Valuation of horse out on loan

Spottyappy

Spottyappy

Well-Known Member
Joined
5 September 2008
Messages
3,611
Location
Home counties
Visit site
We have a horse out on loan, and would like opinions on how to change the value on the contract, and insurance.
We have a BHS loan agreement, but as it is an indefinite loan, have not added a review date.
The people took the horse on with known problems, one was a health issue and the other a loading one. Said horse was also fairly unfit at the time. We knew what the horse was capable of, however,and valued it as £1500,allowing for it to be fittened and the health issue would be improved once horse fit.
We now feel the people have actually put a considerable amount of time, effort and money into the horse, and it has improved considerably,and therefore its value is likely to have increased too.
We do not want the horse back, although should their situation change, we would have it back.
The loaner insures it, but how do we stand if we feel the horse is now worth more, when we have not had a review date on the contract.
As we would want it insured for more, the loaner would need to pay an additional fee.
Is it fair to ask the loaner to pay that, and change the contract valuation, or do we just hope that nothing happens to the horse so it is never an issue?
Any thoughts or experiences appreciated.
 
You will have to have a conversation with the loaner as to whether they would be willing to pay the extra. From my experience though, it is reasons like this that I have always known the owner to insure the horse, not the loaner as you would be the one benefiting from a payout not them....

It is not that easy to increase a valuation on a horse by the way. You usually have to get a couple of valuations from instructors/judges etc. They do not just take the owners word for it. The horse will have had to actually do something (ie a competition record) to prove it is worth more.
 
I would advise you to insure the horse even if they pay you the amount to cover it. If they give you the horse back with a problem/injury/illness you won't be insured for it. That aside (u may be doing that already, it just looks like you're not) I think it's unfair to have a loaner pay for the section of the insurance that is for the horses value as you would get that payout. How about you increase the insurance but you pay the difference for the increased amount?
 
amymay said:
Why do you want to increase it's value?
Click to expand...

I suppose if something goes wrong, you can then replace like for like?

I think you need to have a discussion with your loaners about it, and whether they'd be happy to pay. In the end, it will just increase what you'll get for loss of use/ death, and so should they be paying that as you'll get the final pay out?
 
The loaner pays the insurance, mostly as she wanted to. It is in our loan agreement, and it works well for us both that she pays, I am noted on the policy as owner so in the event of a claim for death, the money does come to me, but if its a vet claim it would be paid to her. This is also the same with the horse we have on loan.
The reason for increasing the value is literally to be able to have the full true value In The event of death.
Should the loaner wish to ever buy the horse, too, we would want nearer the current value too, which I estimate to be around £2300,rather than £1500 as originally written into the agreement.
The horse has been successfully competed now, at several disciplines, where as we had just done riding club, showing and local jumping. They have done x country, working hunter and basically done a much wider variety of things than we did, and more frequently, thus building up the horse's experience more. The value is likely to be held down by the health issue, so I am not unrealistic in my valuation, I believe.
 
amymay said:
Unlikely Lolo.
Click to expand...

I know, but I thought that was the ultimate goal in insuring your horse for what it's actually worth...

(speaking as the person who hasn't had an insured horse for over 8 years now... Reg isn't and my boy was too old.)
 
I'd be pretty upset if I loaned and then asked to buy and then had to pay £2300 when the horse was only worth £1500 before it came to me.

Also, I don't think it's fair to make the loaner pay more, as you'd be the one benefiting from it. If you want to pay the extra, then fair enough.
 
I agree that's the thing about loaning but I would be upset especially if I was the one who had increased the value. And if I (if I was the loaner) wanted to buy the horse from you I would also be paying more for the hard work I'd put in which created the increase?
Outside of all that I really do urge you to take on the insurance yourself. I'm not saying you should pay it, I'm saying you take it on and your loaner pay you (with or without the increase) as if things go wrong and your horse is returned to you then you are not insured for vets fees for anything your horse comes back with. Even the best loan agreements can go wrong when you least expect them.
 
I don't think it's fair to expect loaner to pay a higher price if they do buy the horse - they have brought on and increased it's value according to you?
 
kateo said:
I don't think it's fair to expect loaner to pay a higher price if they do buy the horse - they have brought on and increased it's value according to you?
Click to expand...

