FOR IMMEDIATE RELEASE — MARCH 21, 2012 — What does liability really mean?
Just looking at insurance documents can strike dread in even the most stalwart of souls. Wading through terms unique to the insurance world and vague to the rest of us is confusing, yet most of us recognize that we need some form of insurance in our lives. We gulp, take a deep breath, and plow forth, hoping that our insurance ignorance will not become too apparent and that we can somehow deduce the right answers.
Just as “oxer,” “indirect rein,” and “hunters under saddle” can sound like a foreign language to parents whose child has newly entered the realm of horses and shows, so do terms like “subrogation,” “casualty loss,” and “policy limits” when filling out an insurance application and trying to determine what kind and how much insurance is appropriate.
To help you untangle the web of insurance terms, we have identified some of the most common terms horse people encounter when addressing insurance issues and will present them in a series of articles for your education. This material is meant as a guide and not as the definitive legal definitions of insurance terms. Your insurance agent should be able to explain terms thoroughly and guide you through selecting the appropriate insurance coverage policies and amounts for your particular situation.
Please note: every situation, horse, owner, and policy is different. While we can provide some general information, you should consult your agent about how these policies and situations apply to you. Remember, the job of your agent is to be your advocate, understand your needs, and explain things to you in a clear, concise manner.
Liability policies are among the most common, and most important, that owners, riders and professionals in the horse industry need to consider when purchasing insurance. In laymen’s terms, liability is synonymous with responsibility. If you are deemed responsible for your actions, the actions of others, or even the actions of horses you may own or be riding, you could be considered liable in the case of an accident that causes damage to people or property. In addition, even if the judge determines you were not liable, you will still have a significant legal defense bill to pay, and your insurance policy can help with that. Horses are unpredictable, and anything can happen to anyone at any time, regardless of how careful they are. A liability policy can save thousands, hundreds of thousands, or even millions of dollars in legal defense and claims, up to the amount specified in your policy.
For example, if you are riding your horse and your horse kicks out and damages a car, you can be held liable for the damage to the car. As a horse owner, you can protect yourself with a Horse Owners Liability policy. As a trainer, your general liability policy will protect you.
If you are a trainer or riding instructor and a student falls off and gets hurt, you could be held liable regardless of the reason the person fell off. Generally, if the accident is serious you are more likely to be accused of being liable. If the student was riding one of your school horses, your level of liability is even greater. Negligence is the term courts use to determine if a person is liable in a given situation. A Commercial Equine Liability policy or a Riding Instructor’s policy will provide both legal protection and pay a claim that may be levied against you. While no one wants to be in this kind of situation, sometimes bad things happen, and when they do you will want help paying your legal costs.
Whether a horse owner, trainer, or horse show manager, there may come a time in your life when you are held liable for damages. Here are some real cases where a liability policy came into play. While these were all unfortunate situations, the responsible parties were fortunate in that they were covered by their policies:
At a horse show, a horse in a temporary stall bit an extension cord and was electrocuted. The owner sued the horse show, but after several letters between the parties’ lawyers, the complainant dropped the suit. The show had coverage, and their policy covered their legal fees.
A horse ran into the hood of a car and damaged it, and the owner of the horse was held liable. They had the proper coverage, and their policy paid the claim.
A horse escaped from a trainer’s property and got out on the road. A car struck the horse, and the collision caused property damage and personal injury. The trainer’s liability policy covered his legal defense plus the claim up to the limit as stated in his policy.
Some things to consider when evaluating a liability insurance policy:
- Can you afford extensive legal bills?
- Can you afford a claim for $100,000 or greater?
- Most boarding stables will require a resident trainer to carry a liability policy and provide proof of insurance.
Your insurance agent should spend time with you going through your business operation. The more information you give your insurance agent, the better your agent can help you identify the most appropriate coverage. If you don’t tell your agent about a portion of your business activities, that part of your business may be excluded if there is a claim. For example, if you don’t tell your agent that you have two school horses you use for lessons, your insurance company may refuse to cover you for riding lessons given on your school horses if someone falls off and files a suit against you.
Insurance may seem costly and unnecessary until you need it. One major claim, whether you are found liable (responsible) or not can cost tens of thousands of dollars in legal fees, not to mention the stress. A liability policy can potentially save not only a lot of money, but your business. The staff at LEGISequine.com have the expertise to help you sort through the gobbledygook and make sure you have the right insurance coverage for you.
LEGISequine.com is staffed by horse people experienced in many different aspects of the horse industry and provides a wide range of insurance coverage for horse owners, riders, professionals, facilities, and event managers. For more information about LEGISequine.com, contact [email protected].
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