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What is Pet Insurance?

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Statistics show that half of all households include at least one pet.

As a matter of fact, many people declare their pet is part of their family unit, and these pet owners want to give their furry companions the most comfortable and loving life.  

However, unconditional love is put to the test when their pets develop medical issues, and the vet bills accumulate. In some cases, a vet bill for one condition can total hundreds or thousands of dollars. Unexpected surgeries, like cancer or ligament tears, may cost $10,000 to $20,000; thus, many pet owners are faced with the horrible decision to put down their pets due to the vastly inflated costs.  

An insurance policy may literally make the difference between life and death, with some insurance policies covering most or all of that cost.  

There are twenty major pet insurance companies in North America, and they provide several types of coverage, pricing options, and limitations, so choosing the right policy can seem overwhelming.

Here are some key factors to consider when deciding which medical insurance works best for your pet.  

What Is Pet Insurance?

Pet insurance is coverage for veterinary bills due to unexpected accidents or illnesses of pets. Simply put, without pet insurance, you take up all the costs of the treatments. With pet insurance, you pay a monthly premium and have all or partial costs of the veterinary bill covered. 

All pet insurance plans use either a percentage of the invoice or a benefit schedule to calculate reimbursement. 

Pet insurance is not just a smart investment to make for older pets or unexpected injuries but also offers routine-care coverage.

Nowadays, pet insurance has expanded to include more comprehensive packages which provide preventive care (like vaccinations, and flea protection) or elective procedures (such as neutering). Dental care, prescription drugs, and alternative treatments, such as physiotherapy and acupuncture, are also covered by some providers.

You can opt for an accident-only package that does not cover illnesses, choose to add a preventive care package, or a more comprehensive package. 

Reimbursement Process

For almost all pet insurance policies, the owner must pay the bill first and then submit a claim with the insurance company. 

Keep in mind the time it might take to finish the claim ranges between providers. You want to look for a provider that will ensure an effortless way of submitting a claim, like online, email, fax, and whose average time of closing a claim is no longer than 30 days. 

Check to see how you would receive your payments. Typically, waiting for a check in the mail will take longer when compared to a direct bank deposit. 


Your premium will depend on the coverage you choose, your geographic location, and the species, breed, and age of your pet. 

  • Breeds 

Certain breeds are predisposed to have medical conditions, such as respiratory problems in Bulldogs, asthma in Siamese cats, and eye problems in Pugs. Medical insurance can still cover your pet and protect it even if they are prone to these inherited disorders or congenital disorders. 

  • Pre-existing conditions 

Most companies do not cover known pre-existing conditions, but they also identify these conditions differently, so your pet might still be eligible for a future claim. 

For example, the most common health problems dogs have are chronic ear infections or skin allergies, while in cats, it is lower urinary tract infections.

If your pet has any of these pre-existing conditions, it may still be a suitable candidate for insurance for an unrelated illness or injury. 

For insurance companies to avoid fraudulent claims, they will not allow the holder to file a sickness claim for 14 days after implementing the policy. Some providers may also require the pet to be examined by a vet first before they approve the policy to ensure there are no hidden pre-existing conditions. 

  • Age 

The age of your pet will be a factor that influences the cost to insure them.

Younger pets are cheaper to insure because they are not expected to have many health issues early on in their lives. However, that does not mean that older pets are not eligible for insurance, with some insurers providing coverage even for pets that are 14 years old. 

  • Location 

Places with higher density have a higher insurance cost, so the price may vary depending on your location. 

  • Species 

Even though 90% of pet insurance policies are taken out on cats and dogs, it is possible to buy coverage for a broader range of animals. Dogs cost more to insure than cats, with the average premium for dogs ranging from $25-65 and $12-36 for cats. 

Pet Insurance

Understanding Your Policy

Here is some common terminology that a pet owner needs to know when choosing a policy for their pet. 

  • Coverage 

Each insurance firm will provide various coverages that may include different schedules and limits.

To get the most value for your money, look for a firm that covers a wide selection of a typical veterinary bills. It should also cover your pet’s congenital and hereditary conditions and should have little to no limit to the amount they will cover. 

  • Premium 

Premiums are what you would need to pay monthly for your pet insurance.

However, this will change by type and breed of pet, location, age of the pet, and the selected coverage plan. While these monthly premiums can add up in a year, the amount is trivial compared to the tens of thousands you would otherwise have to pay in case of an emergency. 

  • Deductible 

A deductible is an amount you pay out-of-pocket when you make a claim before your insurance policy starts to pay some or all costs.

Select a deductible that is suitable for your budget. It is also essential that you know how they will be applied to any expenses occurred. Some deductibles are met yearly, while some can only be applied once per condition. 

  • Annual Coverage Limit 

This is the maximum amount an insurance company will reimburse you over a 12-month policy period. 

Pet Insurance Companies

Browse and compare 1000’s of vetted vendors. 

Final Insurance Checklist

Some important questions to check before you sign up for a policy: 

  • What is covered and even more importantly, take note of what is not covered? 
  • Whether congenital and hereditary conditions are covered? 
  • Whether there are any limits, either per accident, per year, or age? 
  • Is the policy flexible, easy to understand, and accepted in most vet clinics in your area? 
  • Are conditions that were diagnosed one year considered pre-existing the next year? 
  • Whether the deductible is on a per-incident or an annual basis? 
  • How the reimbursement is calculated (based on the actual vet bill or a benefit schedule? 

Regardless of which insurance you take up, it would be best to consider all the factors above.

Talking to your veterinarian may be the first insight needed to know your pet’s risks and history.

Armed with this knowledge and understanding and different types of insurance policies and how they work will allow you to make the best decision possible while at the same time being prudent with your finances. 

Written by Shortlister Editorial Team
Written by Shortlister Editorial Team