How Much Is Horse Insurance in 2022? What You Need to Know!
In general, insurance policies are designed to protect your investment and avoid the costs associated with an accident, injury, or illness. It’s likely that you already have farm insurance, vehicle insurance, and health insurance. You may even have liability insurance. But what about horse insurance?
Horse insurance can provide peace of mind in the event of an accident, career-ending injury, or life-threatening illness. The intended purpose of these policies is to ease the financial burden of these situations, so you can deal with them accordingly. If you’re wondering how much horse insurance costs and the types of coverage available, read on.
What Is Horse Insurance?
The two types of coverage most often purchased by horse owners are major medical and mortality policies. In general terms, these correspond roughly to the equivalent of health insurance and life insurance policies for humans.
Mortality insurance reimburses the owner for the value of the horse if the horse dies. Medical and surgical insurance policies offer coverage for expenses associated with the treatment of injuries or illnesses. While mortality coverage can usually be purchased as a standalone policy, medical coverage is usually only available in conjunction with mortality insurance.
How Much Does Horse Insurance Cost?
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The annual premiums for horse insurance vary significantly depending on your horse, your location, and the coverage that you choose.
For mortality coverage, you can expect to pay between 2.5% and 4% of the value of your horse. For example, if your horse is valued at $7,000, your annual insurance premiums will range between $220 and $280. So, the lower the declared value of the horse, the lower the premiums; however, most policies will charge a minimum $150 premium.
You can plan on spending an average of $150 to $250 per year on top of your mortality premium for medical and surgical insurance. Then, you will pay a deductible for each claim and a flat fee based on your coverage limit.
Flat fees for medical/surgical coverage are typically between $5,000 and $10,000, and deductibles range between $150 and $250. Costs for medical and surgical insurance don’t vary between horses like mortality policies do.
Factors That Affect the Cost of Horse Insurance
The type of coverage that you purchase
Coverage limits
The number of horses that you are insuring
Your horse’s risk level
Your farm location
Only an independent insurance agent can give you an exact quote for horse insurance in your location.
Cost of Horse Insurance by Horse Type
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The type of horse that you have significantly impacts the cost of insurance. This chart will give you a better idea of what you are likely to pay for coverage.
Horse
Price Range
Coverage You Need
Coverage Cost
Recreational/General Riding
Up to $1,500
Mortality, theft, major medical
$400–$500
Youth Show Horse
$900–$4,000
Mortality, theft, major medical
$1,100–$1,250
High-Level Performance
$10,000–$40,000
Mortality, theft, major medical, loss of use
$1,100–$1,250
Breeding Stallion
$10,000–$40,000
Mortality, theft, major medical, accident, sickness, disease
$1,225–$12,000
Senior
No value
Coverage available depends on the age
Costs increase significantly after the age of 14
Do I Need Horse Insurance?
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In most cases, the answer is no, you don’t. Horse insurance is expensive, and if you don’t own high-level performance horses, it might not be worth the added expense. The reality is that unless you have a performance horse worth tens of thousands of dollars, the cost of insurance may outweigh the benefits.
What most horse owners want is the emergency medical and surgical coverage. When you have a horse that is colicking, you don’t want to be faced with the choice between paying thousands of dollars for colic surgery and euthanizing your horse. Unfortunately, this situation is common, and many owners are faced with the unpleasant decision of euthanasia because they can’t afford to pay for surgery.
It is possible to save money on horse insurance by purchasing mortality insurance for less than the full value of your horse. Most owners can accept the financial loss from a horse’s death. But many would spend their last dime to give them life-saving care. This is the number one reason for purchasing horse insurance.
Things to Look For in Your Policy
There are a few things to take note of when shopping for a horse insurance policy, particularly when buying mortality insurance. How much money you will receive from your mortality policy is based on your horse’s value. However, this amount is calculated using two different methods:
Actual cash value or fair market value: The insurance company retains the right to evaluate your horse’s value at the time of loss. This valuing method is risky, as it’s based on your horse’s performance. Suppose that you are insuring a barrel-racing horse with an approximate market value of $12,000, meaning if you sold him, that is a reasonable price that you could obtain for the sale (this will vary significantly based on your location, of course; this is to demonstrate how insurance companies value horses). Now let’s say that your horse had a bad season after your insurance policy took effect. According to the insurance company, your $12,000 barrel horse is now only worth $5,000 because he doesn’t perform to expectation.
Agreed-upon value: With this type of reimbursement, your insurance pays you the agreed-upon value of the horse at the time that the policy is written, as long as the horse’s value has been substantiated. Most insurance policies that have this type of valuing in place require that you prove the value of the horse at the time that you purchase the policy. This is a less-risky means of reimbursement on mortality policies. Let’s take the $12,000 barrel horse from the previous example. If you can prove that you could sell your horse for this price at the time that you purchase your insurance policy, that is the value that you will be paid if your horse dies. There is still a burden of proof, but there’s far less chance that the insurance company will decide your horse’s value has changed.
Here is another horse insurance policy feature to clarify in your mortality policy:
Euthanasia: In the event of a catastrophic injury or illness, like a leg fracture or severe colic, there are strict rules in insurance policies about reasons that your horse can undergo humane euthanasia. Most will follow the American Association of Equine Practitioners guidelines, but be aware that justification for euthanasia is based on medical criteria, not economic criteria.
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Other Considerations (and Loopholes) in Horse Insurance
Specified Use: Disclose to your insurance company all the activities that you use your horse for. If you state that you use your horse for barrel racing only and your horse breaks a leg while jumping, you may not have insurance coverage.
Pre-approval proof of health: Most companies require a full veterinary exam and a declaration of health form before approving insurance coverage.
Extra expenses: In most mortality cases, insurance companies require a copy of a death certificate and a postmortem exam. The expense of these documents, exams, and removal of the body is your responsibility.
Specific exclusions: Be aware of what your insurance policy will not cover, as the fine print may surprise you.
Renewal: Some companies require you to repeat the application policy and proof of health every year, while others renew with exclusions. Here is an example of what “with exclusions” means. Once you make a claim for colic surgery, the company lists colic as a pre-existing condition, and you won’t be covered for another colic case unless you can prove that it is related to the first incident.
Coverage area: In the case of competition horses, most policies cover travel in North America only and will extend coverage throughout the continental U.S. and Canada. If you take your horse outside of North America, you will need different insurance coverage.
Payment options and discounts: Many companies offer payment plans. Some offer multi-horse discounts.
Conclusion
Horse insurance can cost anywhere from $400 to $12,000, depending on the type of coverage it has, the value of your horse, and where you live. Companies can be tricky about what they cover and how they value your horse, so it’s crucial to read the fine print and ask questions before purchasing a policy.
