What Is Pet Insurance?

Learn Whether to Get Pet Insurance For Your Beloved Pet

Close-Up Of Dog And Cat Looking Away Over Black Background
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 Derrick Ferrer/ EyeEm/ Getty Images

If you’re like most pet owners, you’d do anything for your animal when they’re sick. But veterinary bills can add up quickly, especially if your pet requires emergency care or treatment for a chronic illness. One way to plan for these costs is to buy pet insurance. It’s not cheap, but it can pay for itself if your animal companion ends up needing expensive care.

Pet insurance is health insurance for your pet. It can help cover vet bills when your animal gets sick or hurt, and more comprehensive plans include preventive care. Pet insurance is geared toward dogs and cats, so coverage is less commonly available for other types of animals.

How Does Pet Insurance Work?

There are two types of coverage offered by pet insurance plans: accident only or accident and illness. The vast majority of pet owners go for the latter. This is different from pet liability coverage on home and renters insurance, which pays for legal expenses, bodily injury to others, and property damages caused by your pet.

Like health insurance plans for humans, you’ll find pet insurance plans have deductibles, copayments, maximum annual and lifetime payouts, and waiting periods. Also typical are coverage exclusions for pets younger than 8 weeks and older than 12 years, as well as those with pre-existing conditions.

Exact coverages and limits vary by insurer. For instance, some plans have no annual or lifetime limits in place, while others let you choose lower limits for a more affordable premium. Some insurers also allow you to select veterinarians and clinics of your choice, while others require the use of in-network ones.

You generally pay for vet visits out-of-pocket and then submit a covered claim for reimbursement. Some pet insurers can pay your vet directly, but there may be upfront work involved on your part or the vet’s, and there may be limitations on when the service can be used. It’s best to ask your pet insurance company about their reimbursement options.

What Does Pet Insurance Cover?

Accident-only policies cover mishaps and unexpected injuries like sprains, toxin ingestion, and lacerations. An accident and illness policy extends coverage to diseases, sicknesses, and diagnostic treatments, and may include:

  • Congenital or hereditary conditions
  • Cancer treatment
  • Dental procedures
  • Cost of prescription foods
  • Medical advice
  • Medical equipment
  • Physical therapy
  • Prescription drugs
  • Supplements
  • Surgical procedures

Depending on the insurer, annual deductibles typically range from $0 to $1,000 and annual limits may be as low as $2,500, or unlimited. Deductibles are covered pet health expenses you must pay before insurance coverage kicks in, while annual limits are the maximum yearly reimbursement amounts from your pet insurer.

Some insurers also offer wellness and preventive coverages, usually as add-ons for an additional premium. They may include services such as:

  • Blood tests
  • Dental cleaning
  • Deworming
  • Preventive flea and heartworm medications
  • Genetic certification
  • Heartworm tests
  • Microchipping
  • Radiographs
  • Screens
  • Spaying or neutering
  • Urinalysis
  • Vaccinations
  • Wellness exams

What Is Not Covered by Pet Insurance?

Most pet insurance companies don’t cover pre-existing conditions, and some may even exclude certain conditions when you renew your policy if they were treated or diagnosed in a prior coverage period.

Also, typically excluded from basic pet insurance is much of what you would find under optional wellness and preventive coverages, plus:

  • Boarding or accommodations
  • Conditions or accidents arising within waiting periods
  • Non-standard experimental or investigative treatments
  • Over-the-counter food and supplies
  • Transportation

It’s common for there to be a waiting period after signing up for pet insurance of about two weeks for accidents and illnesses. Issues that come up during this time are often treated as pre-existing and excluded from coverage.

Some pet insurance companies don’t completely cover bilateral conditions (medical issues happening on both sides of the body). For instance, if your pet has hip dysplasia on one side as a pre-existing condition and then develops it on the other side while insured, your pet insurance may not cover the treatment for the side that developed the dysplasia most recently. Even when both sides develop the condition while insured, your insurer may only pay for treatment on one side.

Excluded treatments can also vary by breed. This is especially true for breed-specific hereditary conditions. Be sure to read the policy’s fine print and ask questions before you sign up, so you know you have the coverage you expect.

Is Pet Insurance Worth It?

Based on average expenses, a pet emergency room visit that includes an initial consultation, general bloodwork, X-rays, and surgery, could cost up to $3,600 for cats and $5,600 for dogs. Cancer treatments can cost upwards of $10,000. But an accident and illness policy may be able to cover some or all of these costs for a fraction of the price. Here’s an idea of what insurance can cost with popular pet insurance companies:

Pet Insurance Premium (Monthly)
Company 2-Year Old Dog 8-Year Old Dog 2-Year Old Cat 8-Year Old Cat
ASPCA Pet Health Insurance $45.82 $91.64 $19.74 $32.90
Nationwide $35.34 $98.61 $17.16 $37.40
Petplan $42.28 $137.05 $20.16 $38.90
Pets Best Insurance $27.61 $65.80 $11.52 $27.47
Figo Pet Insurance $30.63 $78.37 $16.73 $33.19

Your pricing may vary based on factors like your pet’s:

  • Age
  • Breed
  • Coverages, deductibles, and limits
  • Gender
  • Geographic location
  • Species

Tip: You may be able to save on policies with discounts like multi-pet, military, employee benefits, spay/neuter, predictive testing, and pay-in-full.

Should I Get Pet Insurance?

Pet insurance is a great fit for pet parents who prefer a monthly premium to large out of pocket expenses, for those with multiple pets, and for owners who aren’t prepared to pay unexpected vet bills.

But the premiums can add up. For an older dog, our research shows you could pay more than $1,600 a year. For those who don’t want or can’t afford pet insurance, alternatives like credit financing, setting up a pet savings fund, financial assistance programs, and discount programs (such as Pet Assure) can make veterinary expenses more palatable.

Methodology

We used Labrador Retrievers and Ragdolls—America’s most popular dog and cat breed—as our fictional pets when comparing. The basic accident and illness policies we compared were from Illinois and had annual deductibles of $500, yearly limits of $5,000, and reimbursement levels of 80%.

Article Sources

  1. NAIC. "A Regulator's Guide to Pet Insurance." Accessed Oct. 12, 2020.

  2. Insurance Information Institute. "What Is Covered By Standard Homeowner's Insurance?" Accessed Oct.12, 2020.

  3. PetFirst Pet Insurance. "Why the Fine Print in Your Pet Insurance Plan Matters." Accessed Oct. 12, 2020.

  4. Mass.gov. "Pet Insurance." Accessed Oct. 12, 2020.

  5. Emergency Vets USA. "Average Cost of Emergency Vet Visits." Accessed Oct. 12, 2020.

  6. Cornell University College of Veterinary Medicine. "Cancer Management - Frequently Asked Questions." Accessed Oct. 12, 2020.

  7. AKC. "Most Popular Breeds." Accessed Oct. 12, 2020.