Protect Your Horse Sales & Leasing Business From Liability Exposure

In Ontario, selling and leasing horses is a commercial venture where you stand to profit, and that means you open yourself up to liability exposure. We can’t always predict how horses are going to behave in any situation, so you want to make sure that you protect yourself and your business.

What you’ll discover in this report:

  • Potential exposure when you’re selling a horse
  • What you should know about leasing horses
  • Common claims that people make related to horse sales and leasing
  • How you can plan ahead
  • The coverage offered by a Commercial General Liability Policy
  • Other types of insurance you should consider

If I’m Selling My Horse, Am I Really That Exposed?

We’ve all made purchases we’re not happy with after the fact. It can happen when someone purchases a horse too. Buyers always have expectations and if the horse you sell them doesn’t meet their expectations you could get pulled into a claim. How? Because someone gets hurt or property is damaged by the horse you sold.

Whenever someone is interacting with a horse in any way, you’re exposed to liability. If you’re selling or leasing a horse or two each year, that could be normal and you may not need Horse Sales & Leasing Insurance. But if you’re raising a large number of horses and buying and selling more than a couple horses a year, you need commercial liability.

What Do I Need To Know About Leasing Horses?

There are short-term and long-term leases and there are many reasons to lease a horse. No matter the term of the lease, the owner must prepare a lease agreement that includes how the horse is to be used. Some of your liability is relieved if you own the horse when you pass it off to the lessee, but you want to make sure that the lessee is properly insured. And if the lessee has employees that will be exposed to the horse you want to make sure that the staff is insured by Workers Compensation Insurance.

All involved parties should sign an agreement clearly indicating the terms and responsibilities of everyone involved. Some of the items that should be described:

  • Term of the lease
  • Residence of the horse during the lease
  • Purpose of use
  • Conditions of premises
  • Level of care
  • Use and misuse
  • Who pays for any expenses, including food, vet and farrier
  • Return of the horse
  • Future sale of the horse
  • Ownership of major medical insurance
  • Limits of Liability Insurance of lessee

A short-term lease may only last a day or a few weeks. Generally the purpose of a short-term leases is riding. Some owners lease their horses seasonally to schools, camps or resorts. A long-term lease can last anywhere for 90 days to 3 years. In most cases, people use long-term leases to “try out” horse ownership. It could also be for breeding or competition. In many cases, owners include an option to buy the horse in a long-term lease.

What Are The Most Common Claim Incidents Related To Horse Sales And Leasing?

  • While in the trainer’s custody or control, the horse becomes injured or dies.
  • A horse gets loose at a show and causes a car accident. Any injuries to passengers and damage to the car can result in a large claim, and the horse must usually be put down.
  • Bystanders or other horses are injured and/or property is damaged while a horse acts unpredictably in the trainer’s care.

How Can I Plan Ahead?

We know that you care about the horses and the people that come to you for your services. There are steps to take to make sure that an accident never happens in the first place.

  1. Enforce barn rules
    Look around and develop rules for your environment for both horses and people. Also write procedures. Then train every staff member to make sure they understand your rules and procedures.
  2. Plan for emergencies
    Emergencies happen, but the better prepared you are, the better chance you have of providing the proper care to all the horses. If you’re prepared you can minimize the severity of any accident.
  3. Develop semi-annual inspections of your property
    By inspecting your premises for potential hazards, you can take care of them before an incident occurs.
  4. Prepare a written waiver and review Ontario’s Occupiers’ Liability Act
    Anyone who participates in any horse activities on your premises needs to complete and sign the waiver. Make sure that you keep the signed forms on file and safely stored. The Occupiers’ Liability Act states that the stable owner/operator owes a duty of care to the people who enter their premises. This assures that any property they bring on your premises with them is also reasonably safe. You are free to restrict, modify or exclude this duty of care through your written waiver.
  5. Follow Ontario’s Horse Riding Safety Act
    This legislation states that it’s mandatory that anyone under the age of 18 years of age must wear a helmet that meets ASTM, BSI or European Safety Standards and hard-soled footwear with a heel of no less than 1.5 cm.
  6. Purchase an Equine Liability Insurance Policy
    Protect you and your business with an insurance company that knows horses and your business. You want to make sure that any legal feels are covered, claim costs and settlements to ensure that in the case of an accident, your business doesn’t suffer a financial loss.

What’s Included In The General Liability Policy?

This policy protects you from legal costs, claims and settlements from a prospect, buyer, lessee, lessee’s guest, visitor or anyone that visits your business property, invited or not.

  • Bodily injury: Protect yourself from financial loss due to an injury suffered by anyone on your property.
  • Property damage: Avoid having to pay damages to the property of others that occurs in relation to your business activities.

The policy gives you maximum limits or amounts of liability insurance for:

  • Medical expenses: You can be sure a claimant’s low cost medical expenses are covered without a lot of questions about liability or responsibility.
  • Legal defense costs: You can save your business the financial burden of court costs if you’re sued, whether the case has merit or not.
  • Claims or settlement costs: Without this policy you could be held responsible for bodily injury and property damage claims.

Are There Other Coverages I Should Consider?

  • Tack, Equipment and Machinery: Protect your tools of the trade and your business by insuring your tack, equipment and machinery against loss or damage.

At Henry Equestrian Insurance Brokers Ltd., we understand horses and we make sure that we protect you and your business. Contact us today to learn more or click on Get a Free Quote for an obligation-free quote.