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FAQs About Liability
Coverages
Liability policies are available in all U.S. states
except Alaska and Hawaii.
Whatever your equine activity, you should consider obtaining
liability coverage.
Equine Limited Liability Laws may help you provide
a defense in the event of an equine incident, but they
will not prevent you from being sued. Liability policies
are designed to help protect you if you are sued by
a third party who is injured or whose property is damaged.
The policy covers defense costs and pays claims for
which you are legally liable up to the policy limits.
| 1. Equine Personal Liability |
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Many horse people assume they have coverage for
their equestrian activities under their homeowner's
policy, but if you check with your agent, you
may find that you do not.
The Equine Personal Liability coverage provides
financial protection for horse people by providing
coverage for bodily injury or property damage
caused by your personal horse to a third party.
With the limits available, Equine Personal Liability
Coverage is an excellent way to provide protection
for your horse activities whether showing, trail
riding, or simply enjoying your horses in your
own backyard.
See the application for the available limits
and premiums. Policies include coverage for up
to five named horses with the option of adding
more.
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| 2. Equine Commercial
General Liability Coverage |
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If you are a professional equestrian (a person
who performs a horse-related service for a fee
or for barter such as boarding, instruction, training,
buying/selling, breeding, officiating, organizing
or hosting shows and clinics, etc.), you should
have an Equine Commercial General Liability (CGL)
policy.
This policy protects you in the event a third
party sues you for bodily injury or property damage.
A third party is generally someone who is not
a family member or employee. If you have employees,
you should obtain workman's compensation or employer's
liability coverage. Also, you should make sure
that any independent contractors or vendors that
work with you show proof of their own liability
insurance and ask that you be named as an Additional
Insured on their policy, especially if they are
an independent instructor and/or trainer working
at your facility.
Coverage under the CGL policy provides for defense
costs as well as pays claims for which you are
legally liable up to the policy limits. Occurrence
limits are available at $300,000, $500,000 and
$1,000,000. Double aggregates, triple aggregates,
and excess coverage are also available.
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| 3. What is a double aggregate?
Triple aggregate? |
| The double aggregate doubles the amount of coverage
that is available during the policy period but does
not increase the occurrence limit. Triple aggregate
triples the amount of coverage that is available
during the policy period but does not increase the
occurrence limit.
For example, if you have a $1 million per occurrence
limit and select the double aggregate, the policy
will pay a maximum of $1 million per any one occurrence,
and a maximum of $2 million in the year. So you
could have two, separate $1 million claims paid
in the same year, or four separate $500,000 claims.
But if you had a single, $2 million claim, only
$1 million would be paid by the policy for that
occurrence. This is why you should consider excess
coverage.
Triple aggregate triples the amount of coverage
that is available during the policy period but
does not increase the occurrence limit.
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| 4. What is excess coverage? |
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If you decide on the $1 million occurrence limit,
and either the double aggregate or triple aggregate,
you may also purchase an excess policy. This has
the same coverage terms and provides additional
limits available in $1 million increments.
For example you could have $1 million per any
occurrence, $2 million aggregate per year, and
then add $1 million excess policy which allows
you a maximum of $2 million to be paid on any
one occurrence, and a maximum of $3 million aggregate
paid in any one year.
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| 5. What is the professional
liability endorsement on the CGL application? |
| This coverage will protect you in the event you
are sued in respect of a claim directly resulting
from any negligent act, error, or omission arising
from your professional equestrian activities. For
example, if you are a professional and make a ruling
or decision to the detriment of a competitor and
they sue you, this coverage that would provide for
your defense fees and pay claims for which you are
legally liable for up to your policy limits. |
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| 6. What is the equine personal
liability endorsement on the CGL application? |
| If you own or lease horses that are for your own
personal pleasure or show and are not involved in
your business, you can add this endorsement to your
CGL policy. This coverage will protect you in the
event one or your horses injures a third party or
damages their property and you are sued. As with
the other liability coverages, it will pay for your
defense costs as well as pay any claims up to the
policy limits. |
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| 7. I own a boarding facility
and allow several independent instructors and trainers
to work here. I do not pay them, they are paid directly
by their clients. Do I need liability coverage for
this? Should I insist they have liability coverage?
Can I add them to my policy? |
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Yes, you should get coverage for the riding instruction
that takes place at your facility even if you
do not teach the actual lessons. Unfortunately
if there is an accident during one of the lessons
and a rider or bystander is injured or their property
is damaged, you could be sued along with the instructor
even though you may have had nothing to do with
causing the accident.
Yes. You should insist the independent instructors
and trainers have their own liability coverage.
If they do, you should ask to be named as an Additional
Insured on their policy. You should also request
a Certificate of Insurance showing that they have
a policy in force and that you have been named
as an Additional Insured.
If they do not have their own policy, you can
add an independent instructor or trainer to your
policy. This will only provide coverage for them
when they are working at your facility, but not
if they leave your premises. If they want off-premises
coverage, they should get their own policy.
