Canadian COTHers - Q's on insuring youngsters

[Somekindawonderful]

Hoping for some insights on horse insurance from other breeders, ideally those in Canada.

Who do you insure your horses with?
Do you insure youngsters?
Mortality only, or also major medical?
Is paying for “guaranteed renewal” on the policy worth it?
Do you insure for full value on mortality, or just enough so you can qualify to add major medical?

I think it would be wise for me to insure my youngsters; one big vet bill can quickly chew up any profit that might be possible, but I want to know that it is going to be a good value. If I pay insurance premiums, will I still need to keep an emergency fund - which is my current “self-insurance” plan.

What kind of things would major medical coverage actually cover? I have asked for more information from the first insurance company I contacted (HEP) but so far, surprised at the lack of documentation they have to share. Can you share some of your experience, and recommendations on coverage?

[PNWjumper]

My answer to the insure-or-not question is that it depends on how many horses you own and what level you would want to insure them.

For me, I want insurance to cover injuries (not just mortality) if I’m going to pay a bunch of money out every year, and that gets prohibitively expensive for a group of horses. And IME, the couple of times I’ve had a horse insured and they’ve sustained an injury, I’ve received a note shortly after the claim excluding that body part from the insurance policy in the future (even when the injury was not a recurring or major issue). The last time it happened, my mare had a knob on her stifle (from getting caught in a gate a year prior) and we did some x-rays to see what was going on. X-rays concluded that it was a complete and total non-issue. Insurance covered the x-rays (I only informed them about them because I felt like I had to, not because I cared if they covered the cost or not) and they then excluded her hind right leg in entirety (hip down through hoof).

I can’t comment on the Canadian side of things as I’m on the US side of the border. But I have 7 horses and I opt not to insure them. It might be slightly different for my competition horses (who have much higher premiums) than youngsters, but to insure my whole group would run in the $5-10k range each year. And while one bad incident can certainly hit that $10k mark, it typically (furiously knocking on wood) doesn’t happen every year. So the amount of money I spend on a bad vet year is usually the amount it would have cost to pay for insurance. I wish insurance companies would do some sort of a “floating” insurance policy for people with bunches of horses, but that certainly wouldn’t stack the odds in their favor!

With that being said, I have 2 young horses currently in Germany out of my care and control. I opted to insure both of them for the remaining time that they’re there and for the transport to the states. Both are insured under mortality policies (and have some coverage for colic as well that was part of the insurance policy) with special additional coverage for transport. I believe it cost me somewhere in the $500-$600 per horse range for that coverage.

So again, it comes back to playing your odds. If you have a bunch of horses and set aside $500/horse each year, you’ll have a pretty decent “vet fund” without going the insurance route.

As for what insurance covers - it totally depends on the policy. I have purchased insurance policies in the last few years from Hallmark. Here are some of the coverages you can purchase (again, not Canadian-specific, but just for info):
http://www.hallmarkhorse.com/covhorse.asp.

And whether you need to keep an emergency fund handy or not - that also depends on your insurance company. In the cases that I’ve used insurance, I’ve paid the vet and then been reimbursed by the insurance company many weeks/months later. And insurance isn’t going to change many of your vet bills much as there is much that doesn’t go through insurance (vaccinations, routine care, etc.). So perhaps take a look at your vet bills for past years and see if you can determine how much money you spent on “incidents” (meaning not part of typical care and maintenance) and then compare that to the cost that a year’s worth of insurance policies on your youngsters would cost. That will probably give you a decent idea of whether it’s worth it or not?

[fordtraktor]

I am with PNWjumper, it is not cost effective for me to insure mine. I have 5. And I have paid some pretty hefty vet bills over the years… Still, cheaper than insuring the herd over decades when you crunch the numbers. I have an account I keep pretty well funded for emergencies and other horse expenses, like buying my year’s supply of hay, etc. it is separate from my DH’s account so while my horse $$ is no secret, I don’t wave the numbers around under his nose that often either. Most of our $$ goes into a joint account but my farm account is separate.

I have not had to make vet decisions based purely on $$. However I am somewhat practical…I doubt I would put the elderly retiree through colic surgery, etc. the competition age horses and youngsters, of course, no question if they were candidates. Not sure any of that would change if I insured them, honestly.

