By Dr. Sarah Wallace

Pet insurance can play a huge role in keeping your pet health and your pet health costs in check. That’s assuming that you choose the best pet insurance for you and your pet. Where to start? Pet health care can be very expensive and, not unlike human health care, costs that are already hard to understand continue to climb.  Essentially, pet insurance covers a portion of veterinary medical costs. These can include everything from removing objects from your pup’s stomach (dogs eat everything!), to treating your cat’s allergies, to repairing your pet’s torn ACL.  So how do you choose the best pet insurance plan for you and your pet? Let’s start with the basics.

Pet Insurance Glossary

• Premium: The amount you pay on a monthly / annual basis to the insurance company for your pet to have insurance coverage. These can range from $10 to over $100 a month depending on your level of coverage.
• Deductible: The amount you pay out of pocket before insurance begins to cover expenses. This can be an annual deductible or a per-condition deductible. For example, if you have a $450 expense and a $200 deductible, you would pay the first $200 and the insurance company would help cover the remaining $250.
• Co-payment: The portion of the total cost (after the deductible) that you pay (the insurance company covers the rest). This can range from 10% to 40%, based on the insurance company and insurance plan. If you have insurance with a 20% copayment and have a $1,000 medical bill, you’d pay $200 of the cost. The insurer would pay $800.
• Maximum: This is the maximum amount the insurer will pay for medical care for your pet. This can be a per-condition maximum, annual maximum, or lifetime (of your pet) maximum.  If your policy’s annual maximum is $10,000 and you incur $12,000 of veterinary expenses for the year, you’d be responsible for the remaining $2,000. 
• Waiting period: Amount of time after you sign up for a policy before the insurer will cover medical expenses. This can be anywhere from 2 days to 30 days depending on the insurer.
• Pre-existing conditions: These are medical issues your pet has been diagnosed with prior to starting an insurance policy. Almost always these are excluded from coverage (the insurer will not pay claims related to these issues).

How Does Pet Insurance Work?

It’s relatively easy to sign up for pet insurance. You visit a pet insurer’s website, provide some basic information about your pet, and select a coverage plan. Insurers will determine the cost of your insurance by looking at your pet’s risk factors, which typically include: 

• Species (Dog or cat)
• Sex (Male of female)
• Breed
• Age
• Zipcode

These factors all determine how much you’ll pay for pet insurance because they potentially drive vet costs up or down.  Insurers ask for your zip code is because veterinary costs vary significantly based on location/ San Francisco, CA for example is a lot more expensive than Milwaukee, WI. 

After getting a pet insurance policy, you’ll pay a premium (typically monthly) to the insurer. When you incur a veterinary care expense that’s covered by your plan, you’ll pay for that  expense out-of-pocket, and then file a claim with your insurer to get reimbursed.  At this point, the insurer will request your pet’s prior veterinary records to determine if your pet has pre-existing conditions that may not be covered by your insurance policy.

What Is Covered &Amp; What Is Not?

Pet insurers vary widely in their coverage, so ALWAYS READ THE FINE PRINT. Generally though, insurers cover at least a portion of veterinary bills that are due to:

• Accidents
• Injuries
• Illnesses
• Surgeries
• Chronic conditions

What’s not on this list? Wellness care such as checkups, vaccines, flea, tick & heartworm medications, spaying, neutering and (in most cases) dental cleanings. Also, many insurers don’t cover exam fees or prescription diets. Finally, no insurer covers pre-existing conditions, elective procedures, grooming or boarding expenses. To help you start your research process, we’ve summarized key coverage differences across pet insurers in the table below.

How To Choose The Best Pet Insurance Plan?

There are a lot of options for pet insurance out there, and there is no one-size fits all solution.  Different insurers provide different types of coverage, expect to spend some time doing some research. Some things to consider when you first start evaluating insurance for your pet:

• Price: Compare multiple insurers. Similar coverage can have vastly different premiums depending on the insurer. We’ve seen price differences of up to 50% for the same policy!
• Coverage and exclusions. Keep your particular pet in mind and try to anticipate its particular needs. While a plan may have more exclusions than another, it may provide the coverage for what you actually need.
• Time to reimbursement.  Since most insurers reimburse you only after you submit a claim, you’re on the hook for the cost until this happens!