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| 8. I am an Independent Instructor
and teach out of many facilities. What kind of a
policy do I need? |
You can get a CGL policy for your riding instruction
that will follow you wherever you teach and coach
(i.e. various facilities, horse shows and events).
It can also cover you for any clinics you may give.
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| 9. The owners of the facilities
where I work have asked that they be named as Additional
Insureds on my policy. What is an Additional Insured,
and how much does it cost to add one? |
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An Additional Insured is a person who has a connection
to your equestrian activities and therefore wants
coverage under your policy in the event they are
sued due to your actions.
An example would be an owner of a facility where
you are an independent instructor. If you are
giving a lesson and a student or bystander is
injured, they most likely will also name the owner
of the facility in the lawsuit as well yourself.
By having the facility owners named on your policy,
the policy will also provide them with a defense
and pay claims up to the policy limits.
The cost of naming an Additional Insured to your
policy varies with the policy limits. For a policy
with a $1 million occurrence limit, the charge
is $20 per Additional Insured.
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| 10. I have my clients sign
a release of liability. Why do I need a liability
policy? |
| Although it is a good idea to have clients read
and sign a release of liability, this does not prevent
you from being sued. A CGL policy would provide
you with coverage for your defense costs and pay
any claims up to the policy limits for which you
are legally liable. |
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| 11. I am a very careful person.
I have never had any incidents. Do I really need
coverage? |
| Hopefully your perfect record will continue, but
unfortunately accidents can happen. Even though
you may not be at fault, you still may be sued.
The insurance policy provides for your defense fees
which can be significant no matter what the circumstances
of the accident. |
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| 12. We have an equine limited
liability law in our state. This protects me from
being sued so I don't need an insurance policy,
right? |
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Though the equine limited liability laws are
a good first defense to help prevent frivolous
lawsuits or a lawsuit arising from the inherent
risk of equestrian activities, they do not protect
you from being sued. Also, while most state equine
liability laws refer to the inherent risk of riding
and working around horses, they are not intended
to protect you if your actions were considered
negligent.
For example, if you are teaching a lesson to
an experienced rider on her own horse using her
own tack and she has a fall, most likely the equine
limited liability law will help you as she should
have understood the inherent risks of riding horses.
But if you have a new student riding a school
horse and the horse is too much for her to handle
or the tack is unsafe and she is injured because
of your negligence in matching her with the wrong
horse or not checking the tack, the equine limited
liability laws probably will not protect you.
In both of these cases, at the very least you
may have to defend yourself, and the insurance
policy will pay for this. The defense attorney
may utilize the state equine limited liability
laws and the liability releases to help defend
you. If a claim or settlement is then paid, the
policy will pay for that as well up to the coverage
limits.
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| 13. I am part of a local equestrian
association. What type of coverage do we need? |
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You should look into a Clubs and Associations
policy. This is a liability policy that protects
the club and its members in the event of a lawsuit
by a third party for bodily injury or property
damage. The policy will pay for your defense costs
as well as pay claims up to the policy limits.
The basic policy covers the organization year-round
for club member-only functions, and includes coverage
for seven listed public event days with additional
days available. A public event day is an event
the organization runs such as a horse show, event,
or clinic to which the general public is invited.
This policy covers you for the actual event days
and includes days for setup and takedown.
You can also add Additional Insureds to the policy
as necessary such as a facility owner or landowner
where events take place.
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| 14. I only want liability
coverage for one event. Can I get just a single
event policy? |
Yes. You can purchase an Equine Event policy. This
will cover you for a single horse show, equestrian
event, or clinic. You choose the number of event
days to be covered, and coverage is also provided
for setup and takedown. |
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| 15. I board and train horses
and someone mentioned I should look into Care, Custody
and Control coverage. How is this different from
the CGL policy? |
| Care, Custody & Control (CCC) is what protects
you in the event a horse that is in your care that
you do not own (a boarded horse, horse in training,
etc.) is injured or dies, and the owners sue you
because they believe you or your employee were at
fault. The standard CGL policy does not cover these
situations, but you may add CCC coverage to your
CGL policy or obtain CCC coverage by itself. |
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| 16. All of the horses at my
barn are insured by their owners, so I don't need
CCC coverage, right? |
| Actually you still need this coverage. If one
of those horses dies and the insurance company pays
the claim but they believe you or your employee
were negligent in causing the horse's death, you
can still be sued by the horse owner or their insurance
company. If this happens, the CCC policy will pay
for your defense and pay claims up to the coverage
limits. |
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| 17. I occasionally trailer
boarded horses to shows for their owners. Will the
CCC cover me for trailering? |
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The CCC policy will cover you for incidental
trailering of clients' horses (i.e. to a show,
clinic, veterinary hospital) if you are found
negligent in causing a horse's injury or death.
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