A recent federal court case in the Midwest strongly upheld an insurance company’s complete denial of an equine mortality insurance claim because the owner of the horse failed to give the company prompt notice of an injury to the horse – an injury that ultimately resulted in the horse’s death. The company successfully argued that if it had received notice of the claim in a timely fashion, it could have secured better veterinary treatment of the very valuable horse – treatment which would have likely resulted in the animal’s full recovery and thus avoided the owner’s devastating decision to euthanize the animal. This case reminds us all of the critical need for us to carefully comply with the terms of our equine health and mortality policies or the result can be that we receive no claims proceeds at all – even when we end up losing our beloved animal.
An insurance policy is a contract. Virtually all insurance contracts require that, as a condition to coverage, the company be given immediate or prompt notice of any potential claim. Such a requirement makes sense. The insurance company wants the opportunity to proactively participate in the resolution of the claim so as to hopefully help reduce the loss for you, especially when you are facing an equine lameness or health issue. Prompt notice can further aid insurance companies with conducting a thorough, timely investigation into an equine death, a critical factor for mortality companies because of the rampant insurance fraud which riddles many sectors of the equine industry.
Many people are afraid to contact the insurance company because they fear an increase in premium in the future. We all know the feeling of deciding whether to allow our automobile insurance company to pay for a small claim or whether to pay for it ourselves after we consider our deductible and the possible impact the claim might have on our insurance rates in the future. And as a result, most of us end up paying small claims ourselves. Claims on our homeowner’s policy are similar. If someone breaks into our home and steals a $500 television, we weigh the advisability of filing a claim with our homeowner’s insurance company and what it might cost us in increased premiums in the future.
The critical difference here is that horses are not automobiles nor are they homes. We need to stop thinking of them that way when it comes to insurance claims. They are more like people, frankly, at least in this context, and we need to consider whether we would let our health insurance company know if we ourselves had a serious injury or not. What if the health insurance company could refuse to pay our medical bills if we did not notify them of our injury quickly enough? They probably could deny the claim, truth be told, but our health system is structured so that we often cannot obtain medical treatment at the doctor or hospital without telling them our insurance information first. Then they notify the company of our injury or illness for us. We do not really have a lot of choice in the matter. If equine veterinarians required us to share equine insurance information up front, this article might not be as timely because the veterinarians would likely be notifying the insurance companies for us and we would not have the decision to make about when and whether to notify them. But typically, at least where I live, equine veterinarians do not ask for insurance information before they treat the animal. I cannot remember ever having a veterinarian (or their staff) ask me for insurance information. I am sure it probably happens more and more as more people insure their animals and/or veterinarians become increasingly concerned about getting paid, but it is not the norm around where I live at this point in time. And may not be where you live either.
Moral of the story – if your horse turns up lame or is injured or sick, advise your equine health or mortality insurance company as soon as possible because they may have a national network of contacts which could help your horse receive more or better treatment sooner – treatment which may end up saving his or her life and perhaps his or her soundness as well. The equine insurance carriers are your partners, not your adversary. Use them as such! Get your money’s worth and utilize all the loss prevention tools they have available for you. And it would be a terrific idea for you to right now, while you hopefully do not have a claim, to call to speak with your company’s “loss prevention” or “risk management” department to see what resources they may have for you in the event you do have a claim. You might be surprised how much they can help you and your horse!
If you get into a bind and need assistance or just want to ask some questions to avoid getting in a bind, feel free to email me at firstname.lastname@example.org. I often will answer a short and simple question for free if I have time and know the answer off the top of my head! If you don’t hear back from me quickly, it’s not because I don’t love you or think you have a great question or because I don’t know the answer (usually), I’m probably just really busy and haven’t had a chance to email back. And you can always buy the first hour of my time for $250 (my usual hourly rate for 2013 is $325). Lots of folks will save up all their equine (and some corporate or real estate) legal questions and short documents and sit with me for an hour and we will do as much as we can during that hour and it’s only $250. You can check out my Twitter feed @nchorselawyer as well as our firm’s Equine Law Group web page at http://www.rl-law.com/equine if you’re interested, and yes, in addition to providing what I hope are interesting and informative stories, this blog and the Twitter feed referenced above are also (in one way or another, I guess) an advertisement for legal services.