverage if they are hurt in the course of their employment. Just because money doesn’t change hands doesn’t mean they are not an employee.
Do you have or deal with non-horse people?
What about those of you who are dealing with the general public who are sometimes non-horse people?
Do you give pony rides, do pony birthday parties, rent your horses by the hour for trail riding? These are areas that require an even more specialized policy.
You can find a few agencies/companies that are writing this type of insurance.
How about your homeowner’s policy?
Does it exclude coverage on any building used in a business? If you don’t have an equine-specific policy, you could be lacking in very important coverage – including fire/storm damage to your barn.
Are your barns insured to the proper value?
Some homeowner’s policies are insuring the barns at a percentage of the house value but most horse barns need to be valued higher than that. An equine-specific insurance agent will help you determine the replacement cost of your house and buildings.
Peace of Mind
There are many companies offering equine-specific policies for your home and buildings. They may be more expensive than your current policy but you’ll have the peace of mind knowing that if there is damage or an injury, you have the right coverage.
The last piece of advice –
- Run your equine operation as a business.
(As much as you love your horses and enjoy working with other horses and people, you are running a business.) - If someone gets hurt (even a good friend), they could make a claim against you or their health insurance company can.
- Everyone who will be around the horses should sign a release form.
- Everyone should be treated the same – whether they are relatives, friends, boarders or students.
- You should have rules written out and posted – and be sure to enforce them with everyone.
As a horse owner or a horse business person, you have a lot of responsibility.
Equine insurance agencies are here to help you get the right coverage at the right price so you have peace of mind.
For more information about horse insurance please contact the author or post your questions in the comment section below.
– Susan Strawser
