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From routine veterinary exams to emergency surgery, caring for your pet's health can be costly. Pet insurance protects you from unexpected vet bills, helping you pay for the medical care your pet needs without draining your bank account.
Here's a closer look at how pet insurance works, what it covers and doesn't cover, how much pet insurance costs and how to find the perfect pet insurance policy.
What Is Pet Insurance?
Similar to health insurance for humans, pet insurance helps pay the cost of your pet's veterinary care. You buy a policy, pay premiums and submit claims for covered care to the insurance company. If your claim is approved, the insurer reimburses you for the cost of covered services, minus any deductible or coinsurance payments you owe.
How Does Pet Insurance Work?
Understanding how pet insurance works will help you choose the best policy for you and your pet. Here are some key terms to know.
Deductible
When you file a pet insurance claim, you're responsible for paying a deductible out of pocket before your insurance coverage kicks in. Most plans let you choose the deductible, which generally ranges from $100 to $500. Some plans have annual deductibles; others have per-treatment deductibles. Typically, plans with higher deductibles cost less.
Reimbursement Rate
The insurance policy's reimbursement rate indicates how much of the vet bill you'll be reimbursed for. You can usually choose from reimbursement rates ranging from 60% to 90%; some plans even offer a 100% reimbursement option. Generally, plans that reimburse more of your costs have higher premiums.
Coinsurance
Coinsurance is the amount of the vet bill you're responsible for paying. Essentially, it's the opposite of the reimbursement rate. If your pet insurance policy has an 80% reimbursement rate, your coinsurance is 20%.
Waiting Period
You can't use pet insurance the day you purchase it. Instead, there's generally a waiting period before your pet's veterinary care is covered. Waiting periods vary from one insurer to another, but typical waiting periods are:
- Two days for accidents
- 14 days for illness
- Six months for orthopedic problems
Annual and Lifetime Limits
Some pet insurance policies limit the total amount they'll reimburse you per year; others have no annual limits. You can generally choose your annual limit when you purchase a policy. There may also be separate annual limits for certain conditions, such as dental diseases.
Pet insurance companies may also set lifetime limits, which cap the total amount you can be reimbursed over your pet's lifetime. However, you can also find pet insurance with no lifetime limits.
Renewal
After one year, most pet insurance policies renew automatically. When your new policy year begins, your annual deductible and annual limits reset. Your premiums may also increase as your pet gets older and more likely to have health problems, or as the cost of veterinary care rises. You'll generally get a notice of your upcoming renewal in advance. This gives you a chance to review any changes to your policy and adjust your coverage as needed to help keep your premiums manageable.
What Does Pet Insurance Cover?
In general, you have three options for pet insurance, each offering different types of coverage.
1. Accident-Only Coverage
This type of pet insurance pays to treat accidents or injuries such as:
- Injuries from car accidents
- Cuts and lacerations
- Torn ligaments
- Broken bones
- Accidental poisoning
- Eating a foreign object
2. Accident and Illness Coverage
In addition to accidents, an accident and illness pet insurance policy covers treatment for illnesses such as:
- Diabetes
- Cancer
- Skin, eye or ear infections
- Urinary tract infections
- Digestive problems
- Arthritis
Pet accident and illness insurance coverage can vary widely from one provider and plan to another. For example, some plans cover the following, while others don't.
- Alternative treatments such as acupuncture
- Breed-specific issues
- Dental accidents and illnesses
- Exam fees for ill or injured pets
- Hereditary or congenital conditions
- Physical therapy
- Prescription vitamin supplements or pet food
- Telehealth or virtual vet visits
- Treatment for preventable conditions, such as parasites
- Treatment for behavioral issues
- Euthanasia and cremation
These kinds of coverage may be part of a standard pet insurance policy or may require purchasing add-on insurance.
3. Wellness Plans
Neither accident nor illness insurance cover preventive care for your pet, such as vaccinations, annual exams and dental cleanings. However, most insurance carriers offer wellness plans that you can add to your pet insurance policy for an extra fee. These typically help pay for:
- Annual exams
- Blood tests
- Dental cleanings
- Heartworm, flea and tick prevention
- Microchip implantation
- Spaying and neutering
- Vaccinations
Wellness plans generally don't cover the full cost of preventive care. Instead, they reimburse you up to a set maximum for each treatment, such as $100 for a dental cleaning or $20 for a vaccine.
What Doesn't Pet Insurance Cover?
Most pet insurance policies exclude pre-existing conditions from coverage. If your pet showed symptoms of or was diagnosed with an illness or injury before your pet insurance took effect, it's considered a pre-existing condition and generally not covered.
However, some pet insurance policies cover pre-existing conditions that are curable. Being cured typically requires your pet to be symptom-free without treatment for a certain period, such as 180 days or one year.
Other things that typically aren't covered by pet insurance:
- Disorders that certain breeds are susceptible to, such as hip dysplasia or breathing issues.
- Cosmetic treatments such as tail docking, dew claw removal or ear cropping
- Conditions caused by neglect or failing to follow your vet's recommended treatment
- Breeding or pregnancy
- Preventive care (unless you purchase a wellness plan)
- Injuries due to abuse, including racing or fighting
How Much Does Pet Insurance Cost?
