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Part 1. Understanding Pet Insurance

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.