Value Justification for your Equine

Good afternoon bloggers!

Today we want to share an article with you from our Australian insurance agent friends, Gowgates Insurance Co., about justifying a fair value for your horse in regards to your insurance policy.  Many times when we write a new policy for a client, they are unsure how to get a proper value for their horse for the policy. This brief article will help explain how that process is derived, and what you can expect. 

As always, if you have any questions please feel free to reach out to us! We are here to help with all of your equine insurance needs!

Have you ever been asked to provide a Justification of Value for your horse?

Have you ever thought you haven’t got a clue how to value your beloved horse as, of course, they’re priceless to you?!

From an Insurance point of view you need to bear in mind that when you insure your horse the majority of Equine Mortality Programmes are arranged on a Fair Market Value Market Value Market Value basis.

FAIR MARKET VALUE means the price at which you could FAIR MARKET VALUE sell the horse to a willing buyer who has reasonable knowledge and relevant facts of that horse.

The Insurance provides cover for the Insured Value Insured Value Insured Value OR Fair Market Value at Fair Market Value atthe Time Of Loss Time Of Loss Time Of Loss, whichever is the lesser.

Many people are under the misconception that they have an Agreed Value policy; if they insure their horse for $50,000 then, without question, if the horse dies they will be able to claim $50,000.

Yes, Insurers will pay a claim up to the INSURED VALUE, however if the horse’s FAIR MARKET VALUE is less than the INSURED VALUE at the time of loss then Insurers will only pay the amount it is actually worth at that time.

In addition, you cannot claim more than the INSURED VALUE either, so if the horse is actually worth more it is important to bear in mind that you should increase its INSURED VALUE accordingly.

In summary:-
• The INSURED VALUE is the maximum amount claimable under an Insurance Policy. • If your horse’s FAIR MARKET VALUE is less than the INSURED VALUE at the time of loss, you will only be able to claim the FAIR MARKET VALUE.

• If your horse’s FAIR MARKET VALUE is more than the INSURED VALUE at the time of loss, you will only be able to claim the INSURED VALUE. Values can always be increased or decreased, with your premium being adjusted accordingly, so that should the worst happen
and your horse dies the claim will be as straightforward as possible. Losing a horse is both stressful and emotional and you want your claim to be paid without question. Adjusting the values throughout the policy, when necessary, ensure that you will always be able to claim the CORRECT amount, being the true value of your horse.

METHODS OF JUSTIFYING YOUR HORSE’S VALUE METHODS OF JUSTIFYING YOUR HORSE’S VALUE
The easiest way to determine value is when you have just bought a horse. This is termed PURCHASE PRICE. This is the most common form of value indication.
If you have bred the horse yourself it is more difficult to quantify but generally you can look to insure your youngster at around twice the amount paid for the sire’s stud fee. As the horse gets older and develops through training, you can alter its value. If you have a Breeding Stallion you can apply the following formulae:
 (SF X M) X 3 for established Stallions
 (SF X M) X 2 for young Stallions in their first or second season
 SF = Stud Fee / M = Average number of mares covered per Season
The most important indicator would be, that if you were to sell your horse tomorrow, what would somebody pay for that horse?

WHEN TO INCREASE VALUE? WHEN TO INCREASE VALUE?

You should look to increase your horse’s insured value in a number of circumstances:
• Your horse has been competing consistently well and you have a Competition Record as evidence.
• You have had an offer from a third party to purchase your horse over and above what it is currently
insured for, and you can provide evidence of this offer.
• You first insured this as a young horse in training and now it is currently competing / training at a
higher level.
• You have had an independent valuation carried out and the resulting value is higher than it is
currently insured for.
• You provide insurers with a Statement from your Trainer or another experienced Professional who
confirms that in their professional opinion the horse’s value is now higher, and the reason for the
increase in value.
N.B. Increasing the Insured Value does not guarantee that amount will be paid in the event of a claim,
however, it does increase the Maximum amount you for which you can claim.

