Pet Insurance

Pet insurance is similar to people's insurance. You pay premiums to the insurer, who then covers your pet minus any co-pays, deductibles, and non-reimbursed costs. Pet insurance companies offer many different types of plans and prices. There are traditional plans where you can choose the veterinarian for services. Pet HMOs include a network of veterinarian members can choose from. Plus, there are discount clubs where for a fee you get a discount on veterinarian services, health, and grooming. In addition to basic health care coverage, other more specialized types of insurance - including pet life insurance, third-party pet liability insurance, and pet travel insurance are available.

Depending on your finances, and the type of pet you have, some of these plans may be worth checking out. Your veterinarian may have an insurance plan. Most pet insurance companies offer only dog, cat, and rabbit health insurance, though there are a few like Nationwide that will cover other pets as well, such as birds, rodents, reptiles, and exotic animals.

How Does Pet Insurance Work?

Many have age restrictions and will only insure pets from about 6 months old to 9 years of age. A few offer senior policies that cover older pets or lifetime policies that will stay with your pet all his life. Similar to people insurance, pet insurance policies have fine print. The fine print addresses various coverage levels, waiting periods for policies to take effect, exclusions (for pre-existing or congenital conditions), deductibles, payout caps per incident, per year, and per ailment. Read it all before you buy! With lifetime insurance policies you might not be able to change without significant financial penalties and costs. Talk to several pet insurance companies before you buy.

If you foresee the possibility of large expenditures for veterinary care for your pet and want to have financial peace of mind, then pet insurance may be just right for you. In cases of catastrophic accidents and illness, insurance can be a lifesaver for pets without draining owners financially. Because of advances in medicine and high-tech techniques such as MRI's, CAT scans, radiation therapy, specialized surgeries, and treatments costs of veterinary care are increasing. If your pet requires these treatments, the costs can quickly escalate into exorbitant amounts. Treatments for a single serious illness can be $5,000 alone. Any type of emergency after-hours treatment is likely to be extremely expensive.

Pet insurance is sold by companies directly selling their own insurance products. Often you will see that it is underwritten by another company, which means that another larger or parent company has determined the premium, and is assuming the risk.

Questions to Ask Before Purchasing Pet Insurance

  • Are congenital, hereditary, and pre-existing conditions covered?
  • Is 24-hour emergency care at clinics and hospitals covered?
  • What is the waiting period for coverage to take effect?
  • What are the policy deductible levels?
  • How much is the co-pay fee?
  • Will the insurer cover routine wellness care, such as vaccinations against diseases?
  • Are diagnostic tests, X-rays, blood work, lab fees, wellness visits, vaccinations, testing and treatment for heartworms, dental, eye care, and prescriptions covered?
  • Does the policy cover neutering or spaying costs, nail trimming, flea and tick control?
  • Will the insurer cover routine wellness care, such as vaccinations against diseases?
  • Can I pay for the policy on a monthly basis?
  • Is there a discount for insuring multiple pets?
  • Can I use my veterinarian or am I limited to the insurer's choice?
  • How long does it take for a claim to be processed?
  • Is there a lifetime limit on payouts and what are the annual caps on payment?
  • What are the caps for specific illnesses and specific incidents?

Pet Health Insurance

Most pet health insurance is the indemnity type. Your pet gets sick and you take him to the veterinarian. You pay the bill, submit it to the insurance company, and they send you a check after subtracting any deductible or co-pay. Some companies will pay your veterinarian directly after he bills the insurance company. Some companies offer an HMO style policy, or a discount plan that restricts you to a particular network of care providers who have agreed to be a part of the plan, similar to a preferred provider physician.

Expenses Covered

  • 24-hour emergency care clinics and hospitals
  • Routine office visits
  • Diagnostic tests for illness
  • Prescriptions (prescribed by veterinarian)
  • X-rays, blood work
  • Lab fees
  • Hospitalization (might be limits on how many days)

Conditions Covered

  • Sickness and fractures
  • Accidents, including ingestion of foreign objects, poisoning, cuts, and lacerations
  • Serious illnesses such as pneumonia, bone grafts, cancer, liver disease, and more

After a deductible and copay, basic standard plans usually cover emergencies, standard treatments, and major medical costs. These can be annual plans you pay for by the year or lifetime plans with annual premiums for the life of your pet. These policies cover only the most basic expenses. Premium plans cover more conditions and types of expenses than the basic insurance plans and can include riders that cover routine care, vaccinations, dental care, nail clipping, and sometimes grooming. They can also include extended care for elderly pets, medications, supplies, and free help lines.

Special plans are available for elderly pets, as well as those with special needs. Alternative plans offer a preferred provider or network style of coverage. You pay a fee and gain access to a listing or network of providers and suppliers who have agreed to discount their fees to card-carrying members.

Other Types of Pet Insurance

Life Insurance

This is exactly the same as people life insurance where a monthly or yearly premium is paid in exchange for receiving a lump sum of money on the death of your pet. There are variations and riders available, such as accidental death policies if your pet should meet with an untimely demise. Some of these policies include bereavement counseling for the pet owner, as losing a pet can be and often is as traumatic as the death of any other family member. Pet life insurance has not yet caught on to the extent that pet health insurance has, though it is getting easier to find.

Travel Insurance

Pet travel insurance is very limited. Some policies will cover unexpected expenses for pets associated with travel, with or without their owner. Read the fine print!

  • Emergency veterinary expenses while traveling might be covered.
  • Reimbursement for cancellation or postponement of trip expenses, if your pet is certified too ill to travel, or dies on vacation is possibly covered.
  • If the owner has to be hospitalized while traveling, it might include the cost of caring for your pet.
  • Accidental death or loss of pet coverage pays a preset amount if your pet dies, is lost, or stolen.
  • Reimbursement for fees if your pet is ill, or has died while on holiday, such as costs for disposal can be covered.
  • Replacement documents covers the costs of obtaining new papers for your pet if lost or stolen while on vacation.

Miscellaneous Pet Insurance

Third-Party liability insurance covers you for the cost of damage your pet causes to another person or property and is generally restricted to dogs. Legal riders (attachments) might pay your attorney fees if you must defend yourself in a lawsuit for damages caused by your pet.

Loss or theft insurance repays you the amount you paid for your pet. Advertising and reward insurance pays the cost of advertising your lost or stolen pet, as well as a reward to entice his return.

Kennel (or cattery) insurance pays fees if you have to be suddenly hospitalized for more than a specified period of time, usually a few days to a week.