Pet Insurance: Makes Sense, Saves Cents

By VLADIMIR NEGRON

January 27, 2009

If you’ve ever taken your animal to a veterinarian, you know how astronomical the costs can be. In the past five years, veterinary costs have jumped by over 70 percent, reaching a high of about $19 billion last year, according to Pet Insurance Review, a Web site for comparative pet insurance shopping. Worse yet, less than one percent of pets are insured in the United States, according to Associated Press reports.

Fortunately, there are options for those seeking health coverage for their cats or dogs. What exactly will this coverage provide for you? The simple answer is: it depends.

Similar to health insurance policies for humans, plans for pets vary, including:

• Traditional plans. You pay a monthly premium to the insurance carrier, which typically covers illnesses, accidents, and occasionally preventative care, such as vaccinations and wellness exams. The insurance company pays part or all of the bill when your pet receives treatment covered under the plan. The cost of the plan will depend on how comprehensive the coverage is.
• Accident-only plans.  As the name implies, only accidents are covered; does not cover illness or wellness exams.
• Customizable plans. Similar to traditional plans, but you are allowed to customize the levels of coverage and what is actually covered under the plan. Cost will be dependent on the specific coverage.
• Discount plans.  You pay a fee to access a network of veterinarian; then, as long as you use an “in-network” veterinarian, your bill will be discounted by the agreed upon percentage.

On average, the cost of insuring a dog in the U.S. is about $35 per month; cats are about $25 per month. The costs are dependent on a variety of factors, including the amount of coverage and the pet’s age. A traditional plan generally covers about 80 percent of the pet’s medical bills, including routine checkups, tests, and vaccinations. Deductibles, meanwhile, range from $50 to $250. However, there are also numerous restrictions to be aware of, especially if you have a dog or cat breed that is associated with genetic medical issues.

There are currently 13 major pet insurance plans available in the U.S. (another 7 in Canada), and some may limit the total amount of coverage available, either annually or for the life of the pet. Annual caps typically range from $7,000 to $12,000. In addition, most insurance companies do not cover a pre-existing condition in a pet.

Policies, loaded with legalese, may be difficult to understand, but most pet health insurance Web sites break the coverage down into digestible bites, and provide their own 1-800 consumer number should you have any questions that have not been answered. “Do your research, read the terms and conditions, and choose a policy that fits you and your pet’s needs,” says Michael Hemstreet, founder and president of Pet Insurance Review.

Though pet insurance is not for everyone, the peace of mind to focus on your pet’s care rather than being distracted by exorbitant veterinary bills is immeasurable. “If you are someone who can’t stand the thought of putting your pet down because you can’t afford necessary veterinary care, pet insurance is for you,” says Hemstreet.