The cost of insurance

There are many factors that can affect your insurance premium. We delve a little deeper into how companies calculate what you pay and why at renewal you can expect to see an increase

From age to activities, there are many factors that influence the cost of your premium.

ONCE YOU’VE DECIDED what type of insurance cover is suitable for your horse and have added in any extra options you may require, it’s crunch time — how much will you have to pay? The minimum cover you should have is third party liability. From there you can opt to add in other cover at an additional cost. These include:

Vet fees cover. This is considered the most important addition and is the main reason most owners insure their horse. It will give you peace of mind so that if your horse needs non-routine veterinary treatment you can hopefully make a successful claim.

Death, theft or straying.

Personal accident.

Loss of use.

Saddlery and tack.

Disposal.

Some of these benefits may come as standard on your horse insurance policy; with other policies, each of these will incur an increase to the premium you pay.

There are a number of key factors that will influence the cost of your insurance premium. These include:

Activities — what you do with your horse carries different risks.

Activities such as hacking and riding club activities are usually considered to be low risk. Eventing and showjumping are considered high risk. For more information, see panel, page 23. Your horse’s age — as your horse gets older, there is an increased chance of him becoming ill.

Why do prices vary so much?

The cost of insurance can vary greatly. However, choosing a policy on price alone is not advisable as cover can vary so much from company to company. Take time to read the small print carefully so that you have a thorough understanding of the cover

provided. If you have any questions about the policy, call your insurer to discuss them.

“Most equine insurance companies offer varied policies,” explains KBIS. “It’s worth reading the terms and conditions to clarify any difference in the cover provided. For example, at KBIS we are the only company who offer 15 months’ cover from the onset of an incident for any mortality, vets’ fees, or loss of use claim. We are also unique in offering £6,000 per incident, with an increase to £7,500 for colic surgery.”

Both Petplan Equine and KBIS offer a wide range of policies tailored to suit individual horse owners. This gives you the flexibility to only insure for the activities you take part in and to choose only the benefits you require.

Rising premiums

When your insurance comes up for renewal, it’s not uncommon for your premium to increase — even if you’ve not made a claim.

“An increase in your premium is due to the rising costs in veterinary treatments annually, and the rising cost of paying vet fee claims,” explains KBIS. “Insurance premiums have to match this rise in order to be able to continue to pay out claims. Insurance works by all premiums being paid into a common pool from which all claims are paid. The pool must be kept at an appropriate level to continue to pay out claims.”

There are other factors that may mean a rise in your insurance premium, as Petplan Equine explains.

“Factors including the age of your horse, inflation and the cost of new treatments for horses — your insurance premium reflects the likelihood of you needing to make a claim. “Also, if your situation has changed, this can affect your premium. For example, as your horse gets older, or if you move up a competition level, you may see an increase in your premium.”

Choosing your excess

Paying an excess comes as part of your vet fees cover. Most insurers now offer the option to choose from a range of different excess amounts. If you opt for a higher excess, this will bring down the cost of your premium, but remember that you’ll have to pay the excess every time you make a new claim for a different illness/injury — so make sure you budget for this.

“The excess is the initial amount of each claim you will pay,” says KBIS, “For example, the first £175, £275, £350 or £500 of the claim. By opting for a higher excess, your insurance premium will be reduced.”