WHEN TO DECREASE VALUE? WHEN TO DECREASE VALUE?
You should bear in mind that if your horse’s value is lower at the time of loss than the value it has been insured for, Insurers only have to reimburse the current FAIR MARKET VALUE at time of loss, not the full amount you have been paying the premium on. The responsibility to advise us of any change in value lies solely with the you as the policy holder.
As much as values need to be increased as a result of the above mentioned, it should also be decreased in some circumstances:
• Your horse is currently not in work due to injury or your own personal circumstances – a prolonged
gap in your Performance Record often raises questions when justifying a horse’s value.
• Your horse’s performance has been diminishing in recent weeks.
• Your horse has sustained an injury and whilst back in full work is unable to compete at the same
level or to the same degree as previously.
• You invited an expression of interest for your horse but failed to obtain an offer you wanted, and
that all the offers you did receive were lower than what your currently have the horse insured for.
• Your horse is getting older, generally beyond the age of 16, however this is judged on a case by case basis.


Disclaimer: The information in the above article is intended as a guide only and should not be relied upon without the seeking independent professional advice.

Help Protect Your Home: Clear Your Roof of Snow

Here in Maryland, these last few days have been brutally cold and it doesn't look like it's getting any warmer any time soon. With a significant amount of snowfall predicted later today, in many of the states our clients are in, we thought it would be good to share this article!

Help Protect Your Home: Clear Your Roof of Snow 

Written January 5, 2012

By Staff Writer State Farm

Plenty of homeowners in the United States live with the harsh realities of winter. According to the National Oceanic and Atmospheric Administration, residents in Rochester, New York, receive about 8 feet of snow each winter. Homeowners in cities such as Cleveland, Minneapolis and Denver typically can expect to move more than 4 feet of snow. And that’s just a handful of the snowiest U.S. cities.

On your home’s roof, excessive snow and ice buildup can cause both property damage and personal injury.  Here are some things to know:
-Understand the Dangers
-Heavy loads of ice and snow can create serious problems for your home. These include:
-Injuries from snow and ice falling from sloped roofs
-Roof collapse, especially on flat roofs
-Carbon monoxide poisoning resulting from blocked chimneys and vents
-Water damage from ice dams that form on the edges of roofs and in gutters

Watch for Warning Signs
Recognize the signs of stress when too much snow and ice has accumulated on your roof:
-Sagging ridgeline
-Drooping ceilings
-Water leaks on interior walls and ceilings
-Jammed doors
-Cracked interior walls near the center of your home
-Creaking sounds
-Avoid Excessive Buildup

Removing ice and snow from your roof is a dangerous job. Avoid injury by hiring a professional to fix the problem before it leads to property damage and expensive repairs. Here are some ways to prepare your home:
-Have a professional clear ice dams and snow from the roof.
-Avoid using salt or chemical snow-melt products to melt ice on the roof. These can erode shingles and gutters and potentially void the roofing manufacturer’s warranty.
-Add insulation to your attic to help prevent your home’s warm air from escaping into unheated attic spaces. Ice dams form when warmed attic air melts a layer of snow on the roof. This melting snow slides down the roof and refreezes on unheated overhangs and gutters. Do not attempt to “chip away” the ice formed by an ice dam as that may lead to shingle damage.
-If replacing your home’s roof, have a self-sealing membrane installed under the shingles to help prevent water damage from ice dams.
-On metal roofs, install snow guards above entrances.


The information in this article was obtained from various sources. While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. These suggestions are not a complete list of every loss-control measure. The information is not intended to replace manuals or instructions provided by the manufacturer or the advice of a qualified professional. Nor is it intended to effect coverage under any policy. 

Equine Insurance 101 – Protecting You and Your Horse, an article from Horse Junkies United

Equine Insurance 101 – Protecting You and Your Horse

September 29, 2013

We all love our horses very much and want to be able to keep them happy and healthy for many years to come. No matter how hard we try though, they still manage to find new and improved ways to hurt themselves.

Lameness can be a way of life for some. Others are just accident-prone or intent on finding that one plant in the field that will make them sick. Since we can’t wrap them in bubble wrap or keep them in padded stalls 24/7, we need to be able to deal with those injuries, illnesses and accidents that inevitably face every horse owner.

Equine insurance isn’t a glamorous topic. We sometimes think of it as a necessary evil or perhaps something we can’t afford. No one likes to believe their horse will colic or need surgery, so owners often roll the dice and play the odds.

Unfortunately, it’s a lot like gambling at a casino. The odds are against you and will always favor “the house”. Equine insurance can shift those odds significantly. I know, because I work for an insurance company that sells equine insurance.

Moreover, I work in the claims department, where we see just about everything that can happen to a horse. We also see what the financial impact can be for owners who elect NOT to purchase insurance.

Medical costs are on the rise, and a typical colic surgery can cost in the neighborhood of $5000 to $7000. There are many factors that will affect that total, including how long the horse was treated medically and if there were any complications after surgery.

