Pet Insurance

This is the fifth of a five-post client information series Brownsburg Animal Clinic is offering on pet insurance—part of our Pet Care Costs collection of posts and pages to help you manage the costs of pet ownership more effectively. As they describe step-by-step processes, we suggest you read the Pet Insurance posts in order from first to fifth.

If you’ve read our four previous posts about pet insurance and remain unsure if it’s for you, we’re guessing you may have become overwhelmed and abandoned our suggested purchase process somewhere along the way. 

As we’ve noted before, choosing pet insurance is a complex purchase decision. Unfortunately, there are few if any shortcuts for a pet owner who wants to make a well-informed choice of coverage for a cherished pet. 

Maybe the complexity of the purchase is part of the reason why only 2-3% of American pets are insured. 

Other reasons reported by pet owners who haven’t bought pet insurance include thinking it’s too expensive, thinking it’s not worth the money, not knowing what it covers or never having heard of pet insurance in the first place.

The best reason not to buy pet insurance is knowing you can easily afford to pay any vet bill that may come your way for the rest of your pet’s life—even bills totaling tens of thousands of dollars. 

So who buys pet insurance? 

According to its “State of the Industry Report 2023,” the North American Pet Health Insurance Association (NAPHIA), California leads the way in insuring pets with 18.6% of pets covered as of year-end 2022, followed by New York at 7% and Florida at 6.2%. 

But in Indiana, only 1.3% of pets had insurance coverage at the end of 2022. 

NAPHIA reports most insured pets in the USA are dogs, accounting for 80.1% of the total in 2022. Insured cats’ market share has been growing every year since 2017, with an increase of 19% in 2022, bringing them to 19.9% of all insured pets at year-end.

BBVA, a global wealth management concern based in Switzerland, identifies Sweden as the country with the highest number of insured pets—80%. In the United Kingdom, 30% of pets have insurance. In Spain, fewer than 5%.

Petkeen.com says about 7% of pets in Australia are insured.

Clearly, apart from the Swedes, most pet owners throughout the world elect not to insure their pets. As veterinarians who deal every day with clients who tell us they can’t afford the care we offer, we think that’s a shame. 

Although we’ve elected not to recommend specific policies and companies, we do believe most our our clients would benefit from insuring their pets, and most of our patients would benefit from being insured. If you’re still wondering if pet insurance is for you, read on.

Why Buy Pet Insurance At All?

To address any misgivings you may still have about buying insurance for your pet, we suggest you consider why you became at least mildly interested in buying pet insurance in the first place. 

If you’re like most pet insurance shoppers, your primary motive for buying a policy is to reduce the impact of financial considerations on major, possibly urgent, life-and-death veterinary care decisions you may face in the future impacting the pet you love.

Whether it’s helping pay for expensive emergency surgery or ongoing, lifelong management of a newly-diagnosed chronic condition, a well-chosen pet insurance policy frees you to choose the best treatment options for your pet without having money—or the lack of it—limit your choices or, at worst, resort to “economic euthanasia” because you simply can’t afford to treat your ill or injured pet. 

A sound policy from a reputable insurer with well-chosen policy options lets you enjoy the peace of mind that comes with knowing the impact of unexpected, potentially sizable vet bills on your finances will be manageable. You know you’ll be able to provide what’s best for your pet as well as what’s best for your bank accounts.

So Is Pet Insurance Really for You?

In his book, Pet Health Insurance: A Veterinarian’s Perspective, Dr. Doug Kenney asks two questions that together, can help you decide if pet insurance is for you.

• How much would you be willing to spend to save your pet’s life if there is a reasonable chance of recovery and a good quality of life after treatment?
• How much would you be able to spend to save your pet’s life if there is a reasonable chance of recovery and a good quality of life after treatment?

If you’d be willing to spend more than you are able, Dr. Kenney writes, “you should seriously consider the purchase of pet insurance.”

Dr. Kenney continues, “Whenever you are faced with the decision about whether to go forward with treatment when your pet has a serious illness, you want the decision to be based on prognosis for recovery and quality of life rather than finances.”

If you want to minimize money as a factor in your decisions about your pet’s medical care, pet insurance can help you accomplish that.

Keep in mind, regardless of the type and amount of insurance coverage you ultimately decide to buy, you still need immediate access to cash and an available credit line to cover the up-front costs of your pet’s treatment. After you file your claim, you can use any reimbursement for covered expenses you receive from the insurance company to pay down your debt or replenish your savings.

In Lesson 4, Part 3, of her online “Pet Insurance Guide,” Dr. Fran Wilkerson presents a more comprehensive “Pet Insurance Test” you can use to determine if pet insurance really is for you. If you still have doubts about buying pet insurance, we strongly recommend Dr. Wilkerson’s test as a way to clarify your thinking.

Bad Advice and Dumb Ideas

As part of your research, if you ventured beyond our posts, it’s likely you encountered plenty of additional advice on the pros and cons of pet insurance. Some of the information is accurate and truly helpful, but some of the suggestions are best ignored. For example—

Instead of paying the insurance company, just deposit the premiums into a savings account. Sorry, but this advice to self-insure just doesn’t add up—at least, not for decades, and it surprises and frustrates us when we see this idea passed off as a viable strategy. 

In 2022, the North American Pet Health Insurance Association reports the average annual premium for a policy covering accidents, illness and wellness expenses for a cat averaged $613.67. For a dog, the total was $1,134.29. Accident and illness coverage alone for a cat averaged $387.01 and for a dog, $640.04.

If, instead of paying insurance premiums, you deposited the money in a savings account, by the end of the first year you’d have accumulated a whopping $387 to $614 to meet emergency medical expenses for your cat or $640 to $1,134 to self-insure your dog. 

You do need savings on hand, not only to cover expected expenses for wellness care, but to help pay the policy deductible and co-insurance, bills for treating pre-existing and other excluded conditions as well as any large, unexpected vet bills. You also need available credit to cover any shortfall between cash on hand and the total amount of money you need immediately to pay vet bills up front.

Even if you increased your savings from year to year to allow for premium increases, it would take many years for you to accumulate sufficient savings to cover the costs of just one fairly serious injury or illness. And once you paid the vet bill, your savings would be wiped out—and then some—with no reimbursement on the way.

The idea of self-insurance is certainly valid for those who can afford it. We expect you know who you are. 

If your pet had an injury or illness that ended up costing $10,000—$20,000—$30,000 or more to diagnose and treat and you know you would be willing and able to pay it without a second thought, then you probably don’t need pet insurance. You may want it, though, just as you want other types of insurance to manage financial risk and protect your assets. 

Do the math to see if the policy has paid more in claims than you’ve paid out in premiums. Adding up the premiums you’ve paid so far, measuring it against claims reimbursements you’ve received and declaring pet insurance a mistake—one YouTuber even called it a scam—if your claims don’t exceed the premium total betrays a misunderstanding of the nature and purpose of insurance. 

Don’t let any self-appointed “experts” convince you to think in these terms.

You buy insurance to  manage risk—not to make a profit. The more claims you have, the more misfortune you and your pet have experienced. The insurance helps mitigate the negative financial consequences of those misfortunes, but having your claims exceed your premium totals is generally a bad, sad situation. 

If you’re not using your pet insurance, you should cancel it. The whole point of insuring your pet is to protect your financial assets in case of an unexpected, potentially expensive accident or illness. If you don’t have such an expense, that’s a very good thing.

Meanwhile, you are using the protection your policy provides every day the policy is in force, whether or not you ever make a claim. Having insurance gives you peace of mind and the choice of treatment options you would lose if you cancelled the policy and took on all the risk yourself.

The pet insurance company might deny your claim. If you read enough one-star reviews from policyholders on pet insurance review sites, you may begin to wonder if you can really count on any insurer to pay claims. 

The answer is yes—you can count on insurers to pay eligible claims according to the terms of the policy. But no, they won’t cover expenses they’ve explicitly excluded in the policy contract. Disgruntled policyholders do sometimes dispute claims denials and appeal insurers’ decisions. Sometimes they prevail.

More often, you can tell from the commentary that the unhappy policyholders didn’t bother to look beyond the premium quotes and the marketing copy before enrolling their pets. They don’t have a clue what their policies cover, but they’re angry those policies don’t cover what they assumed they would.

If you take the time to read and understand the policy before you buy and are honest with the insurance company when you sign up and later file claims, you can expect to receive your reimbursement as promised. It’s the law.

Ask your veterinarian to recommend a policy and just buy that one. It’s very commonly suggested that you ask your veterinarian for advice about pet insurance. What a handy shortcut that would be!

We are more than happy to answer these kinds of insurance-related questions:

• What pre-existing conditions are already documented in my pet’s medical records?
• Do the records show we’ve discussed and treated any common symptoms—like vomiting or diarrhea—that could later be interpreted as an early sign of a condition that gets diagnosed after the policy is in force?
• What potential health problems will a pet of my pet’s age, breed and current state of health be most likely to encounter in the future?
• What can I expect to spend on wellness—annual exams, vaccines, parasite preventives, dental cleanings—in the coming year? Can you prepare an itemized estimate for me to compare to a wellness plan reimbursement schedule?

