Pet Insurance Basics
- Mary Malucci
- May 5, 2023
- 4 min read
Updated: Dec 24, 2024
Until recently, the mantra in veterinary medicine has been "There is no such thing as pet insurance". The insurance companies heard us and now there are dozens of companies that offer pet insurance, primarily for cats and dogs.
Before you get bogged down comparing figures from several different companies, it may be a good idea to determine what you need from a pet insurance policy.
There are three basic categories of pet insurance currently being offered. Accident Only policies tend to be the least expensive because they are limited to covering injuries resulting from accidents, like being hit by a car. Read the details of the policy carefully to ensure that services like hospitalization, exam fees and medications are covered in addition to the injury repair.
Accident and Illness policies cover acute illness as well as accidental injury. Coverage for illness should include diagnostic tests and appropriate treatments. Many breeds of dogs are predisposed to certain hereditary or congenital conditions. If you own such a breed, make sure the insurance policy covers those conditions. As with human health insurance, most companies will not cover "pre-existing conditions".
Wellness or Preventative Care policies are usually add-ons to the primary Accident Only or Accident and Illness plans. These can cover routine services like exams, vaccines, spaying or neutering and grooming. Unfortunately, most wellness plans do not cover routine dentals. However, extractions secondary to traumatic injury can be covered under accident plans. Also, not all companies offer wellness plans.
Of the 24 companies reviewed in the US News article, only one offered insurance for exotic pets. Nationwide offers an Avian and Exotic Pet Policy that covers accidents, illness and some preventative care. ASPCA Pet Health Insurance is the only company that offers policies for horses.
Premiums, paid monthly, are determined by several factors. Dog insurance plans tend to be more expensive than cat plans, especially for dog breeds with known disease predispositions. A pet's age influences premiums based on the level of care needed at different life stages. Wellness policies for puppies and kittens will be more expensive than a similar plan for an adult cat or dog. By the same reasoning, plans for elderly pets are usually more expensive and sometimes premiums will go up as the pet ages. Many companies set an age limit, usually 14 years, and refuse to start policies on pets of that age. Where the pet (and owner) lives, the pet's general health and the level of coverage you want also affect the cost.
Deductibles determine how much an owner must pay out of pocket before the insurance company will start coverage. Annual deductibles must be paid every year. Per-condition deductibles apply to one condition at a time. Once that deductible is paid for that condition, the insurer covers continuing care for that condition according to the plan purchased. The deductible only needs to be paid again if the pet is diagnosed and treated for a different condition.
Reimbursement Rates represent the amount of your vet bills that the insurance company will reimburse to you after the deductible is met. These levels range from 50-100%. Lower reimbursement rates will lower your premiums but increase your out-of-pocket spending.
Some companies place an annual limit on the amount of money they will reimburse over a year. If you exceed that limit, further expenses will not be covered for the rest of the year.
Some companies allow policy buyers to customize their premiums, tailoring their insurance plan to best meet the pet's needs. Other companies offer discounts, especially if you have other policies with that company.
Most insurance companies require the Owner to pay for veterinary care at the time of service and submit a claim for reimbursement. Before reimbursing the Owner according to their policy, the insurance company will review the pet's medical records to see if the claim meets the requirements for coverage. If there are any notes indicating the pet was seen for anything related to the condition stated on the claim, coverage may be denied due to an indication of pre-existing disease.
Trupanion is the only company I know of who handles claims like they do in human medicine. The Owner makes their co-payment at the time of service and the vet clinic immediately submits the claim. Trupanion has accomplished this by collaborating with EzyVet, a popular veterinary management software. Once they determine how much Trupanion is covering, they pay the clinic and send the Owner an invoice for the balance, if necessary. Trupanion also allows Owners to submit an estimate for planned surgery ahead of time to get approval for coverage before surgery.
All insurance companies have a waiting period between the purchase of the policy and the time it goes into effect, anywhere from 10-15 days to 6 months. Any disease diagnosed during the waiting period will be considered a pre-existing condition. It's better to have an insurance policy in place before you need it. Trupanion has an Exam Day offer which activates a newly purchased policy within 24 hours and provides 30 days of coverage at no charge. If the Owner wants to convert to a full policy at the 30-day mark, they can. If they choose not to buy the policy, it will be canceled due to non-payment of premium.
When contemplating the expense of providing good quality veterinary care to our pets, especially in a crisis, the support of an insurance policy may be the difference between treating your pet or not.
If you are serious about acquiring pet insurance for your loved one, you will need to do some research. I recommend the following articles for insights into different companies and what they offer.
US News and World Report "Best Pet Insurance Companies of 2023"
Forbes "Best Pet Insurance in Virginia of 2023"
MarketWatch "7 Best Pet Insurance Companies in Virginia 2023"
Money Geek "Pet Insurance in Virginia: Compare the Best Pet Insurance Companies and Most Affordable Quotes."
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