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HealthyAssurance by petMD

Healthy Assurance's mission is simple: To provide pet owners with unbiased, reliable, helpful, and timely information on pet insurance from a veterinarian’s perspective. And what better veterinarian to write this blog than Dr. Kenney, a small animal practioner and author of Your Guide to Understanding Pet Health Insurance

Per-Incident Maximum: Don’t Overlook This Important Factor When Purchasing Pet Insurance

One of the most significant factors that can increase your out-of-pocket expense when filing a pet insurance claim is having a policy with a "per-incident" maximum. What's that, you may ask? Per-incident generally means the maximum the insurance company will pay out each time a new problem or disease occurs. An annual maximum, on the other hand, is the maximum the company will pay out during the policy term (usually one year).


Let’s say that your pet is diagnosed and treated for pancreatitis and your insurance policy has a $10,000 annual limit and no per-incident limit. In this case, the company would pay out up to the full $10,000 for the illness. However, if your policy has a $10,000 annual maximum and a $1,500 per-incident maximum, the company would pay out up to $1,500 for the illness. The remaining $8,500 could be used for other accidents or illnesses during the year other than pancreatitis (up to $1,500 each).

If the bill for treating the pancreatitis is $5,000, the table below illustrates the impact on your out-of-pocket costs.

I have read numerous reviews by pet owners who purchased a policy like this and when they had to file a large claim like the one above. It was evident that they didn’t really understand the effect that the per-incident maximum would have on their reimbursement and, consequently, their out-of-pocket expense.

Not all per-incident maximums are defined the same way — especially when it comes to reimbursements for chronic diseases. In the illustration below, let’s assume that Company A and Company B both have a $1,500 per-incident maximum. Let’s also assume that your pet is diagnosed with diabetes and has ongoing monitoring and treatment expenses for several years.

With Company A, the total reimbursement for diabetes is $1,500. Once you hit that limit, no more benefits are available. This is sometimes referred to as a per-condition maximum. With Company B, the per-incident maximum renews every year so that you have a $1,500 annual reimbursement limit for the ongoing treatment of your pet’s diabetes.

There is also a pet insurance company that reimburses according to "categories," which are essentially body systems (e.g. musculoskeletal, heart, respiratory, etc). You can file multiple claims over several years for that body system until you reach the category maximum. Once you reach the reimbursement limit for that category (body system), there are no more benefits available.

Therefore, be careful when considering the purchase of a policy with a per-incident or category limit. As long as you are filing relatively small claims, you won’t notice the limitations of such policies. My advice is to always judge an insurance policy by asking yourself, "What will the insurance company pay and what will I have to pay out-of-pocket if I have to file a $5,000 or a $10,000 claim?" This will tend to magnify the shortcomings of a policy with a per-incident maximum.

Dr. Doug Kenney

Pic of the day: Twins by Kees Wielemaker

Twin beagle dogs on couch, pet insurance, pet insurance claim, pet insurance policy, per-incident maximum, pet insurance benefits

Comments  7

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  • 06/23/2011 07:11am

    I had a client come to me with a sample policy she was thinking of buying. It had like a $2000 per-system LIFETIME maximum. Shoot, one FB surgery could wipe that out for the GI system easy, and then no reimbursement for any stomach problems ever again. She totally did not understand the limit until I explained it to her, and Was very grateful that I took the time to do so.

  • 06/23/2011 07:35am

    Thanks, wikith for that comment. It illustrates 2 things that I've said before:

    1) Many pet owners don't understand pet insurance and what they are purchasing and consequently run the risk of making unwise decisions.

    2) A veterinarian's perspective is an important one IF the veterinarian really takes the time to decipher a policy.

  • Wow!
    06/23/2011 07:46am

    It would never have occurred to me that there might be limitations such as these. Excellent information ~ thank you!

    Thank goodness human insurance isn't as restrictive.

