Is Pet Insurance Right For You?

In 2018, Americans were estimated to have spent $18 billion on veterinary care, with 7% annual growth since at least 2016 (AAPA). There have been major advances in veterinary medicine and access to testing and diagnostics that were once only available for human health care. Veterinarians are able to treat an expanding array of diseases and conditions, but often at increasingly higher costs. The rise in popularity of pet health insurance plans is one way that pet owners are addressing the rising costs of veterinary care.

In 2012, my cat, Pavel, was diagnosed with urinary bladder stones shortly after he started tripling his typical number of visits to the litter box. The stones were large enough that they required surgical intervention at a cost of nearly $2,000. As many of you are familiar, these issues seem to present at the worst possible times. I had just moved to D.C. from across the country, and my savings account was still crying itself to sleep. Luckily, I was able to rely on a credit card, but the panic that set in after the sticker shock prompted me to explore my options for pet health insurance for both my dog and cat. I ultimately chose Healthy Paws.

Several years later, me and my best doggo of ten years, Uly, found ourselves bouncing between appointments with specialty veterinary hospitals trying to figure out what was going on with her lack of appetite and an increasingly worrisome series of liver function blood tests. Uly’s health deteriorated very quickly after we determined that her liver was full of what were suspected to be cancerous masses, and she was on palliative care at home until she let us know it was time. Uly’s veterinary bills totaled approximately $6,000, and I was glad that I had the safety net of an insurance policy during this difficult time, so I could make medical decisions based solely on her immediate needs instead of having to delay or forgo diagnostic and treatment options because of finances.

These experiences are why having pet health insurance is right for me, but this is a decision that everyone should make based on their own circumstances and the needs of their pets.

PROS

• Expensive Treatments Become Affordable — surgery, chemotherapy, emergency services, and prescriptions become more accessible with an insurance plan. Emergency surgery and corresponding after care can easily reach $10k, and insurance plans could reduce this by 90%.
• Easy to Evaluate Plans — Policies are relatively simple and devoid of the numerous provisions and caveats that occur in human health insurance plans. Plus, you can get quotes from insurance companies in just a few short minutes.
• Customizable Plans Can Mitigate Costs — The cost of the monthly premiums, deductibles, and the reimbursement tiers can all be customized to balance the costs of monthly premiums.
• Freedom to Choose Your Vet — There are no in-network or out-of-network veterinarians, so you can continue to use the vet of your choosing.

CONS

• Monthly Premiums Can Be Large — If you have a pet that is older, or you live in a region associated with higher than average veterinary costs, your premium can be high.
• Upfront Payments — Most plans operate on a reimbursement basis that require you to pay the veterinary clinic in full and then submit receipts and wait for a reimbursement.
• Limited Coverage — Your pet may be limited in their coverage if your pet has a preexisting condition, if your plan has low annual and/or lifetime limits, or if your plan excludes particular conditions/treatments across the board or specific to a particular breed.
• Un-insurable — If your pet has reached a certain age, they may not be able to enroll in a new policy; however, this is generally not a concern if they were already enrolled prior to reaching a particular age.

There are quite a few pet health insurance providers, each with their own unique set of policies that fit a variety of needs. There are nearly a dozen companies that sell pet insurance in the United States. The largest, in order of market share, are Nationwide, Trupanion, and Healthy Paws (WSJ).

Insurance policies run the gamut from accident-only coverage with annual caps to expansive policies that cover vaccinations, preventative medications, and wellness visits with no annual caps. The cost of the monthly premium takes into account your pet’s age, breed, and location, and you can often further adjust the monthly premium by changing the annual deductible and the desired percent coverage. The average monthly premium for accident and illness plans was $43 dollars in 2017 (AAPA). However, the average monthly premiums begin at about $22 for dogs and $16 for cats (Consumer Reports).

Having your little furry, and sometimes not so furry, friends insured is fantastic, although that’s only the first half of the process. The second half is paying for the services rendered. While this may sound counter intuitive to having an insurance policy, it is largely standard in the industry to require that veterinary services be paid in full upfront, followed by a reimbursement from the insurance company once the paperwork has been submitted. For many, this poses a problem given that if you do not have $1,000 available for unexpected veterinary fees, you also do not have $1,000 to pay for the upfront costs for these fees while you wait for reimbursement.

At least one insurance company, Trupanion, addresses this issue by paying the veterinarian directly, and the only upfront fees are the deductible, copay, and any uncovered costs. However, you need to check with the company to determine which veterinary practices have direct billing relationships with the company.

If you think that pet health insurance is right for you and your critters, I urge you to get at least three quotes from different companies and be sure to read the policy documents regarding coverage, so you are fully aware of what is or is not covered. If you cannot easily find this information on the insurance providers’ websites, I have found that a call to customer service to ask for copies of prospective policy documents is often helpful. Check out Pet Insurance Review for reviews and comparisons of multiple insurance providers. Lastly, if you are on the fence about which insurance company and policy works best for your pets’ needs, you should discuss your options with your veterinarian to seek their expertise.

What are some of your experiences that helped you determine whether pet health insurance is right for you and pets? Sound off in the comments.

Featured image by @topithecorgi.

Jeff Bolland

Jeff lives in Washington D.C. with his boyfriend, dog (Luka), and cat (Digby). Jeff is a biotech patent agent by day, and a law student by night.