However, nothing is in the contract about purchase,so we could, in theory, terminate contract take horse back, and sell horse anyway! At whatever price we want.
We wouldn't,however,as are not like that.
But,that is the perils of loaning,and should I do so again,feel a review needs to be put in to allow various changes such as horses value or possibility of purchase and how price to be agreed.
I am happy with loaner paying insurance as I see copy of renewal. It works fine with me noted as owner. It must happen alot as the company,Sheerwater, told us to do that when we first discussed it with them.
 
I'm glad I'm not your loaner! :eek:

As the owner, you should be paying the insurance. If you were, you would be able to just change whatever you wanted and pay extra.
As you're not, no it's not really fair to expect the loaner to, they can quite rightly refuse.

Your loaner doesn't seem to be getting a great deal here - the only thanks they seem to be getting for improving your horse is a bill!
 
Spottyappy said:
However, nothing is in the contract about purchase,so we could, in theory, terminate contract take horse back, and sell horse anyway! At whatever price we want.
We wouldn't,however,as are not like that.
But,that is the perils of loaning,and should I do so again,feel a review needs to be put in to allow various changes such as horses value or possibility of purchase and how price to be agreed.
I am happy with loaner paying insurance as I see copy of renewal. It works fine with me noted as owner. It must happen alot as the company,Sheerwater, told us to do that when we first discussed it with them.
Click to expand...

Good grief. I hope I never end up loaning from you. "Not like that" but quite happy to try and milk the loaner for money for work that they have done improving your horse for you.
Would it not be preferable to you to sell to someone who you know already takes good care of the horse (as evidenced by the perceived increase in value of the horse)? Or are you running a business???
 
Wow, poor loaner.

So if she decides to buy your horse she is now being charged an extra £800 for putting all the hard work in, taking it to comps etc for you.

That sucks :(
 
I think this type of situation is what makes loaning a young or inexperienced horse or pony much more difficult.

I have a pony for loan, a forever loan, who is backed and very well behaved. I have almost given up looking; people are so nervous about having the loan taken away once the horse is more experienced, useful and valuable; then sold.

Once I got a good loan home, I had intended to gift her, but people don't keep their word; so how could I expect anyone to trust that I would not take the pony back when she was trained.

Although any increase in value is I suppose your cash, that increase is as a direct result of the good work your loner did; and if the horse was sold, I personally would feel that the extra cash should rightly be paid to the loaner. After all, he/she added that value. In fact, if the horse had just stayed with you, it may well have been worth much less than £1,500 by now.

Imagine what the cost of the work the loaner has done would have been if you sent the horse away to a trainer to progress.

I would be just amazingly happy if I had a loaner who would bring my pony on and give her a better future; causing them to have to pay more for my eventual benefit would be something I would not be able to do.

If you have a good loaner, look after them.
 
I'm a another person who says poor loaner.

She's put the work in and made that horse that value.

You loaned a horse out worth the price you put on the agreement at the time.

The horse may be worth more but that's not to your credit. Leave alone as if I was the loaner horse would be immediately returned and we would not be talking.
Does loanee want to buy!?
 
When I loaned my horse his owner paid for insurance (I paid for everything else).
When I took him on he had a value in the contract of £2.5k (slightly higher than what he was really worth imo) and we had agreed that if I bought him that is how much he would be. He was also insured for that amount.
I put a lot of time, effort and money into the horse as I really liked him. *I* increased his value further over the next 9 months untill he was valued at 5k by instructors and local people of note. I knew I wanted to buy him by this point and I did buy him off his owner for the original 2.5k as it was all *my* work that had increased his value.
When I bought him I obviously took over the insurance but I haven't increased it as the rise in premium isn't worth it IMO especially as vet cover stays the same.
I would have been very very upset and cross if his owner had turned around and said Now he's a 5k horse I want you to pay higher insurance and I want 5k for him. I'd have been livid! It was me in the depths of winter working him in all weathers, paying to take him to comps getting back men and saddlers and goodness knows what else for him.
So I would not be surprised if your loaner gets a little bit miffed when you approach her about this. I would tread carefully as it seems you have been lucky to find someone decent for a horse you admit had quirks. Be fair.
My arrangement with the owner of my horse worked out perfectly. I took great care of her horse and he now has a forever home and her fairness enabled me to have a horse that I adore.
 