Depending on your pet and the coverage you choose, the average annual cost of pet insurance is $116 to $625 for cats, and $204 to $1,263 for dogs, according to the North American Pet Health Insurance Association (NAPHIA). The more comprehensive your pet's coverage is, the more you can expect to pay. Premiums also tend to rise as your pet gets older and more likely to suffer chronic or serious health issues.
| Average Premiums for Pet Insurance | |||
|---|---|---|---|
| Animal | Accident-Only Coverage | Accident and Illness Coverage | Accident, Illness and Wellness Coverage |
| Dog | Annual: $204.16 Monthly $17.01 | Annual: $675.61 Monthly: $56.30 | Annual: $1,263.39 Monthly: $105.28 |
| Cat | Annual: $116.11 Monthly $9.68 | Annual: $383.30 Monthly: $31.94 | Annual: $625.99 Monthly: $52.17 |
Source: North American Pet Health Insurance Association
If the price of pet insurance seems high, compare it to the average costs of veterinary care. Here's how much you can expect to pay for some common procedures your pet may need, according to 2024 Yelp data.
- Emergency surgery: $1,500 to $7,000
- Urinary tract infection: $300 to $1,500
- Dental cleaning with anesthesia: $450 to $1,000
- Chemotherapy: $3,500+
- Blood tests: $70 to $250
Typically, you can opt to pay your pet insurance premiums monthly, quarterly or annually. Paying monthly can make it easier to fit pet insurance into your budget; however, many providers offer a discount if you pay annually.
Learn more >> How to Save Money on Pet Insurance
How to Buy Pet Insurance
Pet insurance isn't as strictly regulated as health insurance for humans, so there are often significant differences in coverage from one plan to another. To simplify shopping for pet insurance, follow these steps.
1. Decide What Type of Coverage You Need
Accident-only policies generally cost less, but accident and illness insurance offers more comprehensive coverage. Consider the deductible and payout limits that best fit your budget. Also evaluate your pet's lifestyle and current health. For instance, if you own a purebred dog, you may want pet insurance that covers breed-specific conditions. Pet wellness plans typically cap per-treatment and annual payouts. Compare the cost of a wellness plan against the maximum possible payout to see if it's worth the money.
2. Investigate Insurance Providers
Your homeowners or auto insurance carrier may offer pet insurance. There are also many specialty pet insurance providers. Visit insurance company websites to get a general idea of their offerings and eliminate insurers that don't offer the coverage you want.
3. Get Multiple Pet Insurance Quotes
Prices for pet insurance can vary widely, so get quotes from several insurance carriers. You can do this quickly using a comparison site that gathers quotes from multiple companies in one place. To be sure you're comparing apples to apples, get quotes from each company for the same type and amount of coverage, as well as the same deductible amount, reimbursement rate and plan maximums.
4. Review Policy Details
What is covered and excluded? How long are the waiting periods? How quickly will you get reimbursed? Pet insurance companies typically provide sample policies you can review to get a clearer idea of exactly what is included, as well as any rules you must follow to maintain coverage. For example, you may have to provide your pet's medical records or pay for a wellness exam within a certain time after purchasing your insurance policy.
5. Purchase Your Policy
You'll need to pay your premium to start coverage, and can use your policy once your waiting periods are over. Consider setting up autopay to ensure you don't miss a payment, which could cost you your coverage.
Frequently Asked Questions
You may not need pet insurance if you have enough savings in your emergency fund to easily cover the cost of a big vet bill. For many pet owners, however, pet insurance provides assurance you can pay for the treatment your pet needs without emptying your bank account.
Suppose your dog needs surgery costing $5,000, and you have pet insurance with an 80% reimbursement rate and a $250 annual deductible that you haven't paid yet.
Some pet insurance companies subtract your deductible from the total vet bill and calculate your coinsurance based on the remaining balance. In that case, here's what you'd owe:
$5,000 - $250 deductible = $4,750
$4,750 x 20% coinsurance = $950
You owe: $950 + $250 deductible = $1,200Other pet insurance policies calculate coinsurance first, then subtract your deductible from the remaining balance. Here's what that would look like:
$5,000 x 20% coinsurance = $1,000
You owe: $1,000 + $250 deductible = $1,250Without pet insurance, you'd be on the hook for $5,000. In the worst-case scenario, you might have to make the painful decision to euthanize your pet simply because you can't afford costly medical care.
Learn more >> Is Pet Insurance Worth It?
Pet insurance is generally accepted everywhere. Unlike most health insurance for humans, there's no need to stay within a network of providers. The exception: Some pet insurance companies pay your vet directly; the vet then bills you for the remaining balance. If you choose this option, you'll need to make sure your vet accepts the insurance.
While each insurer's steps for filing a pet insurance claim may differ slightly, in general here's how it works:
- Submit your claim. You can typically submit claims via the insurance company's mobile app or website, by email, by fax or by mail. You may need to fill out a claim form or file the claim within a certain time frame; check with your insurer for details.
- Provide documentation. You'll typically be asked to submit an itemized invoice detailing each expense. You may also need to provide medical notes from the vet visit and a copy of your receipt showing payment.
- Wait for a decision. The insurance company will review your claim and gather any additional information needed to approve or deny it. During this time, you can usually track the status of your claim in your account online or in the mobile app.
- Receive payment. Most providers pay you via check or direct deposit to your bank account.
The Bottom Line
Purchasing pet insurance won't eliminate all your pet care costs, so be sure to budget for things your plan doesn't cover. Also keep in mind you'll generally need to pay your vet upfront and wait for reimbursement from the pet insurance company.
You could use a sinking fund to save for pet care expenses and replenish it when you receive your insurance payout. A credit card with an introductory 0% annual percentage rate (APR) on purchases can be another way to cover an unexpected vet bill. Pay your balance before the promotional period ends, and you won't accrue any interest.
As you plan how to keep your furry friend healthy, don't forget to keep your credit score in good shape too. Good credit can help you access loans, credit cards and other financial resources to pay for your pet's veterinary care.