​ Everything You Want to Know About Health Insurance for Pets

 

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We think of our pets as children, so it only stands to reason that we want to give them the best possible care. Veterinary care can be expensive – it can cost hundreds, even thousands of dollars. Many pet owners struggle with how to pay for their pet’s medical care. During the average lifespan of a pet, a pet parent spends between $9,106 and $13,391 for veterinary care and medicines.¹ According to the American Kennel Club, routine vet visits cost between $700 and $1,500 per year, and that figure doesn’t include emergency care or prescription medications.²

To help estimate the potential cost of pet care, try our Breed Calculator.

Pet insurance is a way to help reduce those costs. In many cases it can also help with the typical costs of examinations, spaying and neutering, blood work and vaccines.

If you’re like most pet parents, you’ve got plenty of questions when it comes to pet insurance. Read on for answers to some of the most common pet insurance questions.

What Is Health Insurance for Pets?

Pet insurance is an insurance policy for your pet that will help reduce the cost of regular care as well as unexpected expensive veterinary bills. This coverage for your pet is similar to health insurance policies for humans. There may be an out-of-pocket deductible payment before a pet insurance plan pays a percentage of the covered procedures, and you will find that the cost of pet insurance and the specific coverage will vary based on the plan.

The thought of high medical expenses can be a real deterrent to pet ownership and expensive procedures and medications can sometimes lead to the heart-wrenching decision to put a pet down. Pet insurance is a great way to help with your pet’s veterinary bills and unexpected emergencies.

How Much Does Pet Insurance Cost?

With a human health care policy you will pay a monthly cost for coverage known as a “premium,” and the same is true with pet insurance. Many factors determine the price of that premium including but not limited to:

  1. The type of coverage

  2. The type of pet being insured

  3. The pet’s age

  4. Your geographical location

  5. The term or length of the policy

  6. The company that underwrites the insurance

The North American Pet Health Insurance Association (NAPHIA) reports that the average cost for dog insurance in the United States in 2019 was $585 per year and $349 for cat insurance. So for the cost of a cup of coffee a day, pet insurance gives you the peace of mind to allow your veterinarian to do whatever is necessary to protect your pet’s life.

How Does Health Insurance for Pets Work?

Pet insurance will not cover the full cost of any medical treatment, but most companies will reimburse up to 80 or 90% coverage on most procedures. In most cases, you must pay for the veterinary costs up front and the insurance company will reimburse you for the covered portion of those costs. However, pet insurance is also very simple: go to the vet, submit the invoice for the services to your insurance company, and receive your reimbursement according to your plan of coverage.

What Does Pet Insurance Cover?

Most providers will cover necessary veterinary surgeries, medication, diagnostic tests, prescription foods and supplements, and hospitalizations. Some pet insurance policies will cover wellness exams and vaccinations – others will not. That’s why it’s so important to understand the coverage terms and conditions of a pet insurance plan before you purchase it.

According to NAPHIA, there are three main types of pet insurance coverage:

  1. Accident & Illness (sometimes with embedded Wellness coverage) – This is more comprehensive coverage for veterinary treatment for unexpected injuries, sickness, disease and any changes to your pet’s normal healthy state.

  2. Accident Only – This is coverage for accident-related medical care.

  3. Wellness – This coverage is often offered as an endorsement add-on to your accident & illness or accident only plan. Some providers offer this coverage as a non-insurance subscription package. Wellness generally provides coverage for vaccinations, tests and dental cleanings. This type of protection is also sometimes called “Routine” or “Preventative” care. Some Accident & Illness plans may incorporate some form of Wellness coverage, such as dental benefits.

Is Health Insurance for Pets Worth It?

This is a question that only you can answer, but here is an example that could help you to make your decision. When you adopt a new dog, you’ll be facing some expensive costs during the first year. For instance, the dog will need a veterinary examination, the dog will need to be spayed or neutered, blood tests will be needed to test for general health and typical diseases, and vaccines will be needed. These costs add up to about $400 to $550. But if your dog incurs any other medical problems the costs would be even higher. So purchasing a dog insurance plan for your dog makes good financial sense.