The question we are not qualified to answer: What is the best pet insurance company and/or policy for me to buy for my pet? 

And if you’ve already bought a policy, we’re not qualified to tell you what it will and will not cover.

Even if our doctors were like Doug Kenney and Fran Wilkerson—the two veterinarians who are recognized experts in pet insurance—we would have no business telling you a specific policy to buy. 

While we do know quite a lot about your pet’s past and present state of health, we don’t know exactly what your pet’s health care needs and expenses will be in the future.

We don’t know the pet insurance policy features you would value most and we don’t know your personal financial situation. 

We don’t know all the companies and policies flooding the pet insurance market. 

We don’t know what problems you may encounter with an insurer—even one we have every reason to consider reputable—should the insurer deny a claim, delay a reimbursement or dramatically increase premiums from one year to the next. 

And frankly, we never want to hear a disgruntled client of ours say, “But you told me to buy that policy.”

Instead, with our pet insurance blog post series, we’re suggesting one way to go about choosing the best policy for you and your pet on your own. 

Admittedly, pet insurance is complicated, but if you follow our suggested steps, it’s certainly possible for you to understand well enough to make a sound buying decision. 

Then, it’s up to you to act promptly and insure your pet before any health problems occur. 

Never Too Soon

We’ll leave the final words of our series to Doug Kenney and Fran Wilkerson.

“I’ve never talked to anyone who regretted buying pet insurance too soon,” says Dr. Kenney, “but I’ve talked to many who regret not buying it soon enough.”

“Get pet insurance as early as possible,” adds Dr. Wilkerson. 

This is the fourth of a five-post client information series Brownsburg Animal Clinic is offering on pet insurance—part of our Pet Care Costs collection of posts and pages to help you manage the costs of pet ownership more effectively. As they describe step-by-step processes, we suggest you read the Pet Insurance posts in order from first to fifth.

September is National Pet Health Insurance Month, and if you’re following our pet insurance series as we publish it and acting on our advice, you should be able to finalize your policy purchase before the month is out.

If you’re discovering these weekly posts after the original publication dates in August and September 2023, we recommend you read them in sequence and follow the process we suggest reasonably closely and in order. 

By the time you arrive here, at the value-pricing stage, you’ll be just a few steps away from choosing your policy. 

Are You Ready to Value-Shop?

If you’ve been following our recommended process and haven’t yet bought a policy—and we hope you haven’t—you should prepare now to make truly meaningful comparisons between the three to five policies you’ve identified from your chosen insurers as the closest matches to your priorities and  preferences. 

If you skipped our previous posts—“Part 1. Understanding Pet Insurance,” “Part 2. Narrowing Your Choice of Pet Insurance Companies,” and “Part 3. Setting Your Pet Insurance Priorities and Preferences,” stop reading this post now and start back at the beginning of the series. 

Only after you learn the basics and take the steps we recommend will you be ready to value-shop.

Sorting the Policies

With your “Must-Haves, Nice-to-Haves, Dealbreakers” worksheet recommended in our previous post complete, sort through online policy features comparison checklists and the notes you made when narrowing your choice of companies to identify which policies best meet your criteria and which policies need to be ruled out. 

Even if you have a favorable overall impression of an insurance company, rule out their policies if the terms include dealbreakers for you. For example, if after considering your priorities and preferences, you know you really want exam fees to be covered, and this company’s policies exclude exam fees—even as supplemental coverage—remove the company from further consideration. It’s not a good choice for you and your pet. 

If you don’t have at least three potential policies left to consider, revisit and adjust your “Must-Haves, Nice-to-Haves, Dealbreakers” worksheet—particularly the dealbreakers section where you may have included provisions no company offers. 

For example, if you’re looking for a policy that covers pre-existing conditions or a company that offers immediate direct pay to any veterinarian you choose without prior arrangements between the insurer and the practice, you will have ruled out all your pet insurance policy options. 

It’s Time to Read Sample Policies

After you eliminate any policies with major dealbreaker provisions, download sample policies from the remaining three to five most promising options. 

As you prepare to value-shop these most promising-looking policies, the only way you can make valid comparisons and an informed buying decision is to read each of the policies that have made your final cut. 

Read every word of every policy.

Otherwise, you won’t understand the value each policy provides in exchange for your premium payments.

Unless you read the policy, you won’t know exactly what you’re buying and paying for, and you may set yourself up for unpleasant surprises when claims you assumed would be covered are rejected for reasons spelled out in the policy you neglected to read.

We’ve all grown accustomed to accepting terms for software products and social media accounts without reading them, and we seldom suffer negative consequences. Even when signing contracts and release forms in person, most of us say, “Just tell me what it is I’m agreeing to,” and sign our names without reading the documents.

An insurance policy is different. The product is the contract. 

Unlike a tangible product or a personally-delivered service, an insurance policy is nothing more nor less than a legal contract. Marketing copy, comparison checklists and heartwarming stories of claims paid are easy reads by comparison, but the policy terms are the only words that count. Many of those terms are not spelled out on the company’s website and in email messages.

Tedious as reading an insurance policy may be, there’s no getting around it: you simply must read the contract to know what you’re getting—and what you’re not getting—in exchange for the premiums you are asked to pay. 

We assure you reading the policies now—before you buy—is your best strategy for choosing the most benefits-rich policy to purchase and minimizing misunderstandings and disappointments in the future as you file claims. 

Knowing the policy provisions—the actual value the insurer is committing to provide and the risks you are expected to cover—is essential to your ultimate satisfaction with your choice of policy. 

So read the sample policies!

Ask Your Questions

Reading insurance policies can be a mind-numbing experience. Keep yourself engaged in the process by highlighting key benefits, noting passages that seem unclear and writing down questions you have for the insurer. 

Then call the insurance company, ask your questions and make notes of the answers. 

In addition to clarifying policy details, your call allows you to evaluate customer service. How many rings before they answered the phone? How many prerecorded system prompts did you have to respond to before you were speaking with a live customer service representative (assuming you actually reached a human)? Did the representative seem to know what he or she was talking about? Was the rep pleasant to deal with? Did the rep pressure you to enroll immediately, even though you said you’re still researching your options?

Based on this exploratory phone call, do you want to do business with this company?

Getting Serious With the Quote Tools

We’re guessing if you’ve explored pet insurance at all—either as we’ve suggested or on your own—you haven’t been able to resist requesting at least a few premium quotes using the online tools available on every insurer’s and aggregator’s website. 

If you used an aggregator’s tool to collect quotes from multiple companies, you probably noticed some pretty significant differences in prices. Remember—those numbers are meaningless until you know what policy benefits you will and won’t receive for the money. 

You may have played around with the quote tools’ settings for policy specifications and recalculated to see the impact of various options on premiums. 

If you’ve adjusted the variables, you may have observed higher deductibles, lower maximum claims payouts and lower co-insurance obligations for the insurer result in lower premiums for you. 

Keep in mind, those lower premiums for a particular policy almost always bring with them greater financial risks for you.

According to Doug Kenney, much more important than the premium amount, “The most important figure to consider is your potential out-of-pocket costs (including the premium) if you have to file a large claim, e.g., $5,000 or $10,000.” Think through the possibilities for the policies you’re considering and do the math to calculate your potential costs.

“Choosing the right policy maximum, deductible, and copay can literally save you thousands of dollars over the lifetime of your pet,” says Dr. Kenney.

Collect Quotes Directly from Insurers

At this stage in the purchase process, we encourage you to start fresh with quote tools from each insurer’s website, taking an orderly, methodical approach and making notes to compare the information you gather. 

Aggregators’ quote tools will produce results from multiple companies, including some you will have ruled out by now, and may not show the full range of policy options available for each of the policy finalists you’ve identified. 

You will also have direct access to additional details of the policies you’re considering on the insurers’ websites. 

Making Valid Comparisons

Write down the policy specifications you want to explore, noting several deductible amounts ($250, $500, $750 and $1,000, for example), several maximum payout amounts ($10,000, $15,000, $20,000 and unlimited), and several co-insurance amounts (70%, 80%, 90% and 100%). 

All these options will not be available from all companies for all pets. Some options—like a relatively high deductible or a relatively low maximum payout—will not be of enough value to you to consider and so, of course, need not be priced.

You’ll find some companies are not as flexible as others and limit your ability to customize their policies. Some will quote multiple variations on their coverage, allowing you to tailor the policy to suit your preferences. 

Others may offer only one plan or present one take-it-or-leave-it policy option for your pet. For example, if your pet is a 10-year-old bulldog—an age and breed likely to be prone to multiple heath problems—the quote tool might offer as your only available option a policy with a $5,000 maximum payout, 70% co-insurance and $500 or higher deductible. This tells you the company is willing to take on only limited risk for insuring your pet. 

