Guide to Pet Insurance

While we consider them family members, owning a pet is expensive. A dog can cost as much as $55,000 over their lifetime. A cat can cost as much as $46,000.

Much of that expense goes toward vet care — from routine wellness exams to emergency surgeries, keeping a pet healthy adds up quickly. And the cost can be a significant source of stress. According to a study from Synchrony, even a $250 vet bill is enough to cause anxiety in most pet owners.

Increasingly, pet parents are turning toward pet insurance to help shoulder some of the financial burden. If you’re considering it, here’s what you need to know.

What Is Pet Insurance?

Pet insurance is a policy pet owners can purchase to help cover the cost of veterinary care. It works in a similar way to human health insurance — the policyholder pays a monthly or annual premium. In the event of an eligible claim, the insurance company pays a portion of the veterinary bill.

Policies can vary in cost and coverage and cover a variety of veterinary services for cats and dogs, including accidents, illnesses and routine care.

What Coverage Levels Are Available?

Pet insurance plans generally fall into three categories: accident-only, accident and illness plans, and routine wellness and preventative programs.

• Accident-only plan: Coverage is limited to accidents, such as broken bones, bites and ingesting foreign objects. This is usually the most affordable pet insurance, but provides limited coverage.
• Accident and illness plan: Covers accidents and illnesses like cancer, allergies and infections. This type of plan is more comprehensive but also more expensive.
• Routine wellness and preventative plan: Covers routine care, such as check-ups, vaccinations and preventative medicine. This type of plan is usually an add-on to an accident and illness plan and promotes preventive care to catch health issues early.

Want to compare rates? Use our Pet Insurance Comparison tool to see pet insurance plans from several insurance companies at once.

What Does Pet Insurance Cover?

Pet insurance can cover a variety of veterinary costs, including but not limited to:

• Hospitalization
• Surgery
• Diagnostic tests (X-rays, blood work)
• Prescription medications
• Emergency care
• Specialist visits
• Cancer treatments
• Alternative therapies (acupuncture, hydrotherapy)

What is (and isn’t covered) can vary widely by both types of plans and providers. While some providers may consider acupuncture a routine expense, others may exclude this as an elective procedure.

What Isn’t Covered?

Most pet insurance plans don’t cover pre-existing conditions. A pre-existing condition is any illness, injury or symptom that occurred before purchasing the pet insurance policy. Remember, an insurance company may also exclude breed-specific health issues, even if your pet hasn’t developed a problem. While this isn’t commonplace, it is a good idea to check with the insurance company if you have a breed prone to issues.

Other exclusions can include behavioral problems, elective procedures and cosmetic procedures. Each pet insurance company sets limits for cosmetic or elective procedures. Different plans can also impact your coverage levels. For example, spay and neuter surgeries are typically considered elective but may be covered under some comprehensive wellness plans.

How Does It Work?

Pet insurance works differently than your health insurance.

You'll need to choose a plan and enroll your pet to get pet insurance. Most pet insurance companies will require you to provide your pet's medical history and may require a veterinary exam before coverage begins.

If your pet needs veterinary care, you must pay for the services upfront and then file a claim with your insurance company. The company will review the claim and reimburse you for covered expenses. Some companies offer direct payment to the veterinarian, but this is rare.

Unlike your health coverage, you aren’t limited to seeing certain veterinarians or specialists. While your vet may have an insurance company they prefer, most insurers will reimburse any licensed vet.

When it comes to pet insurance, you’ve got options. Find your best rates with our Pet Insurance Comparison tool.

What’s the Deal With Reimbursement Coverage?

Unlike your health insurance, most pet insurance companies require the pet owner to pay for veterinary care upfront and then submit a claim for reimbursement. The reimbursement amount can vary depending on the policy, but it can be a percentage of the total veterinary bill or a set amount per incident.

That means you’ll still be on the hook for payment upfront — at least initially. Depending on the company, claims may be reimbursed within a few weeks to a few months.

How Do I Choose a Pet Insurance Company?

Pet insurance isn’t as regulated as your health insurance. To help ensure you find the best policy:

• Compare coverage levels: Consider the different coverage levels offered by each company and choose a plan that best suits the pet's needs.
• Exclusions: Look for exclusions and limitations within the policy, such as pre-existing conditions or breed-specific health issues.
• Discounts: Check if the pet insurance company offers any discounts, such as multiple pet discounts or discounts for paying annually.
• Premium rates: Compare the premium rates of different companies to find an affordable policy that fits within the budget.
• Customer reviews: Research customer reviews and ratings to understand the company’s reputation and customer service.

Ready to get started? Our Pet Insurance Comparison tool can help you quickly find quotes from several nationwide pet insurance companies at once — saving time and money.