Many factors should be taken into account when choosing equine insurance and getting the right coverage at an affordable price.
When it comes to choosing equine insurance, getting the right coverage at an affordable price can sometimes be a daunting process. Here are some tips that you need to keep in mind when making a decision about equine insurance coverage, whether you’re insuring a single horse or an entire herd.
Tip #1: Find The Right Agent
Because of the unique nature of equine insurance, it is important to find an agent who knows the horse business. But that’s not the only thing to look for. When entering into any business transaction, it’s vital to find someone you can trust. You want to work with an agent who knows the horse business, is familiar with the events and knows the value of something like winning a futurity. Therefore, it is advisable to partner with an agent who has an expertise in your horse’s breed and/or discipline and ask around for recommendations for an agent from someone who has done business with that agent before.
You also want to be sure that your agent helps you understand what you are purchasing and helps you find the right coverage for your needs.
Tip #2: Get Insured To Transfer Risk
Insurance is an important part of any business or individual’s financial foundation. Many horse owners learn the hard way that opting against insurance can be costly. Whether it’s footing the bill for colic surgery or absorbing the horse’s value in the unfortunate case of death, horse accidents can be expensive. Buying insurance is one way to help you protect your financial investment. Horses can be some of our biggest assets, so it’s important to be covered correctly.
Most people understand the necessity of carrying homeowner’s insurance, as few could afford to rebuild a house if it burned down, for example. That same logic should apply to horse insurance, which can be defined as “transferring risk.” When a person buys an insurance policy on a horse, the financial risk associated with losing that horse is transferred to the insurance company.
Tip #3: Buy The Right Amount Of Coverage
While items such as houses, barns and vehicles are relatively easy to assess for value, it can be difficult to put a value on a horse. That’s where a specialized equine insurance agent can help.
When it comes to placing a value on your horse, the ultimate decision is made by the insurance underwriter. Your agent is a good resource who will be be familiar enough with the market to help you determine the value.
Many factors are taken into account when assessing a horse’s value. For weanlings being insured by their breeders, generally the stud fee is used as a starting point. As the horse enters training and makes its first start, its value will change. A good insurance agent will adjust those values as time goes on, so you aren’t paying extra premiums on a horse whose value has dropped or aren’t under-insured on your new world champion.
When compared to things like veterinary and farrier bills, training costs and entry fees, horse insurance premiums can be among the lowest lines on an annual budget. Still, there are times that the budget needs a little help. Owners should work with their agent to secure the most coverage they can afford within their limits.
Tip #4: Ask About Deductibles Or Specified Perils Policies
If you are insuring a large number of horses or a handful of high-dollar horses, you may be able to benefit from policies that include deductibles. As with car and health insurance, agreeing to pay a deductible increases the amount of risk you are willing to take on while lowering your premium in the process.
Deductibles are sometimes referred to as self-retention, or the amount of risk you’re going to assume. When you retain more risk, your insurance becomes a bit cheaper.
While deductibles are common when it comes to property and vehicle insurance, they are less common on equine policies. Most carriers require a minimum policy value to write a deductible policy for horses. Still, if you are insuring one or several horses for a large amount of money, it is worth checking into whether or not you can take advantage of a deductible policy.
Another option for insuring large numbers of horses, such as herds of broodmares, are specified peril policies, which can be less expensive than full mortality policies. Typically, specified peril policies cover things such as fire, lightning, transportation and theft – basically, acts of God and accident coverage.
When it comes to the specific coverage that fits each horse and situation, the best thing an owner can do is call their insurance agent and discuss.
Tip #5: Take Advantage Of Discounts
Plenty of people take advantage of multiple-policy discounts on homeowners and car insurance, but don’t forget to check for discounts when it comes to equine insurance by combining farm and ranch, auto and equine mortality with one insurance company. Even though you may not be eligible for a multiple-horse discount, if the total value of your stock exceeds a certain amount, you could be eligible for threshold discounts.
This article is intended for general information purposes only, and should not be construed as advice or opinions on any specific facts or circumstances. The content of this article is made available on an “as is” basis, without warranty of any kind. This publication is not intended to be legal, underwriting, or any other type of professional advice. Persons requiring advice should consult an independent adviser.
Courtesy of American Quarter Horse Association