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Equine Insurance insights: Horses like CARS

Submitted by: Danielle Aamodt
Phone: 267-972-1491
Email Address: DanielleAamodt(at)gmail
Date Added: 8/28/2016

Everyone has a different perception of Insurance companies, and it's usually linked to a personal experience. Whether you're grumpy about making premium payments or relieved when you had a major claim paid, you have likely decided that insurance companies are either the best thing in the world . . . or the worst.

As an independent insurance agent, I don't work directly for the insurance companies; I work for my clients. But of course I am privy to the interior decisions of companies and I understand why they make policy changes. So, while it may sound like I am defending insurance companies here . . . I am really just trying to shed light on the business in general.

We love our horses. They are our fur babies (I know mine is). But when it comes to insurance, we need to think of them like we think of our CARS.

Equine insurance products may sound like human insurance: "Mortality" sounds like Life insurance and "Major Medical" sounds an awful-lot like Health insurance. But, they don't work the same way.
When I became an Equine Insurance Agent, I had to get a Property & Casualty insurance license, not Health or Life. (granted, it doesn't teach you a THING about how horse insurance works...) The point being: horse insurance is technically Property insurance and we tend to forget that.

When you buy Auto insurance, you expect to use it for accidents. You don't expect it to cover your radiator when it busts & needs to be replaced. If you bought a car with a dead engine, you don't expect your insurance to drop a new engine in the car. And yet . . . we expect these things of our horse insurance. I had a client get upset when a policy excluded a pre-existing condition that she knew about on the pre-purchase exam. Again, this wouldn't have been an argument with a car.

Replacing parts as they break on your car is just a part of life with a vehicle. If we compared that to when horses start to break down, then we would actually find that Equine insurance is VERY generous to pay a claim on every new issue at least once. But joint injections really need to be thought of as your oil changes. They aren't included anymore.

The insurance companies have to find ways to protect themselves against their losses. It's not because they're big, bad insurance companies trying to make a profit off of everyone. It's just the nature of insurance business. Premiums collected must be able to offset the claims paid, or a company will go under. (And they have.) Equine insurance companies struggle, compared to other insurance industries.

Now they are finding more creative ways to protect against the many losses they pay out on. For example, they're adding deductibles & adding copays to their policies. Some have had to raise prices & reduce limits. Eventually, policies are going to limit Lameness benefits, because that has been the biggest loss for ALL of the companies across the board. (Yes, even more than surgery)

Advances in Veterinary medicine are wonderful, but not cheap! A simple lameness can rack up several thousand dollars in Vet bills . . . and lamenesses are a LOT more common than surgeries are. Insurance companies are bleeding out on losses due to lameness.
Unfortunately what we'll see is an increase in pricing for Major Medical, along with a reduction in what it covers.

Rather than getting upset about it, people need to realize how GREAT horse insurance really is. We have an insurance product you can buy to protect yourself from massive Veterinary bills in the event of an accident or major health issue. The insurance is there to pay for a surgery, a scary disease, a visit to the clinic, or major accidents. That's a huge relief to those of us who can't save $20,000 for such things.

Horses are a VERY risky investment. We all know this. And when you include the emotional attachment, there isn't much choice when you're deciding between saving their life or going into major debt for the next 5 years. We do everything we can for them, regardless.
That's what the insurance is there to help with.

So try not to be upset when an insurance policy doesn't want to cover the little stuff too; or we'll run them out of business.

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