A cat insurance policy makes sense for the same reasons. The cost of the cat insurance policy may be less than the cost of the ongoing veterinary care your cat will require, and you’ll be protecting yourself from any unforeseen emergency costs that could arise. Covering your cats while they are healthy will make sure that they are not later disqualified for coverage due to a pre-existing condition.

Average Initial Lifetime Pet Costs

The chart below shows the average initial and lifetime costs of owning a dog or a cat.³ This information will give you a better understanding of the financial commitments of pet ownership, and it will help demonstrate how pet insurance can be of value over the course of your pet’s lifetime.

This is a summary of the average cost of pet ownership, based on the average lifespan of a cat 15 and a dog at 12 years.

Dog

Cat

Initial

Lifetime

Initial

Lifetime

Adoption

$0 - $500

N/A

$0 - $200

N/A

Veterinary Care

$45 - $200

$540 - $2,400

$50 - $400

$750 - $6,000

Vaccinations

$60 - $150

$720 - $1,800

$60 - $150

$900 - $2,500

Spaying/
Neutering

$35 - $200

N/A

$0 - $200

N/A

Dental Care

$0 - $500

$0 - $7,500

$0 - $500

$0 - $7,500

Medications

$24 - $500

$288 - $7,500

$0 - $500

$0 - $7,500

Grooming

$0 - $1,200

$0 - $14,400

$0 - $300

$0 - $4,500

What Is the Best Pet Insurance?

There are many pet insurance plans out there to choose from, so how do you know if you’re getting the best pet insurance plan for you?

All pet insurance plans are not created equal. Some pet insurance plans will pay for things like wellness check-ups and vaccines while other plans will not. Some may exclude hereditary and congenital conditions common in popular breeds, or may not cover the veterinary office visit fee. It’s best to compare the policies to make sure that you’re getting the coverage you need at the best possible price. Also, why pay for features that you may not need?

In the end, the best pet insurance plan for you is the plan that offers the coverage you need, and one that fits within your budget.

Pet Insurance Glossary

Note: This glossary is provided here for educational purposes. Legal definitions may vary. For details, see our sample policies.

Premium – The annual or monthly cost of the insurance policy. This can vary greatly depending on where you live, and your pet’s breed, gender and age.

Pre-existing condition – Anything that relates in any way to your pet’s medical history before the policy started.

Waiting period – All policies have a medical exclusion period from the start of the policy that is referred to as a “waiting period”, which can range from about 10 to 30 days for accident and illness plans and sometimes shorter for accident only coverage. Claims can only be made for conditions that show symptoms or for accidents that occur after this date.

Chronic conditions – Ongoing illnesses or problems, like diabetes or cancer.

Coinsurance – This is the percentage that the policyholder must pay toward the cost of their insurance claim. The amount can vary among providers. The most common coverage will reimburse you for up to 80% of the amount you claim. The remaining 20% would be your coinsurance share.

Annual limits – This is a cap on the benefits your insurance company will pay in a year while your pet is enrolled in the pet insurance plan.

Deductible – This is the amount you pay for covered veterinary services before your insurance plan starts to pay. After you pay your deductible, you usually pay only a copayment or coinsurance for covered services.

Reimbursement – This is the amount a pet insurance company pays you for veterinary services. It is expressed as a percentage ranging from 60% to 100%. The most popular pet insurance plans have a reimbursement of 80% to 90% or your total vet bills.

Economic euthanasia – When pet parents have to make the difficult choice to put down a treatable dog or cat because they cannot afford to pay for the pet’s medical care

Sources:

1. AHI Animal Health Industry Report February 2018, retrieved from The Economic and Social Contributions of the Animal Health Industry, 2018 (http://healthyanimals.org/wp-content/uploads/AnimalHealthIndustryReport_AHI.pdf).

2. American Kennel Club. Retrieved from How Much Will You Spend On Your Dog In His Lifetime? (https://www.akc.org/expert-advice/lifestyle/how-much-spend-on-dog-in-lifetime/)

3. The Simple Dollar. Retrieved from Pet Ownership Cost Guide 2020 (https://www.thesimpledollar.com/save-money/pet-cost-calculator/)