  • How do you know?
    06/23/2011 04:34pm

    It makes my head hurt just to juggle all the possibilities. You have to weigh the cost of the premiums against the possiblity of your pet contracting an illness or having an accident. Our cat has developed diabetes, so I'll be aware of that possibility, but since I am also more aware of nutrition, there's a greater possibility the next cat won't suffer from that. On the other hand, the dog has a terrific mutt constitution, and has had minimal veterinary expenses (although she has had some behavioral ones -- are psycho-pharmaceuticals covered under insurance?) So, based on our experience, we'd probably lean towards catastrophic only (and watch our next one get Crohn's disease)

  • 06/23/2011 06:36pm


    Some companies do cover behavioral conditions just like any other illness. Some have limited coverage and some don't cover it at all. You will just have to browse the company's website to see if it is covered. If it is they will usually mention it specifically since not every company does cover it. The best thing to do though is read a sample policy to be sure and get specifics on the coverage.

    The more in-depth we get into pet insurance each week with this blog it should become obvious that it is a complex subject and there are many factors to consider when selecting a company and policy for your pet.

  • 06/23/2011 11:10pm

    I THOUGHT I made a well informed decision when I first purchased pet insurance 7 years ago. However, I had no idea how much I didn’t know. I didn’t know dogs could have allergies or diabetes or other chronic ailments. Even if I had known, I was pretty clueless about the potential life time costs of these diseases. I had no idea that a $3,000 lifetime limit for the illness category of “Skin” would be so woefully inadequate. I reached that limit a couple of years and several infections ago. (And that is with a 70% reimbursement rate.)
    Along with your excellent advice of what to look for in an insurance policy, perhaps you could also develop a list of some of the more common illnesses and associated lifetime costs. My nine year old dog will probably be on Atopica for the rest of his life. At $50 - $60/month for the next 3 – 5 years, it is a significant expense. Plus the $5,000 or so already spent . . .

  • 06/24/2011 08:12am


    I ran across an article in the December, 2009 Veterinary Economics magazine. A study sponsored by Hills Pet Nutrition was conduced at the Michigan State University veterinary school.
    They looked at the annual costs of treating certain diseases in dogs and cats. Obviously, in June, 2011, the costs are even higher. This is an excerpt from the article:

    The cost totals don’t include examination fees, overnight hospital charges, or clinical pathology charges because these services are often related to other disease conditions. They do, however, include all other veterinary costs pet owners incurred at the teaching hospital during the 12 months after their pets were first diagnosed with the disease. To reduce the bias of referral case costs, the researchers selected patients whose owners used the university teaching hospital for both their primary and secondary care.

    Annual veterinary costs associated with canine diseases

    Median cost 25th percentile 75th percentile
    Heart disease $1,912 $953 $4,693
    Hypertension $1,700 $1,125 $3,273
    Osteoarthritis $1,656 $451 $3,242
    Cancer $2,447 $1,124 $6,502
    Diabetes $1,108 $387 $2,355
    Pancreatitis $1,422 $492 $2,120
    Obesity + torn ACL $2,367 $215 $3,137
    Chronic kidney disease$1,823 $1,078 $2,998

    Annual veterinary costs associated with feline diseases
    Median cost 25th percentile 75th percentile
    Heart disease $1,065 $387 $2,924
    Hypertension $1,241 $674 $2,253
    Osteoarthritis $286 $89 $2,581
    Cancer $994 $630 $2,308
    Diabetes $860 $531 $4,285
    Pancreatitis $1,483 $543 $3,072
    Chronic kidney disease$1,065 $562 $2,396
    Hyperthyroidism $1,401 $1,015 $4,034

    While not all of these diseases can be prevented through regular care, clients who participate in a wellness plan that includes periodic physical examinations and diagnostic testing are much more likely to learn of their pets’ condition early in its course and keep costs of treatment toward the lower end of the scale. Also, these numbers can help you make a convincing case for the value of pet insurance.


About Healthy Assurance

  • Dr Kenney, DVM
    Lisa Radosta, DVM, DACVB

    Doug Kenney practices small animal medicine and surgery at Houston Levee Animal Hospital in Cordova, Tennessee. He has a special interest in wellness care...

    Extended Bio