Pet Insurance

Buying pet insurance is important, and we’re here for you every step of the way. Learn what to keep in mind when purchasing coverage to protect your pet.

Elissa

By

Elissa Suh

Elissa Suh

Personal Finance Editor

Elissa Suh is a senior editor of estate planning at Policygenius in New York City. She has researched and written extensively about wills, trusts, and personal finance since 2019, with an eye towards making difficult (and at times gloomy) topics easy to understand for readers. Her articles and data stories has been cited by the likes of MarketWatch, CNBC, PBS, Inverse, The Philadelphia Inquirer, and more.

Published May 14, 2021|5 min read

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What is pet insurance?

Pet insurance is like health insurance for your pet. When something bad and unexpected happens to your beloved cat or dog, pet insurance reimburses you for covered expenses like vet bills. Getting pet insurance can help you save on veterinary costs, and it can provide peace of mind when it comes to your pet's health and your budget.

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How does pet insurance work?

Here’s an outline of what you do when when you have insurance and your pet needs medical attention:

  1. Go to any licensed veterinarian. Pet insurance doesn't require you to stick to a network.

  2. Pay the vet upfront. Unlike health insurance, the vet doesn't bill the insurance company for the costs. 

  3. Submit a claim (a simple form and invoice from your vet) to the pet insurance company.

  4. Wait on the decision. If you've been a careful shopper and read through the policy, you shouldn’t be too surprised by what happens.

  5. Get paid by direct deposit or mail.

Pet insurance doesn’t pay you back for all the money you spent on vet costs though. How much you’re reimbursed will depend on a few key features of your policy.  

Reimbursement rate

This is the rate at which the insurance company covers eligible expenses. Most pet insurance policies have reimbursement rates that range from 70-90%. Plans with higher reimbursement rates will cost you more in terms of monthly premium. For example, If you have a claim for $2,000 and your reimbursement rate is 80% you can expect to get back $1,600. 

Deductibles

Before your pet insurance coverage applies, you’ll first have to pay a specific amount of money on your own, called the deductible. You’re probably familiar with deductibles from other types of insurance (like health insurance or car insurance). 

Let’s say you have a $200 pet deductible. Using the example above, for a $2,000 bill you’ll have to pay $200 out of pocket, and then the pet insurer will reimburse you for $1,440 (80% of the remaining $1,800). 

Your pet insurance policy may have an annual deductible, or a per-incident deductible, which means you’ll be responsible for paying the deductible again for every incident that requires veterinary care.

Limits on payouts

Some policies will limit the amount paid in claims for your pet, which means the insurance company will stop paying you back after they’ve reimbursed you for a certain dollar amount. There are also plans with no limits on payouts, which are still reasonably priced and can provide the greatest peace of mind. 

Generally, there are five different types of payout limits you may encounter with pet insurance:

  • Per incident – A maximum amount for each separate illness or injury. The limits can go up to $7,000.

  • Per year – The maximum amount for each twelve-month period on your policy. The limits can go up to $20,000.

  • Per lifetime – The maximum amount the insurance company will pay during the lifetime of your pet. Limits can go up to $200,000.

  • Per body system The maximum amount the insurance company will reimburse for a body system, like digestive system, musculoskeletal system, and nervous system.

  • Per schedule of benefits – A maximum based on a listing of allowances for specific health conditions. For example, a maximum allowance for asthma of $500 per year. 

The cost of pet insurance

Part of having pet insurance coverage is paying the monthly premium. You must keep paying this recurring cost or else your coverage will terminate (or “lapse,” in insurance terms).

The average monthly costs of pet insurance [1] can range from:

  • $11 to $30 for cat insurance

  • $18 to $50 for dog insurance

The premiums are determined by a few factors, including:

  • Species: Cats cost less than dogs, and smaller pets are cheaper to insure than larger ones

  • Breed: A pet that’s susceptible to certain diseases will warrant a higher premium.

  • Age: Older pets are more expensive to insure than younger ones.

  • Location: Insurance often costs more in larger or more expensive cities

The premium is also affected by policy features — like the deductible and reimbursement rate we mentioned above — as well as the type of coverage you get. A more robust plan that covers more health expenses for your pet will cost more than one that doesn’t.

Learn more about how much pet insurance costs and how to save on premiums.

Types of pet plans & what’s covered

Pet insurance policies can be divided into three types: accident and illness plans, accident-only plans, and wellness plans. The first two are pretty self-explanatory: one covers your pet if they get sick (vomiting or diarrhea, for example) or injured in an accident (like getting hit by a car); the other covers only the latter. A comprehensive accident and illness plan will cost more, but it’ll protect your wallet and pet under many more circumstances.

Depending on the insurance company, you may be able to combine either type of coverage with a wellness plan, which can cover your pet’s preventive care, like routine screenings, vaccinations, and even dental cleanings.

AccidentComprehensiveWellness
Accidental injuriesYesYesNo
Diseases and illnessesNoYesNo
Chronic conditions and cancerNoYesNo
Pre-existing conditionsNoNoNo
Routine careNoNoYes

Some insurers may cover additional services not listed above, like behavioral services and alternative therapies. 

Learn more about what pet insurance does and doesn’t cover.

Why trust Policygenius?

Our track record. From coast to coast, we’ve helped over 30 million people shop for insurance, and protected our customers with over $60 billion in coverage.

We’ve vetted the top policies. Policygenius puts the best dog and cat insurance options in one place. Every policy has been personally chosen by our experts, because we’re pet owners too. 

Real human help. Our licensed advisors deal with the insurer so you don’t have to. No AI bots, no robocalls, no salespeople. Just real human help from start to finish.

FAQs about pet insurance

How do I know which vets accept pet insurance?

You don't have to worry about this! With pet insurance, you can go to any licensed veterinarian. You pay the vet for their services (as you normally would), then submit that bill with a claim form to the insurance company. Any reimbursement you're eligible for will be paid directly to you by the insurer.

This is different from human health insurance, where the insurance company pays the doctor directly (not you). That's why for human health insurance, you need to confirm whether your doctor works with a particular insurance company. 

Why doesn't pet insurance cover pre-existing conditions?

Anything that is documented on your pet's medical health record before you get pet insurance will likely be considered a pre-existing condition and will be excluded from coverage (meaning any claim you make on that condition will be denied).

An insurance system that covers pre-existing conditions couldn't last for very long: that would allow pet owners to wait until something happens before they get insurance — and then cancel it after they recover. If everybody did that, no insurance company could afford to exist! 

Because pre-existing conditions are always excluded, you should get pet insurance as soon as possible for your pet. The longer you wait, the greater the chance your pet experiences a health issue that would be excluded from coverage.

Isn’t pet insurance a scam?

At Policygenius, we offer only products we believe in, and would buy for ourselves. And that applies to pet insurance. A lot of people think pet insurance is a 'scam' if you don't get back more money than you pay in for it. That's the wrong way to think about pet insurance (and any insurance for that matter). Pet insurance is about having a safety net in the event of major and unpredictable health expenses for your furry best friend.

Want to know more? We talked to Vox magazine about pet insurance and why it's not a ripoff.