Losing a horse is one of the most difficult, if not the most difficult aspect of horse ownership. On this topic, one of the most common questions we receive from owners is, “Are West Point horses insured?”
West Point Thoroughbreds carries mortality insurance (basically a life insurance policy) on all of our horses, and each horse is covered for their purchase price at auction or private sale. A full mortality policy provides coverage for death as a result of injury, illness, or humane destruction, and includes loss or death as a result of theft. The insurance company also provides emergency colic surgery coverage up to $5,000 as part of the mortality policy. For a policy covering a horse of racing age, premium rates range from 4.5% to 6.5% of the horse’s value for one year’s coverage, and the premium is based on his age, use, level, and value.
These mortality coverages are adjusted over time, based on performance. If a horse is very successful on the racetrack, their coverage will likely be increased. If a horse runs in a claiming race, their coverage must be decreased to the claiming price or below on the day they are entered. We review the coverage on all of of our horses on a regular basis and adjust based on their performance on the racetrack.
When we purchase a horse at public auction, they are insured at the “fall of the hammer” since our policy is already in place and a vet exam is typically not required. In the case of private purchase, a veterinary exam is required to prove the horse is in good condition before coverage begins. It is very important to keep the insurance company informed about any changes to a horse’s health (injury, illness, surgery, etc.).
All of our policies are “agreed value”, which provides the assurance of knowing the amount the Partners will collect in the unfortunate event of a loss. Other companies’ policies may state the most the company will pay is the “fair market value or actual cash value” of the animal at the time of the loss. This provides no guarantee that the amount the horse is insured for is the amount that will be collected. A veterinarian’s report and/or necropsy is required to process a mortality claim.
There is no loss of use or disability insurance for racehorses because of the high potential of loss that exists. Medical insurance is also not available for active racehorses. One of the benefits of owning horses in a partnership is spreading the risk and the expenses so that no one individual is responsible for all veterinary costs. Each Partner pays their pro rata share of the insurance premiums.
An insurance settlement can never replace a horse, but it provides financial protection for our clients and makes the ownership process smoother. One of the reasons people get involved with partnerships is avoiding the day to day financial and administrative tasks and leaving it up to a group of professionals. In our 20+ years of experience, having mortality insurance on our horses is the way to go.