Su Guillory Business and Finance Expert

What Is Pet Insurance?

Pet insurance is a health insurance policy for pets. There are a few types of policies, including:

• Accident-only plans
• Accident and illness policies
• Wellness plans
• Lifetime plans

Each plan has benefits and drawbacks, so consider your pet's health needs, breed, and your budget when choosing coverage. The best pet insurance allows policyholders to customize annual coverage, reimbursement percentages, and deductibles. 

How Do I Choose a Good Pet Insurance Company?

Some pet insurance companies offer a wide range of plans, while others focus on a particular type of policy.

Wendy Hauser, DVM and veterinary advisor at ASPCA Pet Health Insurance, says: “I recommend pet owners understand different choices for percentage reimbursement, deductible levels, if there are any waiting periods, and if there are any annual or per-incident maximums. 

"Additionally," she notes, "pet owners should review sample policies on the website to understand what is covered and what is excluded. Comparison tools help to highlight how provider coverage differs.”

Customize a plan for your pet today

Spot Pet Insurance VISIT SITE

How to Choose the Best Pet Insurance Plan Type

To choose the best pet insurance plan, match your pet's needs with the plan type. Younger pets may need wellness services, while older pets may need accident and illness coverage. Consider these questions when shopping for a policy:

• What are my monthly premiums?

• Will my premium increase each year? How is the increase determined?

• Is pet wellness or dental coverage included? Is there an extra fee?

• Can I file a claim using my smartphone?

• How are pre-existing conditions defined?

• What is/isn’t covered?

• Are there waiting periods?

• Are there plan discounts, including multi-pet discounts?

Find the Coverage Level You're Comfortable With

A high deductible policy will cost less, but you'll have higher expenses the first time you use your policy. If your budget allows, consider a lower deductible.

Check the Pet Insurance Waiting Periods

Most companies have waiting periods before coverage activates. For accidents and illness, it’s usually 14 days or less. For other services, like cruciate ligaments, the waiting period may be longer, such as six months.

Pet Insurance Discounts

Check for multi-pet, military, spay/neuter, annual payment, and bundling discounts.

Do a Quote Comparison

Get a quote from multiple carriers for the same amount of coverage and deductible, then compare. You may find one cheaper than another, but look at the fine print to make sure you know precisely what you're purchasing.

How Much Does Pet Insurance Cost?

The cost of pet insurance depends on the pet's age, medical history, and coverage type. On average, expect to pay between $40 and $70 a month.

How Pet Insurance Costs Are Determined

The best pet insurance companies understand that no two pets’ needs are the same. Here are some of the criteria used to calculate costs:

Annual Maximum, Deductible, and Reimbursement Level

Pet insurance costs are primarily determined by three things:

1. Annual maximum coverage: The higher the maximum, the higher the premium.

2. Reimbursement Level: Options typically range from 70% to 90% but can go lower and higher.

3. Deductible: Normally anywhere from $50 to $1,000. The higher the deductible, the lower your monthly premium.

Pet's Age

Pet insurance for a puppy or kitten will likely cost less. Over time, your monthly premium may increase as your pet ages and becomes more likely to have health issues.

Pet's Breed

In addition to your pet’s age and weight, the insurer may also look at its breed to calculate your premium. Some breeds are more prone to hereditary and congenital health problems and present more risk to the insurer.

Most Expensive Dog Breeds to Insure

Here are a few dog breeds that may cost more to get pet insurance for: 

• Cane Corso

• French Bulldog

• Mastiff

• Newfoundland

• Rottweiler

• Saint Bernard

Most Expensive Cat Breeds to Insure

When it comes to cats, these breeds will cost more to insure:

• Sphynx

• Himalayan

• Persian

• British Shorthair

• Maine Coon

Pet's Gender

Sometimes one gender of animal is more likely to develop certain illnesses or diseases, or even engage in riskier behavior that might cause accidents and injury.

Your Location

Because veterinarian costs vary depending on location, so can your pet insurance premium. Areas where vets charge more may have higher pet insurance rates to cover those costs.

Flexible plans, 24/7 healthline

Embrace VISIT SITE

What Does Pet Insurance Cover?

Coverage varies by company but generally includes accidents, illnesses, diagnostics, dental illnesses, hospitalization, cancer, prescriptions, hip dysplasia, and, in some cases, alternative treatments.

What Doesn't Pet Insurance Cover?

Most carriers don't cover pre-existing conditions, spaying/neutering, flea and heartworm prevention, dental cleaning, grooming, wellness visits, or prescription food. Some policies cover euthanasia, funeral costs, and behavioral treatments, but most do not. Elective procedures like tail docking and declawing are usually excluded.

How Does Pet Health Insurance Work?

Pet insurance usually works on a reimbursement basis. This means you pay the vet upfront, then file a claim to get reimbursed for eligible expenses. Some companies partner with vets to pay them directly, so you only cover the costs that aren't eligible.

Exclusions

There may be exclusions for age or breed, and many won't cover pre-existing conditions.

Waiting Periods

Even the best companies have waiting periods for accidents and illness, usually up to two weeks. For cruciate ligaments, it may be six months, though some insurers waive this with a vet’s note.

Veterinarian Restrictions

When shopping for the best pet insurance, see if your preferred vet is one you can visit with your policy.

Is Pet Insurance Worth It?

It depends on your pet's needs and your budget. Pet insurance can provide peace of mind and access to better care, but costs and coverage details must be evaluated carefully.

How to Buy a Pet Insurance Plan

When you buy a pet insurance policy, you'll pick an annual limit, deductible, and reimbursement percentage. These choices help determine your premium and the maximum amount you can get back yearly.

Recent Trends: Increases in Pet Health Problems

The past five years have seen significant changes in the pet health industry. According to a recent study, nearly a quarter of pet owners reported increased pet care costs in the past year, driven by inflation, higher veterinary staff wages, and the high cost of new medications. Additionally, over a third of pet owners said it would be financially challenging to pay for a minor operation for their pet. 

These factors have led to increased demand for pet insurance and higher premiums, up to 20% in the last year. It's crucial for pet owners to research, compare policies, and consider the costs of pet insurance so that they're not taken advantage of.

It's worth bearing in mind that a 2022 MarketWatch Guides Team study found that 99.5% of pet owners who bought pet insurance did not regret it.

Bottom Line: The Policy Should Fit the Pet

Pet insurance can provide financial support should your pet need costly exams or treatments. If you decide that pet insurance is right for you, know that not all pet insurance companies are identical, nor are policies identical. Know what you and your pet need in a policy and then compare providers to find the best policy.

PetsBest 30-day money-back guarantee is not available in NY or PA.

* Plan costs vary based on plan type, pet breed, age, and location. Prices are rounded up to the nearest whole USD.

Written by Su Guillory

Su Guillory is a freelance business writer and expat coach. She’s written several business books and has been published on sites including Forbes, Nav, SoFi, and AllBusiness. She writes about business and personal credit, insurance, loans, and credit cards.