In making your comparisons using the various companies’ quote tools, design policies with identical or at least very similar specifications and note the premiums quoted. 

For at least one set of policy specifications—the specs you’re leaning toward choosing, edit the pet information to add two or three years to your pet’s age and see how much higher the premiums would be at this time to issue a new policy for an older pet just like yours.

No, this won’t tell you what your premiums will be two or three years from now. But collecting quotes on an older version of your pet will at least hint at how the company’s underwriters price policies based on age. 

Shop Value, Not Price

Keep in mind, the lowest price may or may not—and probably won’t—represent the best value. Knowing that most pet insurance buyers take recommendations and shop prices without giving much consideration to the value their policies provide, many insurers feel free to issue contracts with terms that are pretty unfavorable to the unsuspecting policy buyer, compared with other insurers’ policy options. 

Consider the value companies bring. After you’ve collected premium prices for closely comparable policies, go back and review the strength, stability and reputation of each of the companies issuing the policies. You should have found this information in the initial research you did to narrow your choice of companies. 

All other factors’ being equal, a more stable, well-regarded company in business for a longer time provides more value than a relative newcomer with no financial track record and mixed reviews. 

Consider the value of policy provisions. As you may have discerned when you read the sample policies—even with identical deductibles, maximum payouts and co-insurance amounts—some policies are more generous and benefits-rich than others. 

If one insurer covers exam fees, either in the base policy or as a supplement you purchase, and the other insurer doesn’t, the value of exam fee coverage, which reduces your risk, may more than justify a higher premium if your pet ends up needing multiple visits to our clinic for one or more ongoing health concerns.

A company that applies 100% of your payments for eligible expenses toward the deductible is providing more value than one that applies a percentage based on the co-insurance amount in calculating your contribution to the deductible. 

The difference between one policy’s per-incident or per-condition deductible compared to another policy’s annual deductible could make a substantial difference in the value the policy provides over time in exchange for your premium dollars, although this difference is hard to predict.

With an annual deductible, you’ll be expected to meet the deductible by paying all eligible expenses for all veterinary care combined during the policy year. When the annual policy renewal date arrives, your paid deductible total reverts to zero and you start over again. 

With a per-incident or per-condition deductible, you are expected to meet the policy deductible for each new condition before any claims for eligible expenses for treating that particular condition will be reimbursed. 

If your pet has only one or two diagnosed conditions, particularly if the conditions are chronic and require ongoing treatment, a per-condition deductible could work in your favor. 

If your pet ends up having multiple, unrelated health problems, you will be required to meet the specified deductible amount for each problem before the policy will begin reimbursing you for eligible expenses. 

Some companies with per-incident/per condition deductibles require you to meet them only once for your pet’s lifetime, but some reset deductibles to zero every policy year. 

Which approach to deductibles—annual versus per-condition—provides more value? Given the unpredictability of your pet’s future health care needs, we would say the option that provides you with the greatest peace of mind provides more value. 

If you want to cap out-of-pocket costs reliably in the coming year, regardless of the nature and number of your pet’s potential health problems, an annual deductible would be the better choice. If you choose a per-incident/per-condition deductible, it makes sense to choose a lower deductible amount to apply to each potential condition. Otherwise, you may never meet the deductible for any one condition.

A policy that covers curable pre-existing conditions after fewer symptom-free days offers more value than a policy requiring more symptom-free days or one that doesn’t cover curable pre-existing conditions at all. 

Some conditions considered curable include ear infections, urinary tract infections, upper respiratory infections and vomiting and/or diarrhea unrelated to a chronic illness.

Most insurance companies consider a condition cured after 180 symptom-free days, while other insurers require an entire year without symptoms. 

Read the sample policies you are considering to determine if coverage includes curable pre-existing conditions at all, and if it does, how many symptom-free days will be required before a condition is considered cured and eligible for coverage.

Has your pet already experienced a bilateral condition? Some companies consider this a pre-existing condition and won’t cover the same condition if it develops on the other side—even years after the first occurrence. 

Other companies will cover a future occurrence of a bilateral condition, once any waiting period has passed and the policy is in force. 

This difference in coverage of bilateral conditions could have a significant impact on the value a policy provides you—particularly if your pet already has had any of the common bilateral conditions such as hip dysplasia, a torn cruciate ligament, patellar luxation, glaucoma, uveitis (an inflammation of the eye), or cataracts on one side or the other.

Value-Shopping Wellness Coverage

To value-shop a wellness plan, simply get an estimate of the year’s upcoming wellness services and products your pet will need and do the math to determine if the coverage will pay for itself in the benefits it will provide.

If the benefits relative to the known costs of wellness services are close to break-even, or perhaps even likely to result in a small loss, you may still elect to buy the coverage as a way to spread wellness costs out in premium payments over the entire policy year. 

If just before the wellness coverage went into effect, your pet had a dental procedure, received vaccines that won’t require a booster for the next three years and already has a microchip, the benefits may not be worth it to you.  

If wellness coverage will save you only a few dollars this year, you may prefer to include the predictable costs of wellness services and products in your regular household budget or as part of a designated savings account to cover such expenses. 

Although wellness coverage seems straightforward enough, any insurance claim takes time and documentation to file and has the potential of being denied or disputed by the insurer. 

Bear in mind, as with any veterinary service we provide, you will have to pay for wellness care at the time of service, file claims and wait to receive the reimbursements from the insurance company for wellness coverage. 

Keeping Your Chosen Policy Affordable

As you collect quotes for various levels of coverage, you’ll notice the premium costs decline as you assume more risk. 

When you first purchase your chosen policy, we encourage you to buy the best coverage you can afford. 

As the years go by and the premiums inevitably increase, be prepared to downgrade your policy at renewal time to keep it affordable. 

By increasing the deductible amount, decreasing the maximum claims payout and/or increasing your share of co-insurance, you can keep the coverage in force while keeping premiums affordable. Usually, raising the deductible amount has the most impact on premiums. Just take care not to strip so many benefits from the policy that it no longer provides sufficient protection for your pet. 

Call the insurance company a month or so before time for the policy to renew and discuss your options. The customer service representative should be able to quote how various adjustments will impact the premium amount and you can decide what compromises you are willing to make. When you’ve finalized your decisions, the company will issue a new declarations page that reflects the changes you’ve made and the revised premium amount for the coming policy year.

Bear in mind, this process typically works in only one direction. You can make changes to an existing policy to reduce coverage and premium amounts, but most companies will not allow you to enhance coverage on an existing policy. 

You may have the option to cancel the current policy and start fresh with a new, improved policy from this or any other insurer, but you will have new underwriting and waiting periods to face, and you will mostly likely lose coverage of any pre-existing conditions that developed while the previous policy was in force. 

Choose Your Best Policy

Are you overwhelmed yet? 

Are you still weighing the relative merits of the two or three most promising policies, or has an obvious best choice emerged?

Ideally, even if you haven’t identified a clear winner, you’ve done sufficient research to feel confident you most likely won’t go wrong choosing either of the policies you haven’t ruled out by now.

Read the Actual Policy

Once you finalize your purchase, read the actual policy the company issues, along with the declaration page stating the agreed-upon terms, to make sure your understanding of what you’ve bought aligns with the insurer’s. 

We know after all the research you’ve conducted to choose the right policy, the thought of reading yet another insurance policy probably seems burdensome. 

But in Lesson 9 of Pet Insurance University’s “Comprehensive Pet Insurance Guide,” Dr. Fran Wilkerson explains why you should read the issued policy.

“In addition to reading the sample policy before you buy, it is equally important that you read the actual policy you receive after you purchase the policy as things may be different after you apply,” says Dr. Wilkerson. “The underwriter may choose not to cover you for certain things after they receive your application.”

If you encounter exclusions or other terms you don’t remember having read about in the sample policy, contact the company immediately and ask for an explanation.

If you feel you’ve made a mistake with your purchase, cancel the policy. Most companies will issue a full refund if you cancel within the first 30 days, provided you have submitted no claims. 

Some pet owners buy multiple policies at this point with the intention of reading actual policies, requesting medical records reviews and then cancelling the policies they don’t want within the 30-day period.

This is the third of a five-post client information series Brownsburg Animal Clinic is offering on pet insurance—part of our Pet Care Costs collection of posts and pages to help you manage the costs of pet ownership more effectively. As they describe step-by-step processes, we suggest you read the Pet Insurance posts in order from first to fifth.

In the process of narrowing your choice of pet insurance companies and brands from nearly 50 to five or six, you undoubtedly picked up on some key policy features insurers use to differentiate themselves from their competitors. 

Some of these features may be more valuable to you and relevant to your pet than others. Now is the time to consider your own priorities and preferences to narrow your choice of companies and policies to two or three finalists. 

How Much Coverage is Enough?

If your pet has so far been essentially healthy and the veterinary healthcare expenses you’re used to covering are limited to wellness care and the occasional ear infection or torn nail, you may be shocked to learn the potential costs these days of treating more serious injuries, acute illnesses and chronic conditions. 

