What Is pet insurance?
Pet insurance is a type of health coverage that helps pay for veterinary care if your pet becomes sick or injured. It works much like human health insurance: you pay a monthly amount, and then when your pet needs veterinary care, the insurance company pays for some of that care, depending on your policy.
Why should I get health insurance for my pet?
Pet insurance gives you financial protection against unexpected veterinary bills, so you are not burdened with high costs during emergencies. Each year, one in three dogs and cats must visit the veterinarian due to illness or accident. Pet insurance coverage typically includes reimbursement for diagnostic tests, surgeries, medication, and hospitalization, making expert veterinary care more accessible and affordable.
What does pet health insurance cover?
Pet health insurance policies are primarily designed to cover accidents and illnesses. Comprehensive policies offer broad coverage for a variety of veterinary expenses, including accidents, illnesses, and sometimes preventive care. All claims on comprehensive policies are subject to pre-existing exclusions, deductibles, co-insurance, and sometimes an annual payout limit on eligible claims.
- Some companies offer additional coverage for routine vaccinations and other preventative care such as dental cleanings for an added fee.
- Some policies have other exclusions, such as grooming, bathing, and boarding.
- Some policies have bilateral exclusions, which means that if your pet requires ligament surgery on one knee, the other knee is automatically excluded for the same condition.
- Many policies have extended waiting periods before coverage begins for certain conditions (e.g., torn cruciate ligament).
Pet insurance may not cover previously diagnosed (pre-existing) conditions, like gastrointestinal obstruction, hip dysplasia or brachycephalic airway syndrome. For that reason, it is important to get pet insurance before your pet gets sick.
How does pet health insurance work?
Pet insurance is classified as property insurance, but it functions like health insurance. Most companies require you to file a claim after you visit the veterinarian. If you file online, rather than mailing in your claim, it can simplify and speed up the process. Some insurance companies allow the veterinarian to file claims electronically on your behalf, and the veterinarian will receive the payment directly from the insurance company.
Once a claim is received by the insurance company, the claims adjuster determines whether they have received all the information necessary to process the claim. If not, they will request additional information, including medical records. All companies aim to pay claims promptly, but incomplete claims can make the process longer. It is important to ensure you submit all necessary information when you file a claim.
Some important insurance terms to understand include:
- Premium: The amount you pay monthly or yearly for insurance.
- Deductible: The amount you pay before insurance begins reimbursing you. Deductibles may be annual or per-incident.
- Reimbursement Rate (Co-insurance or Co-pay): The percentage the insurer pays after you meet your deductible. Common rates are 70%, 80%, or 90%.
What factors affect premiums?
Pet insurance premiums may vary due to several factors, including:
- Age: Younger pets cost less to insure, because they are generally healthy and less prone to illness.
- Species: Rates differ for cats and dogs.
- Breed: Some breeds are more prone to certain medical conditions and diseases, which increases the premium. Some companies will not insure certain breeds.
- Your location: Different regions have different risk factors and veterinary costs, which affect premiums.
- Deductible: When you pay a higher deductible, your premium is lower.
- Other factors: Co-insurance and annual payout limits can sometimes lower your premiums.
How do I choose a policy?
There are many factors to consider when selecting a pet insurance policy, which makes the choice of insurance very personal. Some things to consider include:
Deductible amount: Sometimes you have control over this amount. The higher the deductible, the lower the monthly premium.
Deductible period: Sometimes the deductible is paid per year (you pay it every year regardless of the condition) or the deductible may be “per condition” (once you’ve paid the deductible for one ongoing condition you won’t have to pay it again for any medical expenses related to that condition). A per-condition deductible may have lower premiums.
Co-insurance amount: The more you contribute to costs, the less your premium will be. For example, if you select a 90% reimbursement, you will have a higher premium than if you select a 70% reimbursement.
Annual limits: Unlimited coverage will have higher premiums.
Decreased co-insurance with age or ongoing condition: Sometimes, as pets age or the costs for a chronic medical condition build up, insurance companies will change the co-insurance. It’s important to know if your insurance company does this, as it can result in unexpected increased personal cost for you.
Coverage for preventive care: If the insurance company offers wellness coverage, will it cover the full cost at your veterinary clinic or just an average cost? Does it cover what you consider important in your pet’s preventive care plan?
Coverage for integrative care: Not all policies cover things like rehabilitation, therapeutic laser, acupuncture, or other integrative procedures. If you are interested in providing these services for your pet, it is another consideration.
Will my premium increase as my pet ages?
Yes, premiums typically increase as your pet ages, because older pets have higher medical costs and become more costly to insure. However, with most companies, once a condition has been covered under a previous policy period, coverage for that condition is still covered after a policy renews.
Ask your veterinarian for pet insurance recommendations and be sure you understand in advance what you are buying. Pet insurance can provide you with great peace of mind by ensuring that, when your pet needs medical attention, you can focus on their health rather than the expense.
