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Pet Insurance

Pet health insurance in the United States works by reimbursing pet owners partial cost of treatment.  There are not yet HMOs or network restrictions for pet insurance.  Banfield does have some sort of unlimited use program but Banfield is very limited in the treatment it provides and this is not insurance.

Pet health insurance is most suitable for pet owners who want to be able to spend a large amount of money on pet care, but lack the funds.

Before buying any policy, please spend time at  At the very least, it shows many people who buy pet insurance did not understand the policies and were disappointed when a claim was made.  The reviews here seem to be honest.

Key items to look for in an insurance policy:

  • High coverage, such as at least $5,000 per year
  • Coverage for genetic conditions (not pre existing)
  • No sub limits, such as per condition limits or a set payment schedule

High Coverage

The purpose of insurance is to pay for coverage you otherwise could not afford.

Compare two policies both costing $150 per year:

  • $500 in yearly coverage, with a $50 deductible
  • $5,000 in yearly coverage, with a $500 deductible

In the first case, the cost is $150 for $450 in coverage, not a great deal.  $500 in coverage would not cover many major veterinary bills.  If you have a $1,000 treatment and only $500 in coverage, you may not be able to use the insurance.  If you can not afford to pay $500 out of savings, the best option is probably to save the $150 in premiums in a bank account.

Alternatively, $5,000 in yearly coverage would cover most major veterinary bills.  This costs $150 for $4,500 in coverage, a much better deal.

Genetic Conditions

Good pet insurance policies do cover genetic conditions, such as dysplasia and allergies.

No insurance can, or should, cover pre-existing conditions.  The point is to buy insurance before you have a claim, not after.

No Sub Limits

VPI is the first pet insurance company in the U.S.  VPI pays on a set, pre-determined schedule, ignoring what the policy holder actually pays.  It is remarkable some pet owners tolerate this, ignoring other insurers which reimburse based on what the policy holder has actually paid for treatment.

There is one policy which covers one or two claims per policy period.  The problem with this is, if you have a claim, you have to decide whether to submit the claim to the insurer, or pay it yourself and "hope" to have a more expensive claim during the same period.

Some policies have per incident limits.  The policy may offer $10,000 per year but only $2,500 per incident.  It does not make sense to choose a policy which limits this way while alternative insurers do not.

Routine Care Coverage

Routine care coverage rarely makes sense.  There is an administrative cost in processing any claim, so theoretically all routine care insurance plans should cost more than the beneifts they provide.

Embrace, however, has a Wellness Rewards Plan which pays an amount exceeding premium payments.  (Technically, this does not appear to be set up as insurance.)  Pet owners must have an insurance plan to be able to purchase a Wellness Rewards Plan.

  • $150 cost per year, for $200 in coverage
  • $300 cost per year. for $400 in coverage

There are few restrictions and this is the only routine care coverage we have found which makes sense, for the policy holder.  Is it sustainable?

Embrace & PetPlan

After examining all the insurers, the two which appear to offer the most coverage for the lowest cost are Embrace and PetPlan.

Embrace highlights some of the differences between policy providers.

This is not a suggestion to purchase insurance from these companies.  Many pet owners will never have a $5,000 claim and will be much better off saving premiums in a savings account.

Personally, I have chosen a high deductible, high limit plan from Embrace, combined with the Wellness Rewards Plan.  The net cost is very low.

Free Insurance When You Adopt A Pet

Be wary of free "gifts of insurance" when you adopt a pet.  Groups are almost always paid to market these plans, and the reviews on make it clear many people end up paying premiums and regret it.  At the least, groups should understand the policies they are encouraging pet adopters to buy, and disclose the financial payments made by the insurers, to the group.



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