A July 2023 article on money.com, “How Much is an Emergency Vet Visit?” provides itemized cost estimates for emergency visits for both dogs and cats ranging from $500 to $7,500.

Further down the page, a list of common pet emergencies, illnesses and procedures shows price ranges from $25 for a urine test to $10,000 for treating severe trauma or cardiac conditions. These estimates do not appear to include any follow-up treatment. In some cases, continuing treatment might be needed for the rest of the pet’s life.  

Healthy Paws Pet Insurance has a page on its website, “Cost of Veterinary Care in 2022,” that is well worth browsing to see recent pricing trends and lists of the most common conditions in dogs and cats, along with average cost estimates for treatment. The company paid reimbursement amounts of as much as $30,000 and $40,000 to owners of featured cats and dogs. The owners’ share of the costs would be in addition to the claims amounts.

In its “State of the Industry Report 2023,” the North American Pet Health Insurance Association included among the highlights a list of top 10 claims paid by member companies for individual dogs and cats during 2022. 

At the top of the list of dogs is a 2-year-old male flat-coated retriever in New Hampshire whose case of pneumonia qualified for claims totaling $60,882. A 3-year-old female English bulldog in Houston—also with pneumonia—had claims totaling $60,215. Claims paid to cover heart issues for a 10-year-old male Akita in Pennsylvania totaled $52,659.

The unfortunate cat generating the highest claim amount in 2022—$40,057—is a 2-year-old male Sphynx from New Jersey with conditions including urethral obstruction/cystotomy, renal abscess and perineal urethrostomy surgery, pyothorax, sepsis tail amputation, hypertrophic cardiomyopathy, pericarditis and anemia. A 6-year-old male domestic short-hair cat suffering from acquired esophageal dysfunction in California had claims totaling $29,503 for the year. In New York, a 5-year-old male domestic medium hair cat’s foreign body ingestion resulted in $21,941 in claims.

We’re pretty sure the owners of these pets didn’t expect their pets to be the ones out of the entire risk pool to need such expensive care. But because they bought the insurance policies they did, when their pets’ medical needs arose, they were able to provide the level of care of their choosing without having to cover the entire cost from their own resources. 

As you determine the right amount of coverage for you, consider these potential expenses and make sure the policy you buy—particularly the policy’s maximum payout—is adequate to cover worst-case accidents and illnesses. 

Keep in mind, you’ll be expected to pay cash up front, at the time of service, should any of these unfortunate circumstances arise. Our blog post, “Sources of Cash to Pay Vet Bills,” has suggestions for generating the cash you need up front, with or without an insurance policy.

What Do You Want the Policy to Cover?

Pet healthcare expenses generally fall into two broad categories—predictable wellness or preventive care and diagnosis and treatment of unexpected accidents or illnesses. To help you meet those expenses, pet insurance policies generally provide four types of coverage—

• Accidents only
• Accidents and illnesses
• Accidents, illnesses and wellness care
• Supplemental riders and endorsements 

Accidents. These are injuries caused by such medical events as poisoning, swallowing a foreign body, broken bones and cuts that happen unexpectedly, by accident. Because of the limited scope of coverage, accident-only policies have the lowest premiums. 

Illnesses. Illnesses of any and all kinds—digestive issues, infections, malignancies, allergies, heart, kidney or lung conditions (to name only a few)—can arise suddenly or develop over time. They can be treatable and resolve within a few weeks or become chronic, lasting the rest of your pet’s life. Sadly, some illnesses can be fatal and will require hospice or palliative care.

Because all pets are vulnerable to illnesses as well as accidents, pet insurance policies covering both are most popular. We strongly recommend you choose a policy providing both accident and illness coverage.

Wellness. Wellness coverage is not so much about risk management as it is about managing your pet healthcare budget. While insurance protects you from unexpected, potentially catastrophic expenses, wellness plans typically offer an annual allowance to cover routine, predictable pet care expenses. 

Given that you’re not dealing with the unknown, you can compare in advance the expected costs of annual wellness exams, blood and fecal tests, vaccines, parasite preventives and dental cleanings to the benefits the wellness coverage provides. Spaying and neutering, microchipping and gastropexy to prevent bloat in vulnerable breeds are also predictable, necessary one-time expenses considered part of wellness care. These may or may not be covered by the wellness plan.

To decide if you want wellness coverage, simply get an estimate of the year’s upcoming wellness services and products and do the math to determine if the coverage will pay for itself in the benefits it will provide.

If the benefits relative to the known costs of wellness services are close to break-even, or perhaps even likely to result in a small loss, you may still elect to buy the coverage as a way to spread wellness costs out in premium payments over the entire policy year. 

Bear in mind, as with any covered expense, you will have to pay for wellness care at the time of service and file claims to receive the reimbursements. Although wellness coverage seems straightforward enough, any insurance claim takes time and documentation to file and has the potential of being denied or disputed by the insurer. 

If wellness coverage will save you only a few dollars, you may prefer to include the predictable costs of wellness services and products in your regular household budget or as part of a designated savings account to cover such known expenses and skip the trouble of filing claims and waiting for reimbursements. 

Supplemental riders and endorsements. You may be surprised to discover some of the coverage exclusions common to the pet insurance industry. While some companies differentiate themselves by integrating commonly-excluded coverage in their policies, others allow you to choose and pay extra for supplemental riders to cover selected exclusions. Some companies simply won’t cover certain expenses. 

Exam fees. Some policies cover exam fees, some offer exam fee coverage as an added option and some always exclude exam fees from covered expenses. 

That’s right. Our fees for your visits to our clinic to have us examine your pet will never be reimbursed by some companies or treated by other insurers as an extra available only at an additional price. It is increasingly rare for exam fee coverage to be included in the standard policy.

Given that exams are an integral part of most visits to the veterinarian, and examinations could be frequent in the event your pet experiences a serious injury or develops a chronic illness, we encourage you to insist on a policy or policy option that covers exam fees. 

Without exam fee coverage, your out-of-pocket costs could grow substantially beyond the specified deductible amount as we diagnose and treat your pet’s injuries or illnesses. We would rule out any insurer offering no coverage for exam fees.

Congenital and hereditary conditions. Some breeds of dogs and cats are known to be predisposed to certain health conditions. Most insurers cover congenital and hereditary conditions, tracking claims for treatment of these conditions by breed and pricing policies accordingly. 

If your pet’s breed is known to have an above-average frequency of certain diseases and disorders, read and compare the policies you’re considering carefully, looking for any special limits on coverage. 

You may also ask if the insurer can provide a list of congenital and hereditary conditions for your breed and disclose if these conditions will be covered before you buy the policy. 

Chronic conditions. Some incurable diseases, such as diabetes, heart failure, kidney failure, Cushing’s disease, arthritis, hypothyroidism, hyperthyroidism and cancer, can be treated and successfully managed over the lifetime of the pet. As the costs of managing chronic conditions can add up to sizable amounts, we recommend continuing coverage for chronic conditions as essential to any policy you’re considering. 

Prescription drugs. Some pet insurance policies cover the cost of drugs you take home from the clinic pharmacy as part of your pet’s treatment or make take-home drug coverage available as an add-on to the main policy. 

Some provide a list or formulary of the drugs they will cover. Our veterinarians may be able to treat your pet using only drugs on your insurer’s list, but if we know your pet will benefit most from a drug not included in the insurer’s formulary, we will discuss the options and trade-offs with you when we write the prescription. 

Make sure you understand the policy’s prescription drug coverage before you buy.

Prescription diets. We sometimes prescribe specially-formulated diets to help manage and treat diseases and to help diagnose food allergies. These diets typically cost more than “regular” pet food and if needed for prolonged periods can strain your budget.

Given their role in diagnostics and treatment, you might assume prescription diets would be fully covered by pet insurance. 

Some companies do cover a percentage of the cost of prescription diets, sometimes imposing a maximum annual dollar amount or limiting the amount of time the food costs will be covered. We recommend you choose a policy that makes prescription diet coverage available either as part of the main policy or as supplemental coverage. 

Alternative therapies. If you want coverage for therapies like acupuncture, chiropractic, homeopathic or holistic treatments, look for a policy or policy supplement that includes those. Read carefully to understand the insurer’s definition of “alternative” to determine if there are special limits on these types of therapies. 

Rehabilitative therapies. Physical therapy and other rehabilitative therapies common in human medicine are increasingly being used in veterinary medicine. For a fairly comprehensive list of the types of therapies currently available to animals, see the American Animal Hospital Association’s article, “What is veterinary physical rehabilitation?” Then find out if the policy you’re considering covers any of these specific rehabilitative therapies. You may also want to look for a policy or supplement that covers mobility equipment for pets.

Dental care. According to Doug Kenney—the veterinarian who’s written a book and maintains a blog and podcast on pet insurance—“Coverage for dental diseases is ‘all over the map’ and because they are common in pets, you should determine how a company covers these problems by reading a sample policy and/or contacting the company directly.”