Realistically, OP, for the kind of money you are talking about it's probably not worth increasing the value on your horse's insurance. All you get is a higher premium (which your loaner may or may not be willing to pay) and - if the horse is insured for loss of use - the *possibility* of a higher pay out should you need to claim. Given how difficult it is to claim LOU or to get a full pay out anyway, it's probably not worth the higher cost. The vet's fees/legal fees/third party coverage are unlikely to change. Perhaps you should discuss whether it's feasible to put the insurance in your name, with you paying the set fee, and add the loaner to instead. I know some companies don't make that possible...
 
Agree with the others, that's really not fair!

I had, until 2 weeks ago, 2 horses out on loan with yearly contract updates. The only way I would 'edit' a contract would be for changes of address and to renew it for a new year. I wouldn't dream of increasing the price, as they took the horses on at that price, so that's what I would expect them to pay if they were to buy.

I have also loaned ponies before, I had a youngster once who was chucked in a field, after being broken in, for 18 months, and I retaught him everything, I would be FUMING if the owner increased his value on the contract. As it was, we were schooling him on for them as we couldn't afford to buy, so knew what we were getting ourselves into.

If there is nothing in your contract stating about price increase when horse becomes worth more, if I were your loaner I would be telling you where to go!

Bexcy-bee x
 
I'd be annoyed if the owners of my loan boy told me they wanted me to pay more insurance for them to get a larger payout SHOULD anything happen. I pay for his insurance, insured at £2000, which is near £30 a month.
I think it'd be unfair to ask them to fork out more money on a horse that isn't theirs.

OP, if you want the horse to be insured for more, maybe you could pay the difference? If it were me i'd be open to that idea, however i would not pay more for the insurance for no benefit to me or the horse whatsoever.
 
That seems pretty ruthless OP! Wanting them to pay extra for insurance because THEY have increased the price through their hard work. If this loan home is doing a great job suggest you make up the difference yourself - otherwise they may tell you to get stuffed.
 
WOW ide hate to loan from you!

Youve admited they take good care of the horse so much so they have, in your opinion increased the value. So if your planning on ever taking the horse back, why is this even an issue?! Pretty morbid fixation on if the horse dies you will get more money, you dont even want the horse!
 
First of all read all the clauses about getting paid out for death of the animal. You might have a bit of a shock.
 
Kaylum said:
First of all read all the clauses about getting paid out for death of the animal. You might have a bit of a shock.
Click to expand...

This absolutely - the chances of you getting your £1500 if/ when he dies are so slim anyway why disrupt a good loaner to get them to pay more so you're even more cross with the insurance company when he does die and they don't pay out becuse :-
- he was pts and didn't meet BEVA guidlines
- he was PTS without their consent
- he was over x years old so not covered anyway
- he was treated for mud fever 3 years ago which wasn't disclosed to them as vet bill was £50 so no claim made but that breaches their Ts & C's so insurance is void anyway
- he was doing an activiity (XC etc.) that he wasn't covered for
- as he was X years old they value him at £500 and you have to get signed statements from instructors to prove he's worth any more than that - now impossible as he's dead !!!
- blah blah blah blah
 
I think it would be fair to take over the insurance payments if you wanted to up his value, rather than ask the loaner to. They have put all the work in to get him to that value therefore I think it should be their choice if they want to pay the extra or not, baring in mind they will be paying for it, and if anything happened you would receive the benefits rather than them, which would only be fair if you were paying, if that makes sense!? :p

What is the purpose for upping his value on his insurance?

Mine is only insured for the essentials and still at his purchase price, which is a considerable lower amount than if I were to sell him.....
 
I have to say I'd be mortified if I was your loaner that you would almost stitch them up because you believe the horses value is higher due yo their time and money. I'm like that loaner - I have hairy on loan to buy next year, but have been investing my time and money into him. If my friend suddenly upped the price I'd be really p*ssed off

This happened at my previous yard. The YO was left a overweight and barely rideable cob in lieu if stable fees. A girl took her on loan and did amazing things with her, she won loads. YO then wanted her to buy mare for what she was currently worth. Girl walked away. Mare didn't have another rider for a while and ended up selling for the price the original girl negotiated :/

I think just leave be - death insurance isn't really worth the money
 
You must log in or register to reply here.
Top