5 Things You Must Know Before Buying Pet Insurance

Pet insurance is financial protection for pet owners that help cover veterinary care costs. Its purpose is to alleviate the financial burden of unexpected medical bills for your pet. 

Similar to human health insurance, pet insurance plans cover a portion of the costs for services like injuries, illnesses, surgeries, x-rays, hospitalization, prescriptions, and more. This allows pet owners to focus on their pet’s health and recovery instead of worrying about the expense.

Pet insurance works by spreading the risks and costs over an entire pool of insured pets. Monthly premiums paid by all policyholders go towards covering the medical claims made against the insurance provider. In return for these premiums, you receive reimbursement for eligible vet expenses outlined in your policy.

Pet insurance aims to make veterinary care more accessible and affordable, as the costs continue rising every year. Policies give pet owners peace of mind that they can properly care for their furry family members in the event of a medical emergency without financial hardship.


Pet insurance originally started in Sweden in the late 1800s. Horses were the first animals to be insured, as they were valuable working animals at the time. The first pet insurance policy for a dog was issued in 1890. 

Pet insurance remained relatively obscure until the 1980s when it started to become more popular in Sweden. Other European countries like the UK began offering pet insurance around this time as well. 

The first pet insurance policy in the United States was issued in 1982 by VPI (Veterinary Pet Insurance). However, pet insurance didn’t really take off in the US until the 2000s and 2010s. As veterinary care became more advanced and therefore more expensive, pet insurance became an attractive option for many pet owners who wanted to budget for surprise vet bills.

Today pet insurance is offered by many providers in the US and UK. It continues to increase in popularity as a way for pet owners to manage the costs of veterinary care. Premiums and plans can vary widely, but most pet insurance today operates on a reimbursement model.

How Pet Insurance Works

Pet insurance provides financial assistance for veterinary costs by reimbursing you for eligible medical expenses related to your pet’s illness or injury. Here’s an overview of how pet insurance typically works:

  • Purchase a policy: You purchase a pet insurance policy from a provider and pay a monthly premium. Policies vary, but most reimburse 70-90% of covered costs after you meet an annual deductible.  
  • Submit claims: When you bring your pet to the vet, you pay the bill upfront as normal. Then you submit a claim to your provider with the invoice showing the diagnosis, treatment cost, veterinarian information, and other details.
  • Get reimbursed: Your provider reviews the claim and reimburses you a percentage of the costs based on your policy details. Reimbursements are usually sent within 2 weeks via check or direct deposit.
  • Renew annually: Your policy renews each year and you continue paying premiums. Most plans have an annual coverage limit, which resets at renewal so you can resubmit additional claims.

Some key things to know:

  • You can visit any licensed veterinarian or specialty clinic. Pet insurance doesn’t dictate where you can bring your pet.
  • Pre-existing conditions are typically not covered. Illnesses or injuries your pet had prior to enrollment are excluded.  
  • Routine preventive care like vaccines or wellness exams are not covered. Pet insurance is for unexpected illnesses and injuries.

So in summary, pet insurance alleviates financial stress when your pet needs expensive medical care. By submitting a claim after paying the vet bill, you can recover most of the costs for covered services.

Types of Coverage  

Pet insurance plans can cover a wide variety of medical expenses for your pet. The main types of coverage include:

Accident and Injury Coverage

This covers unexpected injuries and accidents like broken bones, bites, cuts, and poisonings. It reimburses you for costs related to surgeries, hospital stays, X-rays, medications, and other treatments needed to care for your pet after an injury. Accident coverage often has no annual or lifetime limits.

Illness Coverage 

This covers conditions like cancer, diabetes, digestive issues, allergies, and more. It helps pay for expenses involved in diagnosing and treating illnesses. Some plans cover hereditary and congenital conditions while others exclude pre-existing conditions. Illness coverage often has annual and lifetime limits.

Routine Care Coverage

This optional add-on reimburses part of the costs for regular veterinary services like vaccines, checkups, teeth cleanings, deworming, flea control, and more. It helps offset a portion of routine care costs to keep pets healthy. Some insurers cap annual payouts for routine care.