Most companies will not cover having your pet’s teeth cleaned and examined under anesthesia except as part of a wellness plan. 

Most insurers will cover treating fractured teeth caused by an accident, but they may or may not cover extractions of fractured teeth or restorative root canals and crowns.

Most don’t cover periodontal disease because they consider it preventable with regular tooth-brushing and check-ups. Companies that do offer coverage may require you to keep up with regular cleanings and check-ups for the coverage to be in effect. 

Because dental health is critically important to your pet’s overall health, and because dental diseases are common, we encourage you to clarify the coverage provided by any policy you’re considering and favor the one that offers the most generous dental benefits.

Behavior therapy. As Dr. Kenney notes, “Behavior problems are among the most common reasons that pets are relinquished to shelters and otherwise healthy pets are euthanized.” He mentions separation anxiety, noise phobias, litter box aversion, aggression and obsessive-compulsive disorders as examples of behavioral problems that could benefit from diagnosis and treatment by an animal behavior specialist.

Make sure you understand any definitions and limits of coverage for behavior therapy provided by the policy itself or a supplemental rider before you buy. 

Discounts. Most companies offer discounts—commonly 5% to 10%—when insuring multiple pets from the same household. If you have more than one pet, this option is worth noting.

Some insurers offer discounts to teachers, first responders, veterans, active military personnel, AARP members and owners of support and therapy animals. If you are part of any of these groups, find out if such premium discounts are available for your policy.

What Are Your Pet’s Pre-Existing Conditions?

Among the most common reasons for an insurer’s denying a claim is that the claims adjuster believes the condition requiring treatment was pre-existing—that even without a previous definitive diagnosis, there were signs or symptoms of the illness or injury in the pet’s medical record dating back to before the policy was in force. 

Some companies ask for medical records from the previous 12 months while others ask to see records from the past 24 months or more. Obviously, the fewer months reviewed, the less likely the insurer will be to find a pre-existing condition.

While you are still in the early stages of shopping for a policy, we suggest you find out for yourself just what’s in your pet’s medical record. Ask us for a copy and read the entire document. If your pet has been treated at other practices, request and read medical records from those providers, too. 

The insurer will expect you to provide records from any veterinary care provider who’s seen your pet during the time period specified. 

You may be surprised at the level of detail you’ll find in our veterinary medical record notes. If you mention to our technicians or doctors a symptom you’ve observed—an occasional cough, a day or two of diarrhea, a single incident of vomiting—even if we weren’t overly concerned about it at the time and it seemingly resolved on its own, we probably noted in your pet’s medical record that you observed the symptom. Our front desk staff makes notes of symptoms you mention in your phone calls to the clinic and front-desk conversations—especially those requiring follow-up with other members of our team.

To a claims adjuster, medical record notes made before your coverage began can be interpreted as early signs and symptoms of what to you—and probably to us, too—is a new condition unrelated to symptoms that emerged and apparently resolved months ago. 

It’s helpful for you to know, in advance, what your pet’s medical records contain.

Bilateral Conditions. As a subcategory of pre-existing conditions, some companies exclude coverage of the second occurrence of a bilateral condition—that is a condition that can impact either or both sides of the body. 

If your pet has previously had hip or elbow dysplasia, cruciate ligament issues, a luxating patella or a cataract on one side, the policy may not cover the same condition, should it occur on the opposite side. 

To avoid misunderstandings about coverage—especially if your pet has experienced health problems on one but not the other side of its body—find out the insurer’s coverage of bilateral conditions before you buy the policy.

Medical records reviews. Dr. Kenney encourages policy buyers to ask the insurer for a medical record review after the waiting period for a new policy ends and to inform you in writing of any pre-existing conditions they will exclude from coverage. 

Some companies may be willing to conduct such a review, but many will not examine medical records until you file a claim. Only then will you know if they see early signs of a current illness dating to before the policy was in force. 

Appeals. With most policies, you will have the option to appeal their decisions about pre-existing conditions and other denials of claims. Some insurers have several levels of appeals, perhaps beginning with a review by a veterinarian on staff at the insurance company and escalating to a review by an independent panel of veterinarians who will decide if the claim should be paid. 

Ultimately, our state insurance commissioner is charged with overseeing pet insurance companies’ operations within Indiana. If all else fails, you may contact the Indiana Department of Insurance and ask for help in resolving a dispute with your pet’s insurer. We suspect the support you receive may be limited. We tried searching for “pet insurance” and “pet health insurance” on the department’s website and produced no results beyond being asked if we meant “reinsurance.” 

If you do contact the state insurance department concerning pet insurance, ask to be directed to the division handling property and casualty insurance. Despite how much we love them as members of our families, legally, pets are considered property and pet insurance policies are in the same category as homeowners and auto insurance. 

Read the policy to see how the insurer you’re considering handles appeals.

How Much Risk Are You Willing to Assume?

Think about how much risk you can reasonably afford to cover and how much risk you want to shift to the insurance company. Naturally, the lower the risk to the insurance company, the lower the policy premium.

The main variables for allocating risk are the deductible amount, the co-insurance percentage and the maximum payout. 

A policy including wellness coverage with a $250 deductible and a 90-100% co-insurance benefit and unlimited payout shifts most of the burden of your pet’s veterinary care, excluding pre-existing conditions, to the insurer. You are assuming little risk, because the chances are high that you will meet such a low deductible and have all or nearly all remaining eligible expenses covered and reimbursed by the insurer. The premium for a policy like this one will be relatively high, but you can effectively use such a policy to spread your costs of veterinary care to a fairly predictable monthly payment. 

A policy with no wellness benefits, a $1,000 deductible and 70-80% co-insurance shifts more risk to you, the pet owner. You expect to cover all the largely predictable costs of annual exams, vaccines, parasite preventives and dental cleanings as well as the first $1,000 (or more, depending on how the company calculates the deductible) in eligible expenses during the year. Your premiums for this policy will be much more affordable than the policy in the previous example because you are electing to cover more expenses and assuming more risk. For you, the goal is to cover only substantial and catastrophic expenses, so the maximum payout you choose would still need to be high—preferably unlimited.

It’s up to you to consider how much risk you are willing and able to assume, determining the maximum you could afford to spend on your pet’s healthcare and setting deductible and co-insurance amounts accordingly. 

How Much Risk Is the Insurer Willing to Assume?

The terms of the policy and any supplemental riders, along with the premium quoted, indicate the amount of risk the insurer is willing to assume on your pet’s behalf. 

Insurers carefully calculate the risk they’re taking in issuing your policy based primarily on your pet’s species, breed and age and on the average cost of veterinary care in the market where you live. Their underwriters analyze claims history of pets similar to yours and other relevant actuarial data and set their policy terms, premium prices, maximum pay-outs and co-insurance options accordingly. 

Premiums. Companies and brands set premium prices based on their own claims experiences and chosen approaches to risk assessment. Coverage for higher-risk pets—older pets and those whose breeds have more health problems than average—costs more than coverage for younger pets at relatively low risk of heritable conditions.

Pricing is also part of each insurer’s marketing strategy. When you reach the value shopping stage discussed in an upcoming post, we will encourage you to collect quotes on identical—or as similar as you can make them—policies from different insurers. We expect you’ll find differences in pricing from company to company for essentially the same coverage. 

For all insurers, the goal is to collect enough in premium payments to cover all the expected claims and expenses of running the business while generating a profit for shareholders. 

For you, the goal is to pay enough in premiums to buy the best coverage you can afford from a reputable company.

Your goal is not to find the cheapest policy.

Waiting periods. When you choose your policy and enroll your pet, you will almost certainly have to wait before full coverage goes into effect. 

Typically, insurers impose waiting periods of two days for accidents, two weeks for illnesses and six months for problems with cruciate ligaments. Illnesses and injuries that originate during the waiting period will be excluded from coverage.

These waiting periods protect the insurer from claims by policy buyers attempting to defraud the insurer by knowingly purchasing policies after the animal is already injured or ill. 

Payout limits. While some insurers offer the option of unlimited claims payouts, most policies come with a stated maximum claims payout—most commonly calculated annually for all covered claims but sometimes applied to specific conditions, to each new incident or for specific body systems—digestive, musculoskeletal and nervous. Some use predetermined benefits schedules to establish payout limits to cover specific conditions. Some companies limit the total policy payout over the pet’s lifetime. 

Some companies use a combination of maximum payout provisions. They might limit payouts per incident and cap the total for the year. 

Naturally, the higher the maximum claims payment the insurer risks making, the better the protection and the higher the premium. 

The lower the maximum payout, the greater your risk of running out of coverage in the event of a catastrophic accident or illness. In your attempt to economize on premiums, don’t accept such a low, restrictive maximum payout that your coverage becomes worthless in the event of a serious illness or accident.

Exclusions. All pet insurance policies identify medical conditions not covered, and these may or may not be listed on the insurer’s website or in marketing materials. Expenses related to diagnosing and treating excluded conditions will not count toward the deductible and will not be reimbursed. Pre-existing conditions are always excluded from coverage.

