insurance advice please!

[htobago]

Prompted by a thread on NL...

When I bought Tobago last year I automatically insured him for the full purchase price, thinking this was the right thing to do.

But - it's costing me a fortune (£2650 per year!

) and after shelling out this ludicrous premium again this year, it dawned on me that perhaps this was not such a great idea...

I'm thinking maybe I should just insure him for the basic public liability and vets' fees, not for death, loss of use, etc., etc.

Or that I should just not insure him for his full value - especially as he was recently professionally valued at considerably more than I paid for him, and I haven't upped the insurance, so he is now under-insured anyway.

OK, I would lose out if he dies, but I would be so miserable if that happened anyway that no amount of money would make it any better.

He's only 3, and is the most over-protected, molly-coddled, cotton-wool-wrapped horse on the planet, and I get the vet out if there is ever the slightest sign of anything being amiss, so he's unlikely to die anytime soon - unless it were a total freak accident or something.

I'd really appreciate some advice! Am I being a complete numpty to pay these ridiculous insurance premiums?

 

[eventrider23]

Well...
When I was working for one of the Irish event riders the owner of their top (and subsequent Olympic) horse turned around and said that he wasn't having him re-insured that year. Having not long had a horse break it's back in competition we all protested, saying what if something went wrong, etc. etc. but he like you have, pointed out that with the HUGE premiums he was shelling out every year (and had already done so for many years) that if instead he put that money one side every year, he would eventually have saved more than enough money to pay for another horse of his caliber.
He took into accound the fact that he was taking a risk with regards of if he injured himself, etc. but decided that that was a risk worth taking. It turned out to be a good plan asthe horse is now 18 and competed at the Olympics, Europpeans and several 4 stars since, without needing a single insurance claim. The owner did give him to the rider a year or so after he stopped the insurance but they never bothered re-insuring him and so over the past 5 years I would say that have certainly saved a bundle.

 

[Anastasia]

Premiums for insurance are very large if you insure for the full value.

With Geneve we had him insured for a sum of money that would purchase us a very nice young colt again (granted we have to go through all the grading processes again etc). Yes I would have LOVED to have him insured for his full value, but this would have resulted in an insurance premium in excess of £6.5k a year!!

So we had to think of it in business terms. If we were happy with paying out £6.5k a year etc then sure we would have done that, but in reality there is no way we could have afforded to pay out that sum of money.

We had him insured for vet fees, death and public liability, but not on loss of use.

Yes we lost him at a very young age, and no sum of money would ever have replaced him. Thankfully we have frozen semen, so we use this as our insurance policy for the stallions instead.

Big studs like VDL, Nijhof etc could never pay insurance premiums on all their horses. We spoke to Jak at VDL once about this and he said their insurance is in their numbers. If a stallion dies then they bring up another young one to replace them. For the likes of Indoctro who takes in millions of pounds, you could never put a price on his head for insurance purposes!! The same I am sure would be the same for the likes of Sandro Hit....although maybe PS does insure him....who knows....

You just have to make a business choice for yourself and way up the pros and cons of the money.....against the probability of 1. losing your stallion and 2. if you did lose him and wanted to replace him again, what would you have to pay?

Only you can answer that one....

p.s. how you feeling?? xx

 

[htobago]

Thanks Tinsel and Eventrider - jolly useful advice!

Well, having read your responses and given this some thought, it does seem daft to continue paying these premiums, especially as I am still not even insuring him for anywhere near his full value. I didn't even bother to find out what the premiums would be when he was re-valued recently, as I knew it would be some stupid astronomical amount. And if his first foals are as good as we expect, his value will go up again, and I'll never be able to afford the premiums.

I really like the idea of putting the money aside instead, and saving up for another horse - not to 'replace' Tobago (nothing ever could) but to have as well as Tobago. My husband will only let me buy another horse if it's a colt (the poor deluded fool has got it into his head that I have this great eye for potentially successful stallions, and that any colt I buy will soon earn its keep in stud fees

- whereas if I bought a mare I would breed and never sell the foals...well - he's right about the mare-and-foals bit LOL)!

Very good point about my 'insurance' being all the frozen semen, especially as the boy is about to go back to Twemlows to be collected for US/Worldwide frozen semen.

So - given that I've decided not to continue paying the huge premiums, what would be best: To drop the death/loss-of-use bits and just insure him for public liability and vets fees? Or keep the death/loss-of-use insurance but just insure him for a much lower value?

 

[htobago]

Sorry - forgot to answer your last question Tinsel. I am quite a bit better, thanks - the worst of this relapse appears to be over. Feeling a bit depressed cos I've lost all the weight it took me ages to put back on after the last bad relapse. But I'm still determined to be well enough to ride Tobago when he's backed, which should be quite soon!

His trip to Twemlows has now been postponed to mid-January, so I've asked Cliveden to get on with backing him in the meantime.

So...there is even a small chance that I might, perhaps, get a little ride on him as a late Christmas present!

 

[the watcher]

Really good news that you are on the mend, and very exciting that Tobago will be ridden soon.
As far as insurance - vet fees and liability are probably the most sensible and economical

 

[Navalgem]

Vets fees and liability and I dont think the value he's insured for affects what they pay for those two should you need to make a claim, so insure him for lots less, and save up the extra, thats what I 'try' to do with mine, except the damn money keeps being spent. TBH, with my 2yo, I'm glad he's insured as it's paid for the op he's just had which I'd never have had the capital for while I'm studying. and I've only paid out 200 over 2 years, he's insured for 2.5k, and for everything but he's only insured for being on the yard. will be more if I insure him for shows and the like etc.

 

[Anastasia]

[ QUOTE ]
So - given that I've decided not to continue paying the huge premiums, what would be best: To drop the death/loss-of-use bits and just insure him for public liability and vets fees? Or keep the death/loss-of-use insurance but just insure him for a much lower value?

[/ QUOTE ]

I would tend to insure for death, vets fees and public liability. Well that is what I tend to do anyway. Vet fees up to £5k per incident (as our lad is big).

Well fingers crossed that you get your christmas wish to ride him, and am glad to hear you are on the mend again. Did post a while ago to see how you were....you do worry about people who have not posted for a while......

x

 

[Tia]

I have never been interested in mortality, purely vet fees, therefore I always undervalued my horses by about three quarters back in the UK. Of course over here mortality came as standard on my insurance policy, hence I overpriced them!

 

[eventrider23]

Insurance up to £5k is pretty cheap and so maybe insure for vets fees and def liability (esp with a stallion) and maybe even death/loss of use at that value. My boy is insured for that and the premiums are only about £300ish a year and then if the unthinkable did happen I would still get £5k back plus in your case any other money that has been put aside....that way you could buy a halfway decent youngster.

 

[pocomoto]

Personally I wouldn't bother with the loss of use from experience it's not worth the paper it's written on, there is always a way to reduce it! As a breeder I figure I can breed another so I insure for the minimum amount death so I can get the average vets fees cover and public liability (remember even if someone lets your horse out you might still be liable for damage!).

I don't bother with all the frilly bits. At the end of the day you will never replace that horse but you would want to do the best should he get injured. You would have to ask would you want to go out and buy another horse or would you be able to breed one or have enough money to buy one anyway, and do the premiums for a higher amount cancel any advantage out?

If you are good with money (rare with horses I know) then you could put some or all of the premiums in an account, but would you have enough if he injured himself tomorrow?

Shop around a bit and watch the insurance I know the NFU raise the premium for stallions covering over a certain number of mares!!!

 

[htobago]

Thanks again everyone!

I would always make sure he was properly insured for vets' fees and public liability - that goes without saying as it would be utterly foolish not to!

But it does sound as though insuring him for a much lower amount on mortality and putting the extra money into a 'new horse fund' would be more sensible. I think I'll go ahead with this plan when the insurance comes up for renewal next year.

Pocomoto do you know at what number of mares the NFU starts to raise premiums for stallions? And does this apply to stallions breeding only by AI?

Thanks again - you've all been really helpful, as always!