Race Horse insurance: the upward trend
October 20th 2016
By anyone’s reckoning, owning a race horse is a high risk investment. With purchase prices ranging from a few thousand to several hundred guineas and training fees in the region of £20,000 a year, it is only the very best horses that provide a return on investment. A specialist race horse insurance policy is therefore worth considering.
In spite of the financial risks, many of us are inspired by the thrill of ownership and consider the pleasure received from being involved in the Sport of Kings to be worth the significant financial outlay.
Even the most enthusiastic of owners will not be blind to the very real risk of losing a horse and the sad fact is that race horses can and do die. No one can protect themselves from the emotional devastation of an on course death, but race horse insurance can mitigate the financial implications.
Yet, of the 14,000 horses in training in the UK, only a limited proportion is currently insured. A surprising aspect of this concerns National Hunt horses which are 2.5 times more likely to die than those who race on the flat, but are less likely to be insured. For those who own multiple horses there is, of course, self-insurance. But few involved in the racing industry are able to afford to do this properly. The average race horse owner has only one horse in training, or a proportion of one or two horses. By insuring a horse, not only is the owner’s investment protected, but the trainer – usually a small business – is also protected from loss of income.
The question must be why do so few take out race horse insurance? After all, assets of any value are usually insured. In the case of race horses, the insurance can also go beyond simply providing the funds for a replacement as owner can choose to add cover for emergency surgery.
In recent years there has been an upward trend towards more owners insuring. Within the total package of ownership, insurance is seen as a cost which makes sense and more people are also purchasing cover for Emergency Life Saving Surgery costs. Owners with multiple horses often opt for a large excess, commonly known as a deductible, which reduces the annual premium while still paying out a good percentage of an individual claim.
Whatever the circumstances, it is worth talking to our specialist bloodstock insurance team who understand and are familiar with all aspects of race horse insurance.
