Different Types of Pet Insurance Explained

If you have a dog or cat, you probably visit the veterinarian on a regular basis — and boy it can be expensive, especially when an illness or emergency necessitates tests or surgery. That’s where pet insurance can be super valuable as it helps cover many of these costs. But which type of coverage is best for you and your pet?

Pet health insurance works in a similar manner to human health insurance policies, in that they both include annual premiums, deductibles, co-pays, and caps. And also like human insurance, your policy cost can vary widely with the level of coverage and even individual pets. For example, older animals often cost more to cover (which is why some providers have age limits). There may also be exclusions for pre-existing conditions, and some insurers may not cover certain breeds prone to hereditary conditions (e.g. hip dysplasia).

Navigating the world of pet insurance can be a complex journey. Whether you’re a new pet parent or looking to switch plans, understanding your pet insurance options will help you make an informed decision. When shopping around, it’s important to note the different types of pet insurance plans available, the benefits of each, and how to choose the best plan for your pet’s specific needs.

What are the benefits of pet insurance?

There are a lot of different reasons people get pet insurance. Nevertheless, the most common include:

• Financial safety — Pet insurance acts as a safety net to cover costly expenses that may arise when your pet falls ill or requires urgent medical treatment.
• Protection from unforeseen mishaps — Even young, healthy pets can meet with an accident or sudden illness unexpectedly. A pet health insurance policy can cover such unforeseen circumstances, saving you from potentially significant financial burdens.
• Exclusive benefits — Certain pet insurance companies offer exclusive benefits, such as coverage for holistic treatments along with damages your pet may cause to third parties or their property. Additionally, these policies can be helpful if your pet gets lost or stolen.
• Premium veterinary care — While many pet owners have to pick and choose their pet’s treatments based on cost, pet insurance coverage allows you to seek out the best care available or even additional treatment for your pet without basing your entire decision on finances.

Types of pet insurance coverage

Pet insurance policies can come in several forms, but most fall into three main categories: accident-only plans, comprehensive plans, and wellness or preventative care. Choosing the right type depends on your pet’s health, age, and your financial goals.

Accident-only plans

These plans (often called emergency pet insurance plans) provide coverage for unexpected injuries and emergencies such as broken bones, bite wounds, and poisonings. They are generally more affordable than comprehensive plans as they do not cover illnesses or chronic conditions such as parvo or hip dysplasia.

Comprehensive plans

Comprehensive plans cover both accidents and illnesses, ranging from minor issues like ear infections and UTIs to major conditions like cancer or diabetes. These plans are more expensive but offer broader protection, making them especially ideal for breeds prone to specific health issues.

Wellness or preventative care

Wellness plans are designed to cover routine care, such as vaccinations, annual check-ups, and flea and tick prevention. These plans can be purchased separately or as an add-on to many comprehensive insurance plans, or through certain veterinary hospitals, helping to manage the costs of regular vet visits.

Other things that affect your plan

It’s not just about the type of pet insurance you select — individual plans often vary further when looking at the nitty-gritty details. So, when choosing a plan, it’s crucial to understand the terms and benefits associated with each policy.

• Deductibles, premiums, and co-pays — Understanding how deductibles, premiums, and co-pays work can help you make more prudent financial decisions. For example, a higher deductible usually means a lower monthly premium, but you’ll pay more out-of-pocket upfront (until the deductible is met at least).
• Coverage limits and exclusions — Be aware of the coverage limits and what is not covered under your plan. Some policies may have breed-specific exclusions or do not cover pre-existing conditions, which can significantly impact your coverage.
• Reimbursement levels— Most pet insurance plans reimburse you for a percentage of the bill after deductibles are met. (Though Trupanion can pay your bill right at checkout!) Be sure to choose a reimbursement level that balances affordability with the level of coverage you need.
• Coverage term— Pