Insuring a No Guarantee Stallion Season

[madelyn]

I seem to recall a discussion about this, but can't locate it. I know it is POSSIBLE to insure an NG season purchased (like one from one of the auctions) but cannot recall the specifics.

Does anyone have any knowledge/experience doing this? I have one mare left looking for a date (not Rocking Trick material, pedigree-wise), and an extremely limited budget. She is also due fairly late (5/23) so I have limited breedback opportunities (<=2). She needs a KY stallion and anything standing cheap would be under-breeding so I'm looking at the NG seasons...

[LB]

A friend of mine who sells insurance told me a couple of days ago that the rule of thumb is that a NG season should cost 1/3 less than a LF season because it's going to cost you approx. that third you don't spend on the season to insure it.

[madelyn]

So you are saying that the insurance would be 30% of the published fee?

[LB]

So you are saying that the insurance would be 30% of the published fee?

That's what I was told. Bear in mind that the insurance needs to cover you for all sorts of eventualities like the stallion dies, or becomes infertile, or colicks and is taken out of service. Or your mare dies, or can't get booked when she needs to, or doesn't get in foal. So I guess it's roughly double (or a bit more than) the cost of prospective foal insurance that starts when the mare is already in foal.

[da hossman]

To insure a NG season to make it the equivalent (actually better than a Live Foal Stand and Nurse season because coverage typically extends to 7 days or 30 days after foaling) one must buy Stallion Availabilty, Conception and Prospective Foal Insurances - often sold as a package.

Stallion Availability is the least costly of the three and rate is primarily determined by the stallion's age. Conception considers the stallion's fertility for the last 3 years and the mare's complete produce history. Prospective Foal considers the mare's reproductive history only as it actually begins once the mare is 45 days in foal. A relatively young fertile stallion and a relatively young mare with no blemishes in her produce history can expect a total package rate of 25-30% if she is in central KY at a reputable farm using a reputable vet.

The NG season market all but disappeared after the MRLS years of 2000 & 2001 because PF rate went through the roof. Insurance has now come back down to realistic rates. Before MRLS a very effective strategy was to breed a young broodmare prospect on a NG season (typically 65% of the LF price), insure the season and sell her in foal - thereby receiving a little bit of a return premium as one would cancel the PF coverage after the sale. In this way one could effectively breed the mare without risk for ~ 80% of the LF price, thereby increasing any potential profit.

I highly recommend PF insurance on any mare purchased at auction because of the stress of the sales ground coupled with the exposure to so many horses from so many different places. At this last Keeneland January Sale one of the expected sales toppers aborted at the sales and was scratched. Most Prospective Foal policies void the coverage when a mare arrives on the sales grounds, so be sure to read your policy closely or question your agent directly about this exposure and where it is covered in the policy/contract language.

[da hossman]

Madelyn if your mare is not due to foal till late May I would not buy a season now. Every stallion's book loses a mare ot two before the end of the season and stallion managers will often discount a late opening in order to fill it.

You also do not yet know how your mare's foaling will go - a dystocia or a tear could prevent her from being bred back this year and if you have purchased a NG season you will have spent money on something you cannot use.

[pokeyman]

Madelyn if your mare is not due to foal till late May I would not buy a season now. Every stallion's book loses a mare ot two before the end of the season and stallion managers will often discount a late opening in order to fill it.

You also do not yet know how your mare's foaling will go - a dystocia or a tear could prevent her from being bred back this year and if you have purchased a NG season you will have spent money on something you cannot use.

Very good information on insuring!! Thank you.

I don't want to put words in her mouth....but maybe she's looking now as that's when all the stallion auctions are held?

[madelyn]

Thanks, everyone, for the info on the insurance.

I understand completely about the books softening up; I booked some last year in April when this had happened, and got 50% off on one and a buyback on the other. I AM looking at the auction seasons. As usual I have a Plan A, B, and C.

[clh]

I too have heard the same info based on LB's info. Basically, insurance company basically knows what the share costs, stallion farms know what the insurance would cost and basically you end up spending essentially the same. (does not mean they are in cahoots )

[jeff9061]

I bought a season out of an auction last year. It was NG. But I called and talked directly to the farm, told them what I was interested in, they liked the mare, and I told them if they'd guarantee the season I'd purchase. They agreed. I notified the state hosting the auction, they confirmed with the farm, I bought. It wasn't insurance, it was simply a stand and nurse guarantee with a breedback next year. KY stallion, stood for around $7,500 I believe, bought for $3,500. Like you, I was on a budget and didn't want the risk. But I was breeding earlier, and did need to send that mare back once. Not sure if this is what you're looking for. If not, I'd go the route mentioned above -- wait and see what's available when you're ready. Short story, I guess I'd call the farm of the stallion you're interested in and see what you can work out. The state associations don't care, in my experience, they just want a bid. You're just helping everyone get what they need.

All that said, I'm bidding on a stallion online right now, so don't bid ME up!

[jeff9061]

I bought a season out of an auction last year. It was NG. But I called and talked directly to the farm, told them what I was interested in, they liked the mare, and I told them if they'd guarantee the season I'd purchase. They agreed. I notified the state hosting the auction, they confirmed with the farm, I bought. It wasn't insurance, it was simply a stand and nurse guarantee with a breedback next year. KY stallion, stood for around $7,500 I believe, bought for $3,500. Like you, I was on a budget and didn't want the risk. But I was breeding earlier, and did need to send that mare back once. Not sure if this is what you're looking for. If not, I'd go the route mentioned above -- wait and see what's available when you're ready. Short story, I guess I'd call the farm of the stallion you're interested in and see what you can work out. The state associations don't care, in my experience, they just want a bid. You're just helping everyone get what they need.

All that said, I'm bidding on a stallion online right now, so don't bid ME up!

[merse]

A word of advice (by one who was previously burnt): Check with your insurance company before you purchase the NG season because some things (stallion's age, etc.) will not allow them to offer you the insurance.