[Daventry]

Regardless of who you go with, make sure you know your policy inside and out! Will your horse be insured for “agreed value” or “actual cash value” (fair market value)? With agreed value, if your horse is insured for $10,000 and the horse dies, the insurance will pay out $10,000 as long as there is proof of value. With actual cash value, you may be paying premiums on $10,000 for 5 years, but if your horse dies, the insurance company will only pay out what your horse is worth at the time of death (fair market value). If the economy tanks, etc., and the fair market value is only $4,000, that is unfortunately all you will get.

Most horse owners are under the impression that if they insured their horse for $20,000 and they’ve paid their premiums every year that they will get $20,000 if they die. Unfortunately, no always true! Unfortunately, I find some insurance brokers don’t always explain the type of policy you are purchasing.

There honestly is nothing wrong with purchasing an actual cash value insurance policy. That’s what I have in place for two of my horses. That being said, I’ve been very careful to only insure them for what they are worth (haven’t inflated the value) and I have kept excellent records for each horse, including current videos, photos, show results, etc.

Regardless of the insurance company you choose, please, please, please make sure to keep good records on your insured horses - including pictures, video and show records…and remember to continue to update them! I’ve done several very tough equine appraisal cases in which the owner didn’t have a single photo or video of their insured horses that passed away, no show record, nothing…which makes it extremely tough to prove their value! And, if you feel like the insurance company is giving you the run around, and you truly believe your horse is worth more, get your own independent equine appraisal done and present it to the insurance company. I do a lot of these…and it does work!

I’ve written an article in regards to the ins and outs of equine insurance and explains things like Major Medical and “Loss of Use”: www.equineappraisers.com/howwelldoyouknowyourpolicy.html

[DarkBayUnicorn]

@Daventry;8457020

I’ve e done several very tough equine appraisal cases in which the owner didn’t have a single photo or video of their insured horses that passed away, no show record, nothing…which makes it extremely tough to prove their value! And, if you feel like the insurance company is giving you the run around, and you truly believe your horse is worth more, get your own independent equine appraisal done and present it to the insurance company. I do a lot of these…and it does work!

I’ve written an article in regards to the ins and outs of equine insurance and explains things like Major Medical and “Loss of Use”: www.equineappraisers.com/howwelldoyouknowyourpolicy.html

Be aware that major medical / surgical can be redeemed for FAR less than mortality, no matter the insured value on replacement/mortality. You have to ask for more coverage on major medical/surgical or it defaults to $10K.

[Cabaret_SK]

I didn’t have a youngster, but I had my gelding insured with HEP - Henry Equestrian. They are Ontario based - but insure across Canada. I have a couple of friends who have horses with them too, and they have also been very happy with the service.

They were excellent to work with. Quick to respond, explained everything clearly, and were always available for questions.

They always paid out in a reasonable amount of time for any claim I made (usually within a month for smaller injuries, and within 3 for a large medical + mortality claim).

They were pretty good regarding exclusions, too - he had a minor gas colic one year, and they still covered him for colic on renewal. He injured his hip, and it was excluded - but only for complications from the original injury. It would have been covered if he had injured the same hip again in a different way.

[Somekindawonderful]

Thanks all, very helpful info. Certainly a lot to sort through, and really understand before I commit. We have 5 horses, it’s the 2 youngsters I intend to sell that I would be looking at insuring but I am weighing the cost/benefit vs my current strategy. Comments from any breeders out there?

@ DarkBayUnicorn = “Be aware that major medical / surgical can be redeemed for FAR less than mortality” can you explain this? Do you just mean that I can choose to have a lower amount covered for MM vs the horse’s value, or that the company can choose to only cover you for a lower amount? Not sure what you mean by “redeemed”.

@ Cabaret SK = did you choose the “agreed value / guaranteed renewal” option? Can they still give exclusions at renewal, and this just means that you can still get some kind of coverage?

[DarkBayUnicorn]

[QUOTE=Somekindawonderful;8458020]
@ DarkBayUnicorn = “Be aware that major medical / surgical can be redeemed for FAR less than mortality” can you explain this? Do you just mean that I can choose to have a lower amount covered for MM vs the horse’s value, or that the company can choose to only cover you for a lower amount? Not sure what you mean by “redeemed”. [/QUOTE]

I haven’t had a chance to talk to my broker with this question due to the holidays, but a VERY nice A/O hunter in my barn just had to have colic surgery and it turns out his MM went to $10k only. Owners had to pay the balance.