Most insurers also exclude coverage for grooming (bathing, haircuts and nail trimming), boarding and kennel fees, elective procedures like declawing, ear cropping and tail docking, costs associated with breeding and pregnancy, and lost or stolen pets. Coverage for vaccines are generally available only through wellness plans.

For full disclosure of a policy’s exclusions, you must read the policy. Call the company to ask about anything that’s unclear or so vaguely worded as to leave enough wiggle room for the insurer to deny coverage.

Requirements. Some policies set specific requirements you must meet to keep the coverage in force. For example, the insurer may require annual exams, compliance with vaccination schedules and submission of medical records. Or the policy may stipulate that the pet must live at the address listed on the policy. 

These are not the sorts of details insurers typically feature on their websites or in their promotional email messages. The only way to be sure you understand and are willing to adhere to the insurer’s requirements is to read the policy. 

Preventible diseases. Many companies exclude coverage for diseases preventable by vaccines, such as parvovirus and Bordetella, or for diseases caused by parasites for which there are preventives, such as heartworms, fleas and ticks and other internal and external parasites. 

If you routinely follow our recommended testing and vaccination schedules and regularly administer preventives, you probably will be in compliance with any preventable disease requirements. However, if your pet’s vaccination schedule has been altered for some reason—perhaps because of an allergic reaction to a vaccine—you will want to clarify the coverage terms for your pet’s preventible diseases.

Many companies also consider certain dental diseases preventible with home care. 

Breed-specific coverage caps and exclusions. Some companies reduce their risks by limiting coverage for certain breeds and excluding or capping claims for some hereditary disorders, treatments and chronic health conditions associated with some breeds. 

For example, insurers know of every 100 German shepherd dogs they cover, 20 of them are likely to develop hip dysplasia. For every 100 Persian cats they insure, they know 46 will have the genetic mutation associated with polycystic kidney disease. They know for every 100 Bernese mountain dogs and flat-coated retrievers they insure, four or five of the dogs will develop histiocytic sarcoma—a relatively rare cancer in other breeds. 

If you own what the insurer considers a “high-risk” breed, make sure you understand such limits and exclusions on any coverage you’re considering. 

Reimbursement calculations. Insurers may reduce their own risk in the ways they choose to calculate reimbursement amounts. 

They may reimburse your claim based on the amount your veterinarian charges—the best option for you, but the riskiest option for the insurer. 

Some companies reimburse based on a benefit schedule showing the maximum amount they will pay for the conditions and treatments on their list. If your veterinarian charges more than the maximum listed, the insurer will exclude the additional expense from coverage. 

Some insurers reimburse based on “usual, reasonable and customary” charges in your part of the country. As with benefits schedule calculations, the insurer will exclude covering fees your veterinarian charges in excess of what the insurer has determined is usual, reasonable and customary. 

Clarify how the insurer calculates reimbursements and understand how benefits schedules and usual, reasonable and customary limits will impact your covered expenses before buying your policy. It’s generally to your advantage to look for an insurer who reimburses based on the charges shown on our invoices.

Deductible calculations. Most people assume they’ll have met the deductible specified in their pet insurance policy once they’ve paid out-of-pocket for covered expenses totaling that amount. With pet insurance, that’s not always the case. 

Many companies factor in the co-insurance amount when calculating the deductible. For a policy with a $500 deductible and 80% co-insurance, once you’ve paid vet bills totaling $500, these companies apply only $400 to the deductible. You’ll need to pay another $125 in vet bills to meet the $500 deductible. ($625 x 80% = $500)

Read any policy you’re considering purchasing to see how the company calculates and applies your out-of-pocket costs to the deductible.

Dr. Fran Wilkerson’s Lesson on Essential Coverage

Whether or not you completed Dr. Fran Wilkerson’s “Comprehensive Pet Insurance Guide” tutorial we recommended in our first pet insurance series post, now is the time to read or reread Lesson 7, “5 Points of Coverage Your Pet Insurance Plan Must Have.”

“If you do not have these 5 components of coverage,” warns Dr. Wilkerson, “you are literally throwing your money away because you will not be covered for common, core diseases.”

Your ‘Must-Haves, Nice-to-Haves, Dealbreakers’ Worksheet

As you review this post, begin compiling a worksheet listing policy features you definitely want—the Must-Haves, the features that would be nice to have but not essential—the Nice-to-Haves, and the features or requirements that are Dealbreakers for you. 

To give you an idea of what your worksheet might contain, here’s a sample worksheet one pet insurance shopper compiled:

Must Haves

• Covers accidents and illnesses, including coverage for cancer, continuing coverage for chronic disease, coverage for hereditary and congenital diseases and conditions common to my pet’s breed*
• Benefits based on actual invoice from my vet
• 80% or 90% reimbursement
• No less than $20,000 maximum annual pay-out, preferably unlimited
• Annual deductible of $1,000 or less
• Exam fee coverage included or available as a supplement
• Quick, easy claims process
• Willing to pre-certify a claim
• Prescription drug coverage
• Covers rehabilitation therapy and equipment
• Ability to customize and downgrade coverage when premiums increase without starting over with pre-x
• Customer service available promptly by phone and willing and able to answer questions
• Apparent company stability, experience—in business at least three years

Nice-to-Haves

• Medical records review available immediately after any waiting periods conclude, ideally in time to cancel policy for a full refund
• Annual deductible based on covered expenses before co-insurance applied
• 24/7/365 customer service available, preferably by phone
• Availability of claims processors nights and weekends
• Covers “curable” pre-ex after specified time with no recurrence
• Generous, clearly explained dental coverage
• Wellness plan if reimbursements more than recover the premium cost and justify the hassle of filing claims
• Prescription diet coverage
• Alternative treatments coverage

Dealbreakers

• Claims based on usual/reasonable/customary or benefits schedule
• Per-incident or per-condition deductibles 
• No exam fee coverage
• Maximum policy payouts based on per-incident or benefit schedules
• Overly-aggressive definitions of pre-x as indicated by policy terms and customer reviews
• Possible premium increases or policy cancellation based on individual claims history
• Numerous reviews indicating lost claims, multiple demands for veterinarian to submit the same records multiple times
• Difficulty connecting by phone, getting questions answered
• Very limited or no ability to customize the policy
• Only policy offered has low maximum payout ($5,000) and 70% co-insurance—probably because they don’t want to insure older pets

*As you can tell, this pet insurance shopper completed Dr. Fran Wilkerson’s “Comprehensive Pet Insurance Guide” tutorial before compiling her list.

Your “Must-Haves, Nice-to-Haves, Dealbreakers” lists may be similar to our sample or very different. The whole point of working through this post is to identify your own priorities and preferences for your pet’s policy. 

How to Customize Your Policy

In his book, Pet Health Insurance: A Veterinarian’s Perspective, Doug Kenney offers these guidelines, in priority order, for designing a policy that provides the coverage you want at a price you can afford. 

• Get the highest annual maximum you can afford. 
• Make your share of co-insurance the lowest percentage you can afford.
• Get the lowest deductible you can afford.

In his book, Dr. Kenney includes charts illustrating the sometimes dramatic impact these variables can have on the policyholder’s out-of-pocket costs—ultimately, the most important consideration when customizing your policy. You can also do these calculations yourself to explore your share of costs for vet bills of various amounts under various policy configurations.

This is the second of a five-post client information series Brownsburg Animal Clinic is offering on pet insurance—part of our Pet Care Costs collection of posts and pages to help you manage the costs of pet ownership more effectively.  As they describe step-by-step processes, we suggest you read the Pet Insurance posts in order from first to fifth.

The North American Pet Health Insurance Association (NAPHIA) reports there are now about 25 pet insurers doing business in North America, including several companies that “also market and/or underwrite multiple white label or co-branded products representing at least 20 additional pet insurance product brands.” 

That’s nearly 50 companies and brands—far too many for most pet owners to research individually—so we recommend you start your search for your pet’s ideal policy by narrowing your choice of companies to a more manageable number—say, no more than five or six. 

With further, more focused research into those five or six companies and their product offerings, you’ll narrow your list to your personal top two or three and, finally, identify the company offering the policy you’ve identified as best for you and your pet.

Beware the ‘Best’ Lists

The internet is teeming with articles, blog posts and “complete guides” naming the “best” pet insurance companies. Many websites featuring these lists offer truly useful, unbiased information to help you understand and navigate the complexities of buying a pet insurance policy. We encourage you to learn from them as your time permits.

Many also have thoughtful evaluations of the companies on their lists—why they’re “the best,” the types of pets they’re best-suited to cover and the pros and cons of their product offerings. This commentary is well worth reading, too, while writing down the most relevant points for you and your pet. 

Most “best” company lists include established industry leaders as well as relative newcomers to the marketplace. What you’re looking for at this stage is the names of companies that appear on multiple lists and, most important, the ones offering policies that appear to be the best-matched to you and your pet’s needs. Those will be the companies you research further, using ratings and reviews from policyholders and unbiased, knowledgeable sources not trying to sell you a policy. 

