Critter Care 101: Understanding the Basics of Pet Insurance
In 2022, the cost of veterinary care rose by 10%. As a result, more pet parents have started looking into ways to make caring for their animal companions more affordable. Pet insurance is an option that’s rising in popularity, with a 28% increase in signups between 2020 and 2021.
But what exactly is pet insurance for, and how does it work? If you’re asking questions like these, here’s what you need to know about pet insurance.
What Is Pet Insurance For?
Pet insurance is a form of healthcare coverage designed specifically for household pets, typically dogs and cats. There are several different types of pet insurance. Some policies cover costs explicitly related to accidents or mishaps, while others also include coverage for illnesses. There are also wellness policies – also called preventative care policies – that focus on more routine veterinary expenses, such as vaccinations.
How Does Pet Insurance Work?
Pet insurance works in a relatively straightforward manner. First, you sign up for a policy with an insurer. That allows you to share details about your pet, choose your coverage type, set your deductible, and learn about the monthly premium from the beginning. Once you have a policy, you pay the monthly premium to maintain the coverage.
If your pet experiences a qualifying incident that leads to a vet bill, what happens next may vary by insurer. Many pet insurance companies use the reimbursement method. With that, you initially pay the cost out of pocket to your vet and then file a claim with your pet insurance company. After the claim is processed, you’ll get a payment from the insurer based on the coverage level if the expense is covered by your policy.
Some insurers use a different approach, primarily by paying the vet directly for the covered expenses. This option limits your need to spend money up front, which is beneficial if you don’t have much set aside for unexpected costs.
In either case, you do have to pay a deductible before the coverage kicks in, the amount of which can vary. Some policies may have $0 deductibles, while others may get as high as $1,000.
What Does Pet Insurance Usually Cover?
What pet insurance covers varies by policy type. Accident-only coverage usually includes injuries related to accidents or mishaps. Along with diagnostic care to learn more about the nature of the injuries, the costs of treatment and related prescriptions are typically included.
Accident and illness policies are more comprehensive. Along with accident coverage, as described above, this also includes diagnosing and treating a variety of illnesses, such as infections. Conditions like cancer are also potentially covered.
With wellness policies, specific routine veterinary care is handled by the plan. That can include annual vaccinations, flea and tick medication, deworming, and similar standard services. While getting a wellness policy separately is an option in some cases, it’s far more common to see this as an add-on or rider for one of the other policy types discussed above.
However, it’s critical to note that every policy is different, so coverage limitations and restrictions vary. As a result, it’s essential to read the details of a policy before signing up, ensuring you fully understand what is and isn’t covered.