Having coverage for accidents/injuries, illnesses, and routine care can provide valuable protection against unpredictable and expensive vet bills. When choosing a policy, understand what’s covered and what limitations may apply.


The cost of pet insurance is primarily made up of premiums, deductibles, and reimbursement percentages. 


Premiums are the monthly or annual amount you pay for the pet insurance policy. Premium can range anywhere from $10 to $100+ per month depending on the age of your pet, breed, location, plan type, and amount of coverage. Typically premiums increase as your pet ages. Some pet insurance companies also increase premiums based on inflation and rising veterinary costs each year.


The deductible is the annual amount you must pay out-of-pocket per condition before the insurance coverage kicks in. Deductibles typically range from $100 to $1,000. With a higher deductible, your premiums will be lower but you’ll have higher out-of-pocket costs when you make a claim. With a lower deductible, premiums are higher but you’ll have lower out-of-pocket costs when making a claim.

Reimbursement Percentage 

The reimbursement percentage is the amount of the veterinary bill, minus the deductible, that the insurance company pays. This usually ranges from 70% to 90%. A 90% reimbursement policy will have higher premiums but leave you with less out-of-pocket costs when making a claim. A 70% reimbursement policy will have lower premiums but you’ll pay more out-of-pocket per claim.

The combination of premiums, deductibles, and reimbursement percentages determines the total cost of the pet insurance plan. It’s important to look at all three factors when choosing a policy to find the right balance for your budget and needs.

Top Providers

The top pet insurance providers in the United States include Nationwide, Trupanion, ASPCA, Healthy Paws, and Embrace.

  • Nationwide is one of the largest pet insurers in the country. They offer wellness coverage, accident and illness coverage, and even exotic pet insurance. Customers can choose an annual limit of $5,000 to unlimited coverage. Their plans do not restrict coverage based on breed or age. 
  • Trupanion is known for offering 90% reimbursement on veterinary bills. They have no caps on per-incident or lifetime payouts. Trupanion also covers hereditary and congenital conditions. However, they do not offer wellness coverage.
  • ASPCA works with Crum & Forster to provide comprehensive accident and illness insurance. Their plans have an annual limit of $5,000 or $10,000. Preventative care and routine exams are not covered. ASPCA does not restrict plans based on pet breed.
  • Healthy Paws has unlimited annual payouts and no restrictions around breed or age. Their accident and illness plans come with a $250 or $500 deductible. Healthy Paws is endorsed by the Pet Rescue Professionals Alliance.
  • Embrace is one of the few companies that lets customers customize their annual limit and reimbursement percentage. They have no caps for illnesses or accidents. Embrace also covers alternative therapies like acupuncture and rehab. Their policy requires just a 15-day waiting period.

When choosing pet insurance, it’s important to read policy details closely and make sure your vet accepts the provider. Consider whether wellness coverage is worth the additional premium. Also, check companies’ reputations for ease of claims and customer service.

Pros and Cons

Getting pet insurance can provide valuable protection, but also involves tradeoffs to consider. Here are some of the key benefits and drawbacks of pet insurance:


  • Covers expensive veterinary costs – This is the main advantage. Pet insurance can cover a portion of surgery, hospitalization, lab tests, chronic conditions, and more. This can save thousands in unexpected vet bills.
  • Provides peace of mind – Knowing you have insurance to help cover catastrophic pet illnesses or injuries can provide comfort and reduce stress as a pet owner.
  • Allows for better care – The ability to say “yes” to recommended treatment because cost is less of an obstacle.  
  • Customizable plans – Policies can be tailored to your budget and needs, with choices for annual limits, deductibles, and percentage of reimbursement.


Added expense – Premiums are an additional ongoing cost, averaging $30-70 per month depending on factors like breed, age, location, etc.

Pre-existing conditions excluded – Most plans don’t cover pre-existing conditions, so they are best purchased when pets are young and healthy.

Reimbursement model – You pay upfront vet costs and then submit claims for reimbursement, rather than fees being directly paid like human health insurance.

Not accepted everywhere – Some vets do not accept insurance, limiting in-network options for treatment.

