2023/2024 Alpaca Owners Guide

INSURING YOUR ALPACA The Basics BY DEB GALE

A fter many hours of research on the Internet, attending shows, and visiting breeding farms, you are ready to purchase your first alpaca. You are excited, anxious, and have a long list of things to prepare for your new arrivals, such as fencing, shelter, feed, veterinary care… and all this before you sign the contract and take delivery! Your first priorities will be the care and protection of your new animals, but who will be protecting your financial investment? One of the first and most important things on your list when purchasing an alpaca is to get mortality insurance in place, especially when the seller is financing the purchase and requires insurance while they’re carrying the note. Insurance can be secured by the buyer as soon as the contract is signed by both parties. You don’t have to wait until the AOA certificates have been transferred. So what is mortality insurance and how do you go about insuring an alpaca?  Insurance False Assumptions

is that the policy is annually renewable and requires a new application, health declaration, and underwriting process each year before the renewal date. As with any insurance coverage, the policy is there to protect your financial investment and will indemnify you for the price you have paid plus travel costs, sale, or financing expenses. It is not possible to insure the alpaca for more than its sale price but, as with fine art, an alpaca’s value may fluctuate, depending on subsequent sale prices. Any increase during the policy period will need to be reviewed and accepted by the insurer and a new health declaration will be required. Alpaca mortality insurance only pays in the event of death or humane destruction as a result of an accident, illness, injury, or disease. It does not pay when an animal becomes sick or cannot breed, nor does it pay any associated veterinary bills. It will, however, cover you while at any location within the United States or Canada. This is an important part of coverage, particularly when traveling around the country for shows or moving animals from a sale back to the farm. Another option is alpaca “named perils” insurance, which is available for a lesser rate, but with far more restrictions. It does not cover death as a result of accident, illness, or disease, but covers a specified list of perils which include fire, lightning, wind, hail, transportation, theft, accidental shooting, and attack by dogs or wild animals. Please consult your insurance agent for specific details if you are interested in this type of coverage. Animal mortality insurance is quite simple; you don’t need to worry about fine print or hidden exclusions when an animal is healthy, and paperwork is completed honestly and properly during the application process. Livestock policies are written based on “agreed value,” which means once you have justified the value at inception, that is the agreed price if your animal dies. This all provides a much less stressful experience in the event of a claim.

Perhaps you’ve heard that upon purchase, an alpaca can be insured above its purchase price. Or that it can be renewed each year with only payment of required premium, and also that there is a 15-day grace period after expiration.  Reality Alpaca mortality insurance is a specialty product similar to a life insurance policy

you would purchase for yourself, which covers all risks of associated death during the policy period. However, the major difference from your own life coverage

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