Is Pet Insurance Worth It? Here's the Latest Info

Is pet insurance worth it? If you have a pet, you’ve undoubtedly heard the chatter surrounding pet insurance and are wondering what all the hoopla is about. This relatively new trend of insuring pets is growing rapidly and is something all pet owners should consider. Why are so many people talking about pet insurance? Let’s take a look.

The Pet Insurance Industry is Growing

While some pet parents remain unsure of the benefits of having pet insurance, the industry is seeing a significant boom. According to a recent report released by the North American Pet Health Insurance Association (NAPHIA), participation in pet health plans continues to grow at a steady rate. Now, over 7 million pets in North America are insured, a 12.2% increase from just one year earlier.

This boom is leading to a major shift in the industry, motivating providers to offer increasingly beneficial policies at affordable rates. In fact, costs for many policies are significantly less than you’ll pay to insure your health, home, car, or boat.

What is Pet Insurance?

Pet insurance is a policy that covers your pet’s health and wellness needs, similar to the way your health insurance covers your needs. However, in the United States, pets are considered a type of ‘property.’ For this reason, your pet health insurance policy will function more like property insurance, such as car insurance or renters insurance, than like human health insurance.

Types of Pet Insurance Coverage

When you begin shopping for pet insurance, you’ll find that there are several types of coverage available. These include:

• Accident-Only Coverage

• Comprehensive Coverage

• Wellness Plans

Accident-Only Plans

Depending on your pet’s needs and the policy cost, you might choose one or more of these benefit options for your plan. If you select an Accident-Only plan, your plan will cover expenses related to unforeseen accidents and injuries. These include injuries such as:

• Broken bones

• Bite wounds

• Foreign body ingestion

• Cuts and lacerations

• Eye trauma

These plans are often very affordable, but exclude coverage for wellness care, illnesses, and chronic conditions.

Comprehensive Coverage Plans

If you’re looking for a more inclusive policy, selecting a Comprehensive Coverage plan will provide coverage if your pet experiences an accident or an illness. Adding on the illness coverage boosts your plan to include conditions such as:

• Ear or skin infections

• Cancer

• Diabetes

• Arthritis

• Digestive issues

• Chronic health conditions

While you’ll pay slightly more for a comprehensive plan, it’s often worth the cost in the long run. However, keep in mind that even a comprehensive plan will exclude pre-existing conditions and vet visits related to preventative care and wellness.

Wellness Plans

Pet insurance providers design wellness plans to provide pet owners with coverage for preventative care and services provided at wellness vet visits. These include:

• Annual checkups

• Vaccinations

• Blood work

• Dental cleanings

• Flea, tick, and heartworm prevention

Pet insurance providers typically offer these plans as an add-on to comprehensive coverage and not as a stand-alone policy.

What Does Pet Insurance Cover?

Pet insurance covers a wide range of pet health needs, depending on your specific policy. Common coverage options include:

• Accidents: Injuries from falls, car accidents, rough play, etc.

• Illnesses: Treatment for diseases, infections, and chronic conditions

• Preventative Care: Veterinary care at wellness exams, such as vaccinations and dental care

• Emergency Care: Cost of emergency vet visits, surgeries, and hospitalizations

• Specialist Care: Treatment from specialists such as oncologists or cardiologists

• Alternative Therapies: Treatment that includes chiropractic care, physical therapy, etc.

• Prescription Medication: Cost of medications prescribed by a veterinarian.

• End-of-Life Care: Coverage of euthanasia, cremations, commemorative items.

Your pet health insurance coverage will vary depending on the selections you make when purchasing your policy and your policy’s exclusions. Always review your policy documents carefully to fully understand the benefits available to you.

Best Pet Insurance Providers

Pet insurance plans, like many other types of insurance policies, vary widely from provider to provider. Fortunately, with some careful shopping, you can find a pet insurance company that works for you.

As you consider which of the Top Pet Insurance Companies you should choose, there are some factors to consider, such as:

• Cost of premiums

• Coverage limitations or exclusions

• Your pet’s breed and whether they’re prone to certain conditions

• Your pet’s age and current health issues

• Your financial outlook and how much coverage you need

• Whether your veterinarian participates with a direct-pay provider

Fortunately, you don’t have to go at this alone. We’ve done the legwork and have broken down each company’s provisions so you know exactly which one is best for you. Check out our best company reviews, including our partner's site at Lemonade.

• MetLife

• Spot

• Lemonade

• Embrace

• Odie

How Does Pet Insurance Work?

When purchasing your pet insurance policy, it’s essential to understand the factors that go into making your plan function. Let’s talk a bit about the basics.

Premiums

Premiums are the monthly fee you pay to the pet insurance company to hold your policy. These are calculated based on the policy options you choose at the time of purchase and typically stay the same for each plan year.

Deductibles

Deductibles are the amount of expenses that you agree to pay before your pet health insurance plan will kick in. These often range from $100 to $1,000 and renew annually. Choosing a lower deductible will result in a higher plan premium, while choosing a higher deductible will result in a lower plan premium.

Reimbursement

Most pet health insurance plans work by reimbursement. This means that when you take your pet to the vet, you’ll pay the vet bill in full at the time of service. You’ll then file a claim with your pet insurance company, and they will reimburse you for covered expenses, minus the deductible you owe. The benefit to these types of policies is that you can use any licensed veterinarian you choose, as long as they are within a coverage area.

Direct Pay

While uncommon, some pet insurance plans offer direct pay. When using these policies, your pet insurance plan will pay your vet directly, eliminating the need for you to pay upfront. When using a direct pay plan, you must first ensure that your veterinarian works with your insurance company.

Claims

After you’ve taken your pet to the veterinarian, you must file a claim with your pet insurance company. This will include providing documentation of the visit and cost to your insurance provider. In most cases, you can file your claim easily using a smartphone app or online. Once filed, your pet insurance provider typically processes claims within a matter of days.

Waiting Period

This is the amount of time, typically days, that you must wait to use your policy after purchase. Some policies indicate different waiting periods for different needs, such as illness vs injury.

Maximum Annual Coverage

This amount, often ranging from $5,000-unlimited, is the total cost that your pet insurance provider will reimburse to you in a plan year. Selecting a higher amount will result in higher premiums, but provide better overall coverage.

Reimbursement Rate

Your policy’s reimbursement rate indicates how much of the covered expenses (minus your deductible) your provider will reimburse to you for each claim. These percentages range from 70% to 100%.

Benefits of Pet Insurance

Carrying a pet health insurance policy provides excellent benefits for both you and your pet. These include:

• Financial protection against unexpected vet bills

• Wider range of treatment options

• Peace of mind in knowing that finances won’t hinder you from taking your pet to the vet

• Fringe benefits such as pet telehealth visits

• Discounts for bundling with other insurance plans

Pet insurance is just as important as your health insurance policy, and has the added benefit of being more affordable.

Is Pet Insurance Worth It?

While there are costs associated with carrying a policy, the benefits of a pet insurance plan greatly outweigh them. Considering that veterinarian costs can range from a few hundred to several thousand dollars, purchasing a policy, even without add-ons, will prove beneficial when the time comes to use it.

If you’re still unsure whether vet insurance is worth the cost, check out our review of the Top Pet Insurance Companies to find out more about what is covered and exactly how much that coverage will cost for your pet.