Even when the injury to your horse is not life-threatening, veterinary treatment can set an owner back quite a bit of money. If you are the type of person who maintains a “fund” for your horse to cover these types of expenses, then equine insurance may not be for you. However if you are like most of us, you may be faced with decisions you don’t want to make…or a significant debt you will have to pay over time. Equine insurance may be the answer.

Contrary to popular belief, it is not terribly expensive. Depending upon the limit of coverage you purchase, the cost can be very affordable. For major medical/surgical insurance, costs are about $266 per year for a $5000 limit of coverage, about $329 for $8000 in coverage and for a $10,000 limit, the cost is about $371.

Each of these policies would have a $375 deductible. Insurance can be provided to cover horses that are between 91 days old and 15 yrs old (although under certain circumstances, coverage can be provided for foals over 24 hours old and for horses that are 16, 17 and 18 years old). For a premium of $300 or $400, the horse owner can have piece of mind.

Mortality is also a coverage to consider. If your horse dies from a covered accident, injury or illness, mortality coverage will pay you for that loss. It will never replace your horse in your heart, but it can help you find a new one. Insurance is designed to make you whole after a loss. Without mortality insurance, you could be left without funds to buy a new horse.

You can purchase mortality coverage based on your horse’s value. Typically the cost runs about 3.5% of the insured value, so if you have a $10,000 horse, the premium would be about $350. There is no deductible on most mortality policies. The age range for this coverage is also typically 91 days to 15 years, but like the major medical/surgical coverage, under the right circumstances coverage can be written on foals over 24 hours and on horses that are 16, 17 and 18 years of age.

A very important and often overlooked coverage is liability. This covers a horse owner for property damage or bodily

The good life…what we wish for all of our horses.
injury to others, caused by the owner’s horse. For those of you who show your horse, consider the scenario where your horse gets loose at a show grounds and either injures a spectator or runs into someone else’s car/trailer and damages it.

If you board your horse at someone else’s farm, a visitor may be bitten by your horse, or injured more seriously. The cost of adding this coverage is also minimal. For $300,000 in coverage, the cost is around $58; for $1 million in coverage, the cost is about $85….fairly insignificant if you consider what human health care costs are…or the cost of defending a lawsuit brought against you.

While I realize the state of the economy has challenged all of us in different ways, insurance is one thing that can help protect you against unexpected financial losses involving your horse.

Specialized Equine Insurance Coverages Broken Down

Whether for work, breeding, show or pleasure, horses are a substantial investment worth protecting.

With so much at risk, it is a smart idea to have equine insurance that covers the unique situations that horses face.  Below we have the different types of specialty equine insurance broken down with basic descriptions. Take a look below and see if you are properly covered! If not, remember that we are here for you and your horse. You can contact us at: http://www.equineinsuranceagent.com/ today to see if we are licensed in your state!

Coverage	Description
Animal Mortality Coverage	Death coverage on a broad perils basis, including accident, injury, sickness and disease. Theft is also covered.
Animal Mortality Limited Coverage	Coverage for death resulting from a listed covered cause of loss including fire, lightning, windstorm, hail, collision or upset while in transit, accidental shooting, drowning and more. Theft is also covered.
Emergency Colic Surgery Expense Coverage	Coverage for emergency colic surgery expenses as an endorsement to the Animal Mortality Coverage at no additional cost.
Major Medical Expense Coverage	For veterinary medical and surgical expenses incurred for a covered horse as a result of a covered accident, injury, sickness, or disease. Various limit of insurance options are available.
Surgical Expense Coverage	Covers up to $5,000 of surgical expenses incurred to save the life of a covered horse when the surgery is required as a direct result of a covered accident, injury, sickness, or disease.
Loss of Use Coverage	Provides coverage for a covered horse that becomes unfit for its first Use specified in the policy due to a covered accident, injury, sickness, or disease. A limited Loss of Use option covering only accident or injury is also available.
Accident, Sickness and Disease Coverage	Offers protection for a covered stallion that becomes incapable of stud service due to covered infertility, impotence, accident, injury, sickness, or disease.
Coverage Extension Newly Purchased Animal	Provides coverage for newly purchased horses.
Increased Mare Valuation	Increases the limit of insurance on a specifically-listed mare to include the cost of the stud fee/embryo for a specified pregnancy.

(The above chart is from The Harford.com's equine insurance animal mortality page)