Most “best pet insurance” websites encourage you to use their easy online tools to collect quotes from multiple companies. Those tools are there because the website will be paid a sales commission if their recommendations convince you to buy a policy using an affiliate link on their site. 

We advise you to proceed with caution at this stage of the buying process. If you’re following our recommended purchasing process, you’re not yet ready to make a purchase.

Your ‘Personal Best Companies’ Short List

With your guard suitably up and a determination not to buy a policy until you’ve had a chance to do further research, we recommend you visit several of these “best company” sites, linked to below, and start your own “personal best companies” list. 

While we can’t vouch for the accuracy or objectivity of any of these sites—and we’re not endorsing any of them—we’re providing links to get you started on narrowing your choice of companies. 

For your personal best companies list, look for insurers that get mentioned again and again and see if any rationale behind the ranking aligns with your pet’s needs and your preferences so far. (Presumably, the following links are “evergreen” and will take you to the most recently updated content.)

MarketWatch Guide’s “The Best Pet Insurance Companies“ and “The Best Pet Insurance Companies in Indiana.”

Forbes Advisor’s “Best Pet Insurance Companies Of [the current month and year]” and “Best Pet Insurance In Indiana Of [the current year].”

Nerdwallet’s “The 9 Best Pet Insurance Companies for [the current month and year].”

Money.com’s “Best Pet Insurance Companies of [the current month and year].”

Be forewarned, most of these sites are filled with entreaties for you to request instant quotes. Play around with the quote tools if you like, but don’t buy anything just yet. 

If you do request a quote from an aggregator site (a commission-earning website that connects to online quote tools from multiple companies and collects the results for your review), be prepared for your email inbox to fill immediately with marketing messages from the companies providing the quotes—and sometimes multiple messages from the same insurer to promote several different policies or “plans,” as they’re often called. You can unsubscribe to the messages later if you decide you no longer want to hear from a particular company.

Pawlicy Advisor. Another website worth visiting as you finalize your short list of companies is Pawlicy Advisor —the site that claims you can get a quote, choose a policy and buy it in five minutes. 

If you read our previous post, “Understanding Pet Insurance,” you know while we don’t encourage dawdling on your way to getting your pet insured, we do advise against rushing to make such a complex and important purchasing decision.

Still, we appreciate Pawlicy Advisor’s relatively powerful quote tool, designed to provide what they claim is a more personalized recommendation of the best of their partner insurers’ policies for your pet based on breed, age and other factors specific to your pet. You can find a list of their eight partner companies in the footer of the website.

We suggest you use the Pawlicy tool and consider including the companies their database matches with your pet on your list of companies to explore further.

Canine Journal. Canine Journal has a comprehensive pet insurance review page that starts by designating the companies they consider best overall, best for young pets, best no-cap payouts, best coverage, best value and best newcomer. Many details follow about pet insurance in general and individual insurers. 

Keep scrolling!

About two-thirds of the way down the page is an alphabetical list of links to insurers with the year the companies were founded. 

The page concludes with charts showing customer service options, support hours, deductible options, payout options and reimbursement options for each of the selected companies. This section also lists each company’s year founded, headquarters location and underwriter(s).

Canine Journal discloses at the top of the page that they do receive commissions if you buy a policy through one of their affiliate links.

Pet Insurance Review. A website pet insurance expert and veterinarian Dr. Fran Wilkerson recommends, and one we also suggest you visit, is Pet Insurance Review. Use this site to see reviews presumably written by policyholders for each of the companies on your short list. Keep in mind, review sites can be be vulnerable to manipulation by companies and individuals posting fake reviews.

In the reviews that appear authentic, look for the most common compliments and pay particular attention to the most common complaints, additional customer comments and the company’s responses, if any. If you’re pressed for time, skip the glowing reviews and filter to see only the most negative feedback. Look for repeated warning signs of bad coverage, harsh definitions of pre-existing conditions and poor customer service. 

As you learn more about pet insurance policies, you’ll realize many of the most negative reviews are from policyholders who didn’t do any tutorials or read their policies before buying them. They didn’t take the time to understand that pre-existing conditions are not covered, or that there would be a waiting period between the time they bought the policy and the coverage went into effect, or that the company they bought their policy from applies the deductible per condition—not per year.

Because they didn’t take the time to understand pet insurance in general and the terms of the policies they bought in particular, they experienced unpleasant surprises that wouldn’t have been surprises at all if they’d made better-informed purchase decisions. 

However, a pattern of complaints about sharp premium increases from year to year, bad customer service, a complicated claims process, lost claims or delays in receiving reimbursements are more noteworthy because they will impact you as a policyholder no matter how carefully you read your policy. 

Credible accusations of a company’s changing policy terms or terminating coverage because of claims history for an individual pet should be taken seriously. If you see multiple reviews for a company from policyholders who had this experience, we advise you to eliminate this company from consideration.

Note the dates the reviews and comments were posted. Sometimes companies improve their policies and resolve administrative problems talked about in older reviews. More recent ratings are likely more relevant to current conditions.

Check with HR. Many employers offer pet insurance as an employee benefit, so it may be worthwhile to ask about pet insurance benefits where you work. Keep in mind, the company your employer has contracted with may or may not offer the best coverage for you and your pet. Put the company on your short list, but be willing to buy from another insurer if the coverage provides better value and is a closer match to your particular needs.

Planning Travel? If you plan to travel out of state with your pet, make sure the insurer you’re considering covers eligible expenses for visits to a veterinarian outside your home state. 

If you plan international travel with your pet, check to see if veterinary treatment in the country you plan to visit will be covered. 

Also look for coverage limits—like the number of days your pet can be away from home—specific to interstate and international travel.

Planning an Interstate Move? If you anticipate moving to another state, check to see if the companies you’re considering are licensed in the state where you’re planning to move as well as the one you live in now. 

Once you relocate, the terms of your policy and the premium amount may change. If the company makes it to your personal short list, it will be well worth a call to customer service to find out how your move will impact your pet’s coverage.

Now, Read Fran Wilkerson’s Company Fact Sheets and Reviews

After you’ve narrowed your list of companies to consider to no more than a half-dozen or so, we strongly recommend a return visit to Dr. Wilkerson’s Pet Insurance University website. 

There you can read her unbiased reviews of your choice of 26 companies and see her detailed Comparison Fact Sheets on those same companies by clicking on the company name under the “Compare Pet Insurance” heading in the left sidebar of every page on the site. 

An important aspect of Dr. Wilkerson’s company reviews is her interest in the financial stability of policy underwriters. She includes A.M. Best ratings in her company evaluations.

She also notes the year each company started doing business in the USA, observing, “it can take time for a company to settle in on consistent premium pricing and policy terms.”

Keep in mind, Dr. Wilkerson has been a practicing veterinarian for many years in a number of different clinical settings. Unlike the people running all those aggregator sites, she does not receive any compensation from any insurance company for a listing or review on her site, and she earns no commission on the sale of any policy. 

See also points 6 and 7 in Lesson 9, “Additional Things You Need To Know Before You Buy,” in Dr. Wilkerson’s “The Comprehensive Pet Insurance Guide.”

This is the first of a five-post client information series Brownsburg Animal Clinic is offering on pet insurance—part of our Pet Care Costs collection of posts and pages to help you manage the costs of pet ownership more effectively. As they describe step-by-step processes, we suggest you read the Pet Insurance posts in order from first to fifth.

At Brownsburg Animal Clinic, we know pet insurance could help a number of our clients afford better, more advanced care for our patients, should they ever experience a serious, unexpected illness or injury. If you worry that because of financial constraints, you might not be free to choose the best possible care for your pet, we encourage you to consider pet insurance.

In researching our pet insurance series, we encountered multiple websites pushing us to get premium quotes and buy a policy immediately. One site urged us to collect quotes, review the results and buy a policy—all within the next five minutes!

Yes, if you can get your hands on your credit card fast enough, you really can price, choose and buy a pet insurance policy in five minutes. This advice was posted on the homepage of an aggregator site.

Aggregators tap into data from other sources—in this case, multiple pet insurers’ online quote tools—and collect the information for you to see and compare in one place. If you buy after clicking on an affiliate link on the site, the website owners earn a commission from whichever insurance company you choose. 

Unless you are an expert on pet insurance and familiar with all the nearly 50 companies and brands and the policies they are currently offering, it’s foolish to rush your purchase decision! 

Instead, we encourage you to read our pet insurance posts in order and take the time you need to explore your options. The concepts we explain, the tutorial we encourage you to complete when you’re finished reading this page (in less than an hour) and the company and policy selection processes we recommend should lead you to a sound purchasing decision by the time you finish the 5-week series.

If you’re discovering these posts after the entire weekly series has been published, you may follow our suggestions, in the order they were originally presented, to choose your best policy in even less time. 

Our goal is to help you identify and get the best choice of policy in force for your particular pet as soon as possible without rushing to a potentially faulty decision. 