Paperwork hassles – Claim paperwork and follow-up can be time-consuming and frustrating.

Overall, pet insurance can provide valuable financial protection against unpredictable pet illnesses and accidents. But it also involves extra costs and administration to weigh against the potential benefits.

Who Needs It

When evaluating whether pet insurance is right for you, there are a few key factors to consider:

  • Age of your pet– Pet insurance costs more as pets get older, so it pays to start when they are young. Getting coverage for puppies and kittens will help avoid future exclusions for pre-existing conditions.  
  • Breed and health history – Some breeds are more prone to medical issues like hip dysplasia or hereditary diseases. Review your pet’s medical history and breed disposition to assess future risks.
  • Your financial situation – Pet owners with limited savings may benefit most from insurance to defray large vet bills. Compare the peace of mind of coverage vs. self-insuring and budgeting for average pet healthcare costs.
  • Coverage of wellness care – While many plans cover accidents/illnesses, routine wellness care like vaccines often requires separate coverage. If your pet needs frequent vet visits, this can provide savings.

Ability to handle unexpected costs – For healthy pets with an owner who has an emergency fund, insurance may not make sense. But coverage protects against unforeseen accidents and illnesses that require expensive treatment.

Desire for complete care – Some pet parents want access to the best treatment options, like advanced diagnostics and specialized surgeries, if their pet gets sick or injured. For comprehensive care, insurance is advisable.

Take stock of your pet’s expected medical needs and your own financial capability to handle them. For pets at higher risk or households on a tight budget, insurance can be a prudent safeguard. Compare plans to find an optimal balance of coverage and affordability.

Claims Process

Filing and managing claims is a key part of utilizing pet insurance. Here’s what you need to know about the claims process:

  • Keep records – Be sure to keep all receipts, invoices, and documentation related to your pet’s care. These records will be required to file claims. Take photos of invoices or scans of receipts for easy record-keeping.
  • File quickly – Claims should be filed as soon as possible after treatment. Many pet insurance companies require claims be filed within 90 days. The quicker you file, the quicker you’ll be reimbursed.
  • Online portal – Most pet insurers have online portals where you can conveniently upload documentation and track claims. This makes filing faster and easier.
  • Reimbursement options – You’ll be reimbursed via check or direct deposit. Direct deposit gets you reimbursed quicker, though some insurers charge a fee for it.
  • Explanation of benefits – You’ll receive an explanation of benefits detailing how much was covered, the amount reimbursed, and reasons for any denial of reimbursement. Review this closely.
  • Appeal denials – If a claim is denied and you disagree, you can appeal. Provide additional documentation or rationale for why it should be covered. The success of appeals varies.
  • Multiple treatments – If treatment spans multiple visits, you can file one claim encompassing all visits or individual claims for each date of service. 

Pre-approvals – Some treatments like surgery may require pre-approval. This guarantees coverage before proceeding. Check on pre-approval requirements before major treatments.

Properly filing claims and understanding the process is key to maximizing your pet insurance benefits. Keep detailed records, file quickly, and follow up on denials to get the most out of your policy.


Pet insurance can provide invaluable financial protection and peace of mind for pet owners. When reviewing plans, be sure to read the fine print and understand exactly what is and isn’t covered. Key factors to consider are deductibles, reimbursement rates, covered services, exclusions, and limits. 

For most pet owners, an accident and illness plan that covers both accidents/injuries as well as common illnesses will provide adequate coverage. Accident-only plans leave out many conditions that could prove very costly over a pet’s lifetime. Maximum annual or per-condition limits are also important, as large vet bills can easily exceed $10,000. Higher reimbursement rates of 90% or more are ideal if within your budget.

Working with a top-rated provider like Healthy Paws, Petplan, or Trupanion can ensure reliable customer service and claims payments. Their plans offer robust coverage with 70-90% reimbursement and annual limits of $10,000 or more. 

Ultimately, pet insurance is worth considering for most pet parents. It enables you to make healthcare decisions based on your pet’s needs, not your wallet. The peace of mind and financial protection pet insurance provides are invaluable should your furry family member have an accident, injury, or illness.

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