Selling Horses and Insurance: Make the Most of the Cancellation Period When Selling
13 Oct 2025
8
Minutes
Katrin Straub
CEO at nextsure
Selling a horse is an emotional and complex process. To ensure that horse insurance doesn't become a stumbling block, you need to be aware of the legal deadlines and regulations. We will show you how to make the transition smooth.
The topic in brief and concise terms
After a horse sale, the insurance automatically transfers to the buyer (§ 95 VVG) and does not terminate.
The buyer and the insurer have a special right of termination within one month upon becoming aware of the situation.
The seller cannot cancel after the sale, but must immediately report the sale to the insurer.
Transfer of contract instead of termination: Understanding § 95 VVG
When you sell your horse, the insurance does not end but is transferred to the buyer by law. This regulation is found in Paragraph 95 of the Insurance Contract Act (VVG). The buyer takes over your existing rights and obligations from the insurance contract. This automatic transfer protects the new owner from an immediate coverage gap from day one. For you as the seller, this means that you cannot terminate the contract yourself. The policy continues seamlessly until one of the parties takes action. A robust equine insurance provides protection that the buyer might appreciate. This legal basis provides clarity for the approximately 1.3 million horses in Germany. The next step concerns the right to terminate, which now belongs to the buyer and the insurer.
The One-Month Window: Special Right of Termination for Buyers and Insurers
After the transfer of ownership, both the buyer and the insurance company have a special right to terminate the contract. This right is enshrined in Paragraph 96 of the German Insurance Contract Act (VVG) and is subject to a strict deadline. Both parties can terminate the contract within one month. The deadline for the buyer begins as soon as they become aware of the existence of the insurance. An example: The sale takes place on the first of May, but the buyer learns about the policy only on May 15th. Therefore, their termination deadline runs until June 15th. The insurer must also terminate within one month after becoming aware of the sale. Missing this deadline of just 30 days results in the continuation of the contract until the next regular termination date. A planned insurance change therefore requires prompt action. This deadline regulation ensures a swift decision and prevents months of uncertainty.
The Role of the Seller: Information Obligations and Liability Risks
Although you, as the seller, cannot terminate, you do have a crucial task: promptly notifying your insurance company of the sale. This notification should be done in writing and include the buyer's details. If you fail to do so, you risk sharing liability for the insurance premium. Specifically, this means the insurer can demand the premium for the current period from both you and the buyer. To avoid this, you should follow these three steps:
Inform your insurer in writing about the sale, ideally within three business days.
Provide the full name and address of the new owner.
Request written confirmation of receipt to have proof.
This proactive communication protects you from financial disadvantages and ensures a smooth transition. This lays the groundwork for the buyer's decision to retain or cancel the policy.
Buyer perspective: Take over policy or sign a new one?
The new horse owner faces a choice: take over the existing policy or exercise their special termination right. Taking over can be sensible if the terms of the old horse owner liability insurance are favourable. This saves a re-evaluation of the horse’s health, which can be an advantage worth several hundred euros for older animals with pre-existing conditions. Cancellation is advisable if the market offers better or cheaper deals. A modern tariff can often provide 10 to 15 per cent more performance for the same price. The decision depends on several factors:
Premium amount: Is the current premium competitive compared to new contracts?
Scope of coverage: Does the policy cover all the needs of the new owner, for example, riding participation?
Health condition: Could pre-existing conditions make a new contract more difficult or expensive?
Deductible: Does the agreed deductible align with the buyer's risk tolerance?
Analysing these four points helps the buyer make the right economic decision within the one-month period. Next, we highlight an often overlooked detail: premium payment during the transition phase.
Expert tip: Who pays the premium after the sale?
A common point of contention is the question of who pays the premium for the period after the sale until termination. The law clearly regulates this in Paragraph 95, Section 2 of the VVG: both the seller and the buyer are liable as joint debtors. This means the insurer can choose from whom to demand the payment. In practice, they will usually hold the original contracting party, i.e., the seller, responsible. You should therefore include a clause in the purchase agreement that governs the assumption of premiums from the day of transfer. Such an agreement protects you from an unexpected bill of up to €150 for a quarter. Without such an arrangement, you could be liable for at least one month's contribution. This clear contractual arrangement is an important cornerstone for a fair sales process.
Liability vs. Surgery Insurance: Are there differences in cancellation?
The legal regulations regarding transition and termination apply to property insurance, which includes animal insurance. Therefore, there is fundamentally no difference between a horse liability insurance and a horse surgery insurance. In both types of contracts, the policy transfers to the buyer, and both parties have the special one-month termination right. In practice, some insurers try to push the buyer into a new contract with another health check for surgical or health insurance. However, the legal basis is the transfer of the existing contract. As a buyer, insist on your right to take over the old contract under the existing conditions if this is advantageous for you. A good horse health insurance with no new waiting periods can be worth over 500 euros. Being aware of this legal situation greatly strengthens your negotiating position.
More useful links
The official platform Gesetze im Internet provides the complete text of § 96 of the Insurance Contract Act (VVG) of 2008, which governs the termination of insurance contracts.
The Consumer Advice Centre provides comprehensive explanations on when and how to terminate an insurance contract and what steps should be followed.
The German Equestrian Federation (FN) provides current statistics and facts on the subject of horses in Germany.
Statista offers detailed statistics on personal horse ownership in Germany based on survey data.
The Federal Ministry of Food and Agriculture (BMEL) provides official statistics on livestock in Germany, including current data on horses.
Finanztip explains various special termination rights, which can also be relevant in the context of insurance contracts, offering consumers important information.
FAQ
Can I, as a seller, cancel the horse insurance?
No, after the sale of the horse, the right to cancel transfers to the buyer. Your only responsibility is to report the sale to the insurer. Only the buyer or the insurer can terminate the policy within the month's period.
What happens if the buyer misses the cancellation deadline?
If the buyer misses the one-month notice period, the insurance contract continues for them. They can then only terminate it properly at the end of the contract term, which often means a commitment of up to a year.
Does the special right of termination also apply to a horse surgery insurance?
Yes, the provisions of sections 95 and 96 of the VVG apply to all animal insurances classified as property insurance. This includes horse liability, horse surgery, and horse health insurance.
Who pays the insurance when the horse is sold in the middle of the month?
By law, the seller and buyer are jointly liable for the premium of the current insurance period. It is therefore highly advisable to clearly stipulate in the purchase contract who will bear the costs from the date of transfer.
Does the buyer need to undergo a new medical examination?
When the buyer takes over the existing contract, no new health examination is required. This is a significant advantage for older horses or animals with pre-existing conditions. A health examination is only due when initiating a new contract.
How do I provide proof of sale to the insurance company?
The best way to prove the sale is with a copy of the purchase agreement. This should clearly indicate the buyer's name, the sale date, and the horse's details. A written notification containing this information is also sufficient.
