Protecting Prancer: Dealing with deer insurance

Lori Johnston

Insuring Rudolph, Dasher, Dancer, Prancer and Vixen can be as difficult as Santa Claus trying to squeeze through your chimney on Christmas Eve.

Reindeer owners and deer farmers recognize the need to insure their deer, but obtaining affordable coverage can frustrate participants in one of the fastest-growing industries in rural America.

Deer farming is more than 100 years old in North America. The cervid farming industry, which includes deer and elk, has a direct annual economic impact of $893.5 million, according to researchers at Texas A&M University.

Deer-breeding farms spend an average of more than $2,600 a year on insurance.

An estimated 1.2 million white-tailed deer – the most widespread and abundant type of deer in the United States – are owned by deer farmers, with an average of 80 deer per farm, according to the North American Deer Farmers Association and the American Deer & Wildlife Alliance.

“They’re just like any other property or commodity. They’ve got value to them, the same as any other livestock. As a deer farmer myself, I’ve got insurance on my horses and my cattle and my deer,” says Shawn Schafer, executive director of the Ohio-based North American Deer Farmers Association.

If Grandma gets run over by a reindeer

Liability coverage is the least expensive part of an insurance policy for deer, and it can cover a variety of scenarios. One of the most worrisome: If a deer gets hit by a car and the tag on the deer can be traced to a farm, the owner might be liable for damages to the car and injuries to the driver or passengers.

“That’s the big concern across the country,” says Ryan Keith, co-owner of Mike Keith Insurance Inc. in Clinton, Mo.

The annual cost of wildlife damage to humans and property in the United States totals more than $2 billion annually, according to the U.S. Department of Agriculture.

The cost of deer coverage normally depends on the value of the animals. Typically, Schafer says, liability coverage should be 2 percent to 8 percent of the deer herd’s value. Deer-breeding farms spend an average of $2,637 a year on insurance, according to Texas A&M University researchers.

Mortality coverage, which compensates an owner in the loss of a deer because of injury or disease, is more expensive. For a farmer with $100,000 worth of deer, some mortality policies cost $10,000 to cover the deer herd for a year, Keith says.

Insuring antlered animals for liability and mortality requires understanding how insurers and government agencies categorize deer. Some consider them exotic animals, while others consider them livestock or wildlife.

‘It’s easier to insure Santa than it is a reindeer’

Kyle Wilson owns Tennessee-based Rocky Hill Reindeer, which has 16 reindeer that he exhibits at Christmas tree farms, theme parks, shopping centers, schools, museums, banks, towns and other places across the country.

“I’ve had three different (insurance) carriers,” Wilson says. “I didn’t anticipate it being as much of a pain in the butt as it is, but I’ve been able to get by.”

One insurance carrier canceled Wilson’s deer policy. The insurer cited increased risk from claims, even though Wilson says he didn’t make any claims. Another insurer required a few years later that he insure his farm and houses through the company — an option that Wilson didn’t take.

“It’s easier to insure Santa than it is a reindeer,” says Wilson, vice president of the Minnesota-based Reindeer Owners and Breeders Association.

Endearing yourself to an insurer

Kyle Wilson (wearing red-and-green hat) owns Tennessee-based Rocky Hill Reindeer, which has 16 reindeer that he exhibits around the country.

Deer owners often don’t understand that their farm policy or home policy won’t cover damage caused by deer because insurance companies do not view deer as livestock, but as exotic animals.

“A deer farmer who has a generic farm policy more than likely is missing liability insurance on his deer if they get out and they cause property damage or harm to others,” Keith says. His company is licensed in 22 states to offer coverage to deer farmers and hunting preserves; the coverage is endorsed by the North American Deer Farmers Association.

Some policies have become more restrictive and expensive as companies have experienced significant deer claims, Keith says. Adding to the challenge: Only a few companies offer coverage to deer farmers in every single state.

“There is no large-name company out there with this coverage. A lot of guys snuck in their deer farms under their farm policies,” Keith says.

Those farm policies are available through a state farm bureau, for example. Wilson says some deer owners he knows have turned to policies underwritten through specialty companies like Lloyd’s of London, which insures white-tailed deer and other domestic and exotic animals.

Keith says deer owners must tell an insurance agent and insurer carrier that they have deer on their farms and provide the number of deer. Some deer farmers have contacted his agency after receiving 30-day cancellations when the insurance carrier discovered deer were on the property.

“Just because your agent knows you have some deer out there, it doesn’t mean that the agent has told the company he writes for that you have deer out there,” Keith says. “Or agents are just making it look like a farm because they know it would be very difficult for you to have coverage for a deer farm.”

It’s a real zoo

When Wilson, the Tennessee businessman, rents reindeer to groups, the insurance doesn’t carry over when Wilson isn’t there. “I transfer the ownership, at least temporarily,” Wilson says. “When you lease a car, they don’t give you insurance, and I don’t either.”

Wilson, who’s trying to find an insurer that might offer a group policy to reindeer owners, has a petting-zoo policy through his insurer. The premium is based on income, instead of the value of the deer. In the past, he exhibited the reindeer rather than allowing kids and adults to touch the animals; getting insurance was one of the reasons he decided to operate as a petting zoo.

“If you say ‘petting zoo’ and they’ve done that and heard of that, it’s a little easier,” Wilson says of getting insurance.