Ask Your Insurer Presented By Muirfield Insurance: Protecting Foals Before They Hit The Ground

by | 11.14.2019 | 5:18pm

Equine insurance experts answer your questions about insuring Thoroughbreds for the breeding and auction realms. Email us at [email protected] if you have a question for an insurer.

QUESTION: What options are available to insure the in-utero foals that are purchased with a broodmare at auction?

BRYCE BURTON: In Utero, or Prospective Foal Insurance (PFI), can be put into effect once a mare has been declared 42 days in foal or more. This coverage can be effected not only during the breeding season of the year bred, but also on mares purchased at public auction.

The total amount of coverage put in place is usually determined by the purchase price at auction. The general rule of thumb provided by the carriers is that the maximum amount of coverage that they will place is up to two times the stud fee of that unborn foal or 50 percent of the purchase price at auction, whichever is less. The remaining amount of coverage (purchase price less the amount placed for PFI coverage) will be placed in the form of Full Mortality on the mare herself. In certain circumstances, values can be submitted to the underwriters for approval.

Bryce Burton

The first decision that the insured is faced with is with respect to the insured value of the PFI policy. For example, if a mare is purchased for $100,000 at auction and is carrying a foal by a sire whose stud fee was $20,000 in 2018, the policyholder is able to set a value of up to $40,000. The remaining $60,000 of the purchase price is then covered under a separate Full Mortality policy on the mare.

The options provided by the carriers also relate to the length of the coverage following the birth of the foal. For example, the insured has the option to place Prospective Foal Coverage to 24 hours, 7 days, 30 days, 45 days, and even 1 year after birth in 2019. A veterinary certificate is not required on the foal until the Prospective Foal policy is expired at one of those aforementioned time frames. There are a couple of carriers who offer automatic rollover, meaning that the PFI policy is automatically rolled over into a Full Mortality policy on the foal, with no veterinary requirements, for a full year following the foal's birth.”

Bryce Burton is a property and liability specialist for Muirfield Insurance. He is from Frankfort, Ky., where he grew up an avid race fan. His Thoroughbred racing fandom combined with a collegiate internship in the insurance industry, culminated in a start in the equine insurance field. Bryce has been with Muirfield Insurance since 2014, following his graduation from Transylvania University in Lexington. P

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