Pet insurance

Key points to remember

What is pet insurance?

Pet insurance means that your pet would be covered should it need medical treatment for an illness or injury. Depending on your policy, you may receive some or the whole amount of the vet’s bill.

Pet insurance can be viewed as a safe option against the unexpected and high costs of owning a pet. But not many people choose to get insurance, because of the price of the premium.

Whilst you do not need to insure your pet, you may be left with a very difficult decision to make if something unexpected happens and you aren’t covered.

How does pet insurance work?

When starting a new pet insurance policy, there is a waiting period before coverage actually begins. So coverage for accidents might start after a few days, whereas illness coverage might start after 2 weeks.

If your pet needs treatment during the waiting period, your policy will not cover you. Any issues that come up might also be considered a pre-existing condition in the future too.

Usually, you will be responsible to pay the vet bill upfront. You’ll then need to submit a receipt to your insurer to be reimbursed. Some insurers may pay your vet directly so you don’t have to spend much of your own money.

Coverage limits

A coverage limit is the most your policy will reimburse you for vet expenses in a year. You can usually choose the limit you like. If you spend more than the limit, you will need to cover the excess expense yourself.

Deductibles

This is the amount of the vet expense you will need to pay before you can be reimbursed. Note that if your pet’s treatment in a year is less than your deductible, you wouldn’t be reimbursed at all. As an example, your deductible is $300 and your dog needed $200 of treatment. Your insurer would not reimburse you for it.

Reimbursement

Where treatment exceeds the deductible, you still may not have full coverage for the vet bill. Most insurance policies have a reimbursement percentage that is best explained in the following example:

Your pet requires surgery and your policy has a $500 annual deductible with a 80% reimbursement percentage. Let’s say this is your first visit to the vet in the year. The surgery bill is $1,500. Your insurer will apply the reimbursement percentage first; they will deduct 20% of the bill that you are responsible for. That leaves a remaining vet bill of $1,200. Your $500 deductible would then be subtracted from this bill amount, leaving $700 that would be reimbursed to you.

If further treatment was needed during the current policy, then your insurer would cover 80% of the costs as your deductible has already been met.

What’s covered by pet insurance?

Pet insurance more often that not, falls into three types of plans:

Accident-only coverage	An accident-only plan will usually cover accidental injuries. It won’t cover treatment for cancer, infections or other illnesses. These policies tend to be cheap as the coverage is lower than other plans. Interestingly not all pet insurers will offer this type of plan. This plan is worth considering if the other two options are too expensive and you want some emergency cover for your pet. Also your pet’s age may mean they do not qualify for the other plans, so the accident-only plan becomes a suitable option.
Accident and illness coverage	This is a common plan among pet insurers. Cover would include accidents, plus other types of emergencies like broken bones, surgery, infections and illness. Note that specific treatment will have a coverage limit and won’t include preventive care like checkups or vaccinations. This type of plan provides coverage for the greatest range of problems your pet might have. You could customize the plan (to include checkups or vaccinations) so there are many options available to you.
Wellness plans	Wellness plans are usually an add-on to an accident and illness plan. It includes routine services or procedures that will have an annual limit for each. So costs may be covered for things like dental care, vaccinations, checkups or neutering / spaying. A wellness plan is worth considering if you know you’ll need most, if not all, services that it will cover. If not, you may pay for more than you get back.

What is not covered?

Pre-existing conditions

A pre-existing condition is a medical problem your pet had before starting a policy. Most, if not all insurers will not cover these.

Elective surgeries

Procedures such as ear cropping, tail docking or declawing are unlikely to be covered. But if the procedure is deemed necessary for medical reasons, it might be.

Routine and wellness checks

Most plans will not cover checks like annual vaccinations; spaying; neutering or teeth cleaning. It’s likely you need to pay for a wellness add-on to cover these checks.

Breeding

Usually expenses related to breeding or pregnancy are excluded from insurance plans.

Liability

If your pet injures someone or damages their property, most insurance plans will not cover you. But you may be covered through your homeowners or renters/tenants insurance policy. Such policies include personal liability coverage that may help if you are found responsible for harm or damage caused by your pet. Check with your insurer to understand more.

What impacts the cost of pet insurance?

When calculating your quote, an insurer will consider many factors about your pet. With all insurance policies, your quote will be based on how risky they perceive you to be and how likely you are to make a claim. As a basis, the following factors will be considered:

Current health and medical history. This can be the biggest impact on your insurance quote. Any pre-existing medical conditions will likely be excluded from cover.

Pet’s age. The older your pet is, the more likely it is to develop health problems. And so the more expensive insurance can be.

Breed. Insurance can be more expensive for specific breeds. This is because life expectancy, hereditary conditions or being susceptible to illnesses will vary.

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