Posted 22-Jun-2019 01:10:55
Category: Broadstone Equine
There are a lot of changes happening in today’s equine insurance market, and a few of those impact horse owners in significant ways, so I thought I would address one specific area – coverages that help reimburse for veterinary expenses.
In the last several years, due in large part to drastically rising claims costs—most significantly related to medical and surgical claims—insurance companies throughout the U.S. have made changes to their coverages, often referred to as Major Medical/Surgical, Veterinary Assistance, and Medical Assistance. These changes range from the easily understood increases in premiums and deductibles, and additions of co-pays and coverage sub-limits, to only allowing these coverages on horses valued at certain amounts, or restricting the limit of coverage based on the horse’s insured value. In the following blog, I’ll try to address these areas in more detail.
First, while the knee jerk reaction by many consumers is to feel that with these changes the insurance company is trying to take advantage or rack up huge profits, in my experience, this is not the case. Over the last decade there have been great strides in veterinary medicine, from the availability and types of diagnostic tools, to high tech and more effective treatments for lamenesses and illnesses. This is great news for horseowners around the world. The sooner we can diagnose a problem, and the more advanced our treatment options, the better chance we have for our horse’s full recovery.
Of course, along with those technological advances come increased costs, and this is when over time the insurance companies have seen an increasing tide of claims expenses coming their way, enough so that changes become necessary if the companies are going to be able to continue to offer the coverage.
What do you mean, my horse isn’t worth enough to have Major Medical/Surgical, Veterinary Assistance, or Medical Assistance coverage?!?!
This is a question being asked by many horseowner’s these days, even those whose horses have been insured for years. Many companies have instituted minimum value requirements for horses to be eligible for these coverages, therefore with these companies if you have a lower valued horse, you may just have no options for this sort of coverage (with these companies – see below as there are some companies that may be more accommodating).
**Broadstone does work with companies that have more flexibility regarding the amount of Major Medical/Surgical, Veterinary Assistance or Medical Assistance coverage they will offer in relation to the horse’s insured value. Providing the horse otherwise meets the required underwriting criteria, you could insure the horse for just $1,000, and still have anywhere from $5,000 to possibly up to $15,000 of these coverages, depending on the company. Go here for a Quote.
This can be especially useful if you have recently purchased a horse, such as an off-the-track-Thoroughbred, for an inexpensive amount. Or if you adopted or were gifted a horse. In these cases, you will likely still want the protection of some sort of medical and surgical coverage, and we should be able to help you achieve that.
What about diagnostics? They are getting more and more expensive, and now the insurance companies are making me pay out of pocket.
Most all companies these days require a co-pay or co-insurance, often specifically with regard to diagnostic testing. Basically this usually means that you will be responsible to pay a percentage of certain expenses out-of-pocket (though talk to your agent for specifics). With some companies, this percentage may be restricted to the type of diagnostic test, for others, it will be across the board for all diagnostics. And for other companies, there might be a co-insurance on all expenses, not just diagnostics--again, talk to your agent for details.
We currently work with companies that handle diagnostics in different ways. One applies the percentage out-of-pocket to only certain types of diagnostics, which can be a good compromise. One puts a dollar limit on diagnostics. Some require a percentage to be paid by the insured for all diagnostics, but depending on the horse's insured value will allow the insured to pay an additional premium to waive that diagnostic co-insurance clause. So if you are particularly concerned about the potential costs of diagnostic tests of all kinds and willing to pay an additional premium, providing your horse otherwise meets the underwriting criteria, you could potentially see about waiving the diagnostic co-insurance clause.
What about older horses? I heard that I can't get coverage for Medical or Surgical expenses on my 15-year-old horse?
Actually many companies will offer these coverages for horses through the ages of 18-20 if the policy is a renewal without a lapse, though rates for the Full Mortality coverage generally begin to increase at around 15 or 16, so the Mortality premiums will increase. In addition, the limits of Major Medical/Surgical, Veterinary Assistance or Medical Assistance coverage available for older horses may change over time.
With all these changes to these coverages, is it really even worth it?
For me, the quick answer is a resounding “Yes!” Having been in the industry for much of two decades, I have seen simple hoof abscesses turn into surgery, and unexpected illnesses result in a week of hospitalization, not to mention the usual colics, lamenesses, and injuries– and all of these easily and quickly add up to thousands in expenses. Insurance is a bit of a hedging of bets, so yes, you could pay a premium that you will never recoup. But for all intents and purposes, that would be the best case scenario. If you do need to use your coverage, while there will be (and always have been) deductibles and possibly co-insurance and other coverage requirements that will not reimburse you for every dollar of your expenses, having some sort of Medical or Surgical coverage can allow you to handle as many expenses as possible in your horse’s road to recovery.
**These blogs are for basic information purposes only, and do not constitute advice from Broadstone Equine Insurance Agency. Contact our office directly at 888-687-8555 or info@BroadstoneEquine.com to speak with an agent for complete and current information regarding all coverages.
Insuring Your Horse - Commonly Asked Questions