Key Concepts

Before we proceed with our discussion of the finer points of pet insurance, there are several key concepts we want to be sure you understand from the outset:

You may not know what you don’t know about pet insurance. Because so much of the terminology is the same as with human health insurance, as you begin to consider health insurance for your pet, you may too quickly conclude you know all you need to know to buy your pet’s policy because after all—insurance is insurance, right? 

Throw in some instant online quotes, cute cartoons, feature comparison checklists and clever marketing copy, and you’ll be very tempted to buy a policy right then and there, without really understanding just what it is you’re buying. 

It’s true—some general knowledge of insurance will help you understand pet insurance. But pet insurance companies often apply familiar human insurance terminology, customs and concepts to animals in ways that may surprise you. Even if you think you know what familiar insurance terms mean and how insurance policies work, make no assumptions about pet insurance. 

Take the time now to learn pet insurance basics and see what policyholders and impartial reviewers have to say about how the various companies do business before choosing an insurer and buying a policy. 

Keep in mind, conditions can change quickly in the pet insurance industry. New companies and policies come on the market. Established companies are acquired and/or change underwriters. Management changes a company’s marketing strategy and direction. Greater-than-expected claims payouts in a given year necessitate unexpectedly large premium increases in years to come. Companies go out of business. 

Pet insurance policies typically do not supply ready cash to pay vet bills. Whether or not you have pet insurance, nearly all veterinary clinics—including ours—expect you to pay their invoices in full, at the time they render services. Any insurance benefit your policy provides will be paid directly to you later, after you file a claim and the company approves it, as a reimbursement. 

You will not be reimbursed for your share of the eligible expenses—the policy deductible and the percentage of the co-insurance you agreed to pay. You will not be reimbursed for ineligible or excluded expenses.

(One insurer we know of pays benefits directly to participating practices at check-out, and another will, with permission from the policyholder, arrange to pay reimbursements directly to veterinarians who have signed up ahead of time with the company and are willing to hope the claim is covered and wait for payment. We have elected not open our client records and billing system to outsiders nor to align our clinic with any one insurance company. Our policy is, as it has always been, to be paid in full by the client at the time of service.)

To be prepared to cover potentially considerable costs up front, you will need access to ready cash, supplemented as needed by a credit line and/or personal loans. The reimbursement provided by the pet insurance policy will help you pay back at least some of the money you borrowed and replenish your savings account. Bear in mind, the insurer will deny your claim if the claims adjuster determines services your pet received are not covered under the terms of the policy contract. 

See “Sources of Cash to Pay Vet Bills” for our suggestions on generating the cash you need up front, with or without an insurance policy.

You are free to choose the licensed veterinarian and the insurer you prefer. You needn’t worry about provider networks or whether or not ours or any other veterinary practice accepts a particular brand of insurance.

The policy contract is between you and the insurer. While we will provide medical records and answer medical questions about your claims, we won’t file your claims or be involved in the financial relationship between you and the insurer. You’ll already have paid us for our services and will be reimbursed for any eligible expenses under the terms of the policy you choose. 

Pet insurers do not cover pre-existing conditions. Should you file a claim for reimbursement for a vet bill you’ve paid, the insurer will review your pet’s medical records and deny coverage for any condition that appears to have originated before the policy’s effective date. 

Most companies date the condition’s onset at the first recorded sign or symptom of the problem, regardless of the date of diagnosis. After any waiting periods have passed, and barring any specific exclusions or inclusions the various companies make for “curable” pre-existing conditions, eligible expenses for any new health problems that develop will then be covered as the policy specifies. 

If you decide to cancel a policy and start fresh with a new insurer, any conditions that originated while the previous policy was in force will be treated as pre-existing conditions by the new company and will not be covered by the new policy. 

This is one of the main reasons we encourage you to choose the company and policy carefully. Once you’ve committed to a policy, it’s to your advantage to keep it in force in case your pet shows any symptoms of a developing health problem. Even without a diagnosis, if the signs and symptoms were there before the new policy is in force, the condition will most likely be considered pre-existing by the future insurer. 

Pet insurance is not an investment. It’s a risk management tool. Your pet’s policy allows you to share some of the risks that your pet may have an expensive accident or illness with other pet-owning policyholders whose pets face similar risks. You should no more hope your pet insurance policy pays out more in benefits than you pay in premiums than you hope to have a wreck or a house fire so your auto and homeowners insurance claims exceed premium totals. 

Based on the costs of veterinary services where you live, the species, breed and age of your pet and the company’s claims experience, premiums will likely rise each year—some years by a little and some years by a lot. For example, the premium for one pet insurance policy issued on an 8-year-old poodle mix increased by 15% after the first policy year, 19% after the second, 8% after the third year and 39% after the fourth. 

Naturally, as pets get older, their risks of health problems increase and premium costs rise. If you relocate to a higher-priced market, your premiums will likely increase. The rising costs of veterinary care, changes in company ownership, management and/or underwriters may also result in increases in policy rates and other terms.

For more insight into rising pet insurance premium costs and what policyholders may reasonably expect in the future, see “Jump in pet insurance prices tests appetite for coverage,” on the Veterinary Information Network’s news service website.

There is no “best pet insurance company” or “best pet insurance policy” for all pets and their owners. If you ask us to recommend the best pet insurance, some of our doctors and team members may well name a company or two. We may even tell stories of clients and patients who had good experiences with their pet insurance policies.

Just keep in mind—we are not licensed insurance agents. We are familiar at most with only a few companies and policies of the fast-growing number available. While we know a lot about your pet’s medical condition and health risks, we don’t know your personal financial situation, priorities and preferences.

And we are not able to foretell the future.

That’s why our clinic’s official policy is to refrain from aligning with or recommending specific insurance companies and to encourage you to do your own research to find the best policy for you and your pet. 

We’re publishing this series to help you do just that.

It takes learning, self-reflection and value shopping to make a sound pet insurance policy purchase decision. In the world of consumer behavior, buying a pet insurance policy would be classified as a “complex purchase.” If you approach the purchase as we suggest, you will conduct fairly thorough research before you buy a policy because of the relatively high degree of economic and psychological risk involved in insuring your cherished pet. 

Of course, you can skip the research, buy from among the first policies you find online—maybe the policy with the lowest premium—and hope for the best. 

Or you can leave your pet uninsured, as most pet owners in America do. Many of them are clients we see every day whose pets could benefit from treatment they tell us they can’t afford. 

The Insurance-Buying Process We Recommend

Step 1. Make your own short list of best-for-you insurers. Narrow the list of nearly 50 companies and brands of pet insurance in the market now to a list of five or six that appear to be the best matches for you and your pet.

Step 2. Identify what policy terms are best for you and your pet. Based on your initial exploration of the various insurers’ policy features, set your personal priorities and preferences for the pet insurance coverage you most want your policy to provide.

Step 3. Value-shop the policies. After narrowing your choices to the three to five most promising-looking policies,  collect and compare quotes and read sample policies to help you understand the coverage you will—and won’t—receive in exchange for your premium payments.

Step 4. Choose the best policy for you and your pet. Once you’ve identified the policy that delivers the best value for your money, you’re ready to enroll your pet and get started on the waiting periods.

Step 5. Address any lingering doubts, objections or misgivings you may have about your policy purchase. 

Help With Finding the Best Insurance Policy for Your Pet

Two experts we trust to provide our clients with accurate, unbiased information about pet insurance are Dr. Frances Wilkerson and Dr. Doug Kenney—both veterinarians who have considerable expertise in pet insurers and policies.

Dr. Wilkerson has maintained her Pet Insurance University website since 2008, and it appears to be up-to-date these days with some of the newer companies and brands listed and reviewed.

Before you browse the rest of the site, we suggest you begin by reviewing “The Comprehensive Pet Insurance Guide,” Dr. Wilkerson’s online tutorial that can be completed in less than an hour. 

Seriously. Do this tutorial. 

You may also find Dr. Wilkerson’s glossary of pet insurance terms helpful as you conduct your research.

In 2016, Dr. Kenney published a book, Pet Health Insurance: A Veterinarian’s Perspective, available from Amazon. An edition updated in 2021 is available on Apple Books.

Dr. Kenney’s book covers pet insurance in somewhat greater detail than Dr. Wilkerson’s tutorial and is well worth reading if you want to develop an even deeper understanding of multiple aspects of pet insurance before settling on the company and policy that’s best for you and your pet. Both the print and the digital editions of the book have links connecting you to additional resources.

Dr. Kenney maintains a blog with posts dating back to 2009 at the Your Pet Insurance Guide website. As host of The Pet Insurance Guide Podcast since 2012, he has interviewed founders and executives from many of the industry’s leading companies. 

Dr. Kenney’s Pet Insurance Toolkit is available on his website for $15.

We suggest, once you’ve mastered pet insurance basics, you browse Dr. Kenney’s blog posts and podcast episodes to get to know some pet insurance industry leaders and to clarify topics of interest.