HORSE INSURANCE

These notes have been prepared by us to assist owners in understanding the various types of insurance cover that are available for their horses.

Purpose of Insurance
The old adage ‘don’t purchase a horse unless you can afford the loss and the purchase  price’ may still be correct but other unforeseen costs may arise.
The purchase of any insurance cover is to protect the policyholder against unexpected loss. With horses this loss may take various forms including accidental injury, death, veterinary treatment or injury to third parties. There are many types of policy cover available and these will vary from company to company. As a general rule the owner gets what they pay for and the difference in premiums charged by the insurance usually reflects the different levels of cover. It is, of course, the responsibility of the owner to ensure that the cover that they take out is adequate for their needs. If in doubt they should consult their independent insurance broker or obtain several quotations and compare the levels of cover and of service offered.

Specific Types of Cover

1. Third Party Insurance
   This will cover the horse against claims resulting from injury to other persons or property. For example, if your horse breaks out of a field and causes a car crash or if your pony kicks a child in the livery yard at which he is stabled then the owners of the car or the parents of the child might sue you for damages. If this is the case these claims would be covered by a third party insurance policy. This level of insurance is considered absolutely essential for all animal owners and may well be provided by your own household insurance cover.
2. All Risks Mortality
   Also known as Accidental Death.
   This covers the horse against claims for the value of the individual in case of death by severe disease or accident. It is a limited form of insurance and does not normally, for example, cover the loss of a horse after prolonged treatment such as navicular disease or arthritis. Policies vary but in essence the horse in only covered if it is found dead or it if has to be humanely destroyed as a matter of emergency due to an excessive and incurable condition such as a broken leg or incurable colic. Owners must be aware that this is a limited form of insurance with many exclusions. Many insurance companies will require a 2-stage vetting certificate for this.
3. Veterinary Fee Cover
   This cover will reimburse the owner for non-routine veterinary treatment following accident or illness to their horse. The amount of cover available for each incident will depend on the various polices and is designed to provide cover for the unexpected costs of treatment following disease, accident or injury. Owners should ensure that the total available for any one incident is sufficient to cover the worst possible scenario. Current figures would suggest that it is prudent to insure your horse or pony for up to £5,000 per incident to cover all forms of major treatment available. Limited cover for only a few hundred pounds or even £1-2,000 will not, in the event of a more serious condition, such as colic surgery, provide the cover that you hope for. Taking out such cover enables your horse to benefit from the major advances in veterinary medicine and surgery that have been made over the last few decades. It is not uncommon following an injury for the insurance company to put an exclusion on any new policy for that condition.
4. So called Catastrophic Vet Fees
   This is insurance against severe and potentially expensive vet fees, usually between £500 - £5,000 usually. It has a considerably higher excess to pay however it does considerably lower your premium.
5. Loss of Use Cover
   This cover provides you for reimbursement of your loss if your horse is no longer able to perform its stated insured use following accident, illness or disease. Strictly speaking, there are at least two forms of loss of use cover currently available and owners should be clear in their own mind which they require before they take out an insurance policy. The cheaper form does not provide the same level of cover as the more comprehensive type of policy.
   The full loss of use cover provides protection against the effects of  any accident, illness or disease leading to your horse becoming permanently unable to carry out the previously agreed roles for which you have insured the horse. It is important that when you open your policy you inform the company exactly what activities you will be doing with your horse. These policies will offer you varying amounts of his total insured value if the horse is no longer able to, for example, event but may still be able to hack satisfactorily.
    The limited form of loss of use cover, which should perhaps be more accurately known as accidental incapacity insurance, provides cover for loss of use following external accidental injury only. Owners should be certain in advance that they require this limited form of cover. Most underwriters no longer provide this cover.
   It is now a condition of all insurers that any horse that is the subject of a loss of use claim will be positively identified by freeze brand which is a white “L” within a circle. Note horses coming from Holland will be marked with an “A”.

When should you insure?
It is always a wise and cost efficient decision to ask an experienced veterinary surgeon to examine the horse prior to purchase and to advise you as to your chosen horse’s suitability for your particular use. This form of examination may also be very useful when proposing your horse for insurance cover. Do be aware however, that it is perfectly possible that a horse may “pass” a vetting yet an insurance company may make various exclusions on the cover available, due to pre-existing conditions. If in any doubt you are strongly advised to obtain satisfactory insurance cover prior to purchasing you horse.

Depending on the value of the horse some companies may request either an annual veterinary examination and/or an owner’s declaration of health before the horse is reinsured. It is worth noting that horse insurance policies run for one year and if renewed are a separate contract. Unlike medical insurance they do not at the present time run automatically for the life of the horse. This means that if a horse sustains an injury you have one years worth of veterinary treatment for this condition even if you are onto a new policy.

Your insurance cover for your horse is a legal contract between you, the proposer, and the insurance company. It is based on the fact that all known facts have been declared and your policy may be invalidated if you do not disclose all pertinent facts that you know or should have known before you insure. If in any doubt it is policy to discuss any matters that may be relevant before you take out the policy. Further information should be available for either your insurance broker or from the individual insurance companies concerned.

When and how should you make a claim?
It is your duty as a policy holder to inform the insurance company as soon as possible that your horse has been injured, lost or is suffering from an illness or disease. Once notified varying insurance companies may initiate different procedures but they will all ask you to show that you have actually sustained a loss (i.e. documentary evidence of veterinary fees already paid) and they may well ask you and your veterinary surgeon to complete an appropriate claim form. You should note that the insured policy holder is only covered for a loss already sustained and legally cannot therefore claim for, for example, veterinary fees that have not yet been paid. However most insured companies will, with prior notification, work together with the insured to minimise the distress and inconvenience of any loss.

If you have any further queries about insurance please contact one of the equine vets.