Just glanced at my mare’s coverage and we have $10k MM, but her insured value for mortality is at $30k. Hence my assumption that if you want more than $10k MM, you have to ask for it and pay a higher premium.

I’ve only bred once my mare once (she has now returned to competition), and left my youngster without MM and valued only at what it would cost me to recreate him until this year’s renewal. At 2.5 years old, we added MM and increased his value for mortality to what my coach would price him at on the open market. He is, of course, priceless to me.

I am with HEP and have always had great experiences with them when I’ve had to make a claim.

[Daventry]

[QUOTE=DarkBayUnicorn;8457279]
Be aware that major medical / surgical can be redeemed for FAR less than mortality, no matter the insured value on replacement/mortality. You have to ask for more coverage on major medical/surgical or it defaults to $10K.

…I haven’t had a chance to talk to my broker with this question due to the holidays, but a VERY nice A/O hunter in my barn just had to have colic surgery and it turns out his MM went to $10k only. Owners had to pay the balance.

Just glanced at my mare’s coverage and we have $10k MM, but her insured value for mortality is at $30k. Hence my assumption that if you want more than $10k MM, you have to ask for it and pay a higher premium. [/QUOTE]

Unfortunately, what you are thinking isn’t how equine insurance or how major medical insurance works. There isn’t an insurance company on the planet who will, for example, give you mortality insurance on your $30,000 horse and also offer you the equivalent of $30,000 major medical on the same policy. Again, this isn’t how equine insurance works. Bear in mind that major medical is considered an “add on” or extension of your existing policy, and normally maxes out at $10,000 for Major Medical. So, even if you asked to “up” your Major Medical for your $30,000 horse, the insurance company likely doesn’t offer anything higher than $10,000 coverage.

As stated in the article I wrote: “Surgical or major medical equine insurance policies are normally one and the same. Jenny Lamberton, an insurance broker with Capri Insurance in Kelowna, British Columbia states, “major medical/surgical covers the expense of medical treatment, surgery, after-care and diagnostic testing due to an injury, illness or disease. $5,000 or $10,000 maximum limits are available through Capri. Major Medical is subject to a $500 deductible per occurrence and coverage for follow-up care is limited to 120 days from the date of first treatment”. It is important to realize that surgical or major medical coverage is normally purchased in conjunction with an equine mortality insurance policy. Rates for surgical coverage can range anywhere from $200-400, depending on the type and amount of coverage needed. This amount is in addition to the mortality premium for your horse.”

The majority of equine insurance companies out there only offer $5,000, $10,000 or $15,000 surgical coverage…regardless of how high the value is on your horse. It often costs $250 EXTRA per year to add $5,000 surgical coverage on to your policy and usually $350-400 EXTRA per year to add on $10,000 surgical coverage. Again, this is on top of the yearly premium you pay for mortality insurance and the amounts offered and the fees for it vary from insurance company to insurance company.

So, for example, you would not be able to purchase a standard policy for $250,000 and then get $250,000 surgical coverage. In order to add on Major Medical to a policy, a policy holder would need to request this from their insurance broker, so they are already going to be well aware of what the upper surgical limit is. Bear in mind that, although a policy holder may be “redeeming” or making a claim for Major Medical, it isn’t cheap to do so! Again, you are paying the extra yearly fee to have Major Medical added to the policy in the first place, there is normally a standard $500 deductible that must be paid before the insurance company will cover a limited amount of the medical bills…and depending on the reason for a medical claim, that limb, colic, etc. could end up being excluded from the policy for the next two upcoming years…or permanently. Again, all dependent on the type of medical claim and the individual insurance company.

[Cabaret_SK]

[QUOTE=Somekindawonderful;8458020]

@ Cabaret SK = did you choose the “agreed value / guaranteed renewal” option? Can they still give exclusions at renewal, and this just means that you can still get some kind of coverage?[/QUOTE]

I don’t remember if I had guaranteed renewal, sorry. For me, they told me about the exclusion for the hip when it happened/when I made the claim, but it appeared in the policy upon renewal (I think!).