Horse Insurance 101
Updated June 6, 2023 | By: Amy J. Daum, a partner at Broadstone Equine Insurance Agency which has over two decades of experience specializing in equine coverage nationwide.
Is Horse Insurance Worth It?
Horse health insurance falls way to the bottom of the list of topics any horse owner wants to discuss. Discussing worst-case scenarios doesn’t make for enjoyable barn aisle or ringside small talk.
Unfortunately, as in many areas of life, what you don’t know can hurt you. In the interest of helping you protect your investments, especially in these tough economic times, here is some information that might help you consider putting “Get Horse Insurance” on your to-do list.
Equine Insurance Basics
The basic idea behind insurance is that you are paying a fee to an insurance company to transfer your risk of loss to them. Your burden of payment is significantly less than the amount the company has agreed to pay if such a loss happens.
Insurance can be a cost-effective way to mitigate your risk if you cannot afford to replace your horse in the event of a loss or the costs of veterinary care for a severe illness or injury.
For many of us, horses are our best friends, and we do not want to be in a situation where financial considerations dictate the quality of care. Even if you have the funds to absorb these losses, you may still choose to invest each year on horse insurance premiums so you are not forced to tap into your savings if the unexpected happens. When it comes to horse insurance, there are several options. The two most common are Full Mortality and Major Medical/Surgical.
Full Mortality Insurance
The equine Full Mortality policy is your horse's equivalent of life insurance. It provides coverage if the insured horse dies or is humanely put to sleep due to a covered accident, injury, illness, or disease and usually has limited coverage for theft. Full Mortality coverage is available for horses aged 24 hours up to 20 years old, depending on the insurance company. Premiums are based on the horse’s age, breed, use, level, and insured value.
What Does Full Mortality Horse Insurance Cost?
The rates for Full Mortality coverage for the average pleasure or competition horse—uses that would include English/Western Show, Dressage, Hunter/Jumper, Cutting, Reining, Roping, Barrels—ages 1–15 years, generally range from 2.9–3.6% of the horse’s insured value. So the Mortality premium for a horse insured at $10,000 would average between $290 – $360 a year. Rates for some uses, such as eventing, fox hunting, and endurance, are usually slightly higher due to increased risk of injury.
Colic Surgery Coverage
Typically Mortality policies include Emergency Colic Surgery coverage between $2,500-$5,000, depending on the horse’s insured value and the insurance company. It’s estimated that 900,000 horses colic annually in the U.S. SmartPak’s ColiCare program reimburses up to $15,000, is compatible with equine insurance, and covers senior horses.
What Isn’t Covered By Full Mortality Insurance?
Full Mortality coverage is comprehensive, but exact coverage terms vary by company. Standard exclusions (reasons a claim could be denied) include pre-existing conditions, purposely harming the horse, not utilizing the services of a licensed veterinarian, late reporting of a loss, failure to meet the company’s requirements after the loss, and some pretty far fetched possibilities such as war, destruction of the horse due to government order, and nuclear radiation.
Major Medical and Surgical Horse Insurance
This is the most popular coverage horse owners add to their Mortality policy and is not available on a standalone basis. It helps reimburse for covered medical and surgical expenses if the horse suffers a covered accident, injury, illness, or disease during the policy period.
What Does Major Medical Horse Insurance Cost?
For as little as $200 annually, Major Medical can provide an aggregate limit of $5,000 for the policy period, with deductibles as low as $300 per claim. Higher annual limits of $7,500, $10,000, $12,500, and $15,000 are available with many companies, with varying deductibles and annual premiums ranging from $300 to $675 or higher.
What is Covered by Major Medical Insurance
If your horse is colicking, founders, runs through a fence, gets kicked, develops a lameness, or suffers any of the other countless injuries or illnesses that can keep you up at night, Major Medical should help reimburse for covered expenses after the deductible is met. The coverage details vary depending on the insurance company, so ask your horse insurance specialist about exclusions, co-pays, treatment time limits, and extension periods.
What Isn’t Covered By Major Medical Insurance?
Major Medical does not provide for routine health maintenance or preventative care such as vaccinations, deworming, dental or farrier care. Other standard exclusions can include pre-existing conditions, elective or cosmetic surgery, performance-enhancing treatments, joint injections, integrative therapies, the veterinarian’s call charge, or transportation costs.
Major Medical Insurance for Pleasure Horses
Think your horse wouldn’t be a candidate for Major Medical because he is a pleasure horse, or you only paid a couple of hundred dollars for him? While some companies will not offer coverage on lower-valued horses, a few do not have restrictions on the amount of Major Medical coverage they offer, regardless of the horse’s insured value on the Mortality policy.
Cautions for Horse Health Insurance Policies
Horse insurance is very different from human health insurance. For example, pre-existing conditions are not covered, even if the horse was insured when it first contracted the disease or condition. For instance, if your horse develops a lameness or requires colic surgery while insured, expect to see an exclusion for that health issue on the following year’s policy. This is because the policies are reviewed and underwritten each year. Therefore, the condition would be considered pre-existing and excluded from the new policy. However, there are typically extension periods built into the policy for issues that continue beyond the original policy’s expiration.
You must contact the insurance company as soon as a health issue presents itself. The policy requires it, and you could jeopardize your coverage if you fail to report the problem promptly. The claims adjuster will explain the coverage in detail, allowing you to plan with your vet appropriately.
Picking the Right Horse Insurance Specialists
Deciding what coverage to purchase is quite important. While the basics are similar, the coverage varies depending on the insurance company. The number of U.S. insurance companies offering horse health insurance policies doesn’t even reach double digits. However, there are many insurance agencies. Here are some important considerations when picking the right company and policy:
- Consider cost and coverage.
- Find a specialist who will answer your questions promptly.
- Find an agent who is an experienced horse person.
- Ask about 24/7 emergency contact availability.
Peace of Mind for Your Horse
There is no doubt that pondering all the worst-case scenarios of horse ownership is uncomfortable at best, which is another reason to consider insurance. Knowing that you’re covered in case of the unthinkable buys you more than financial security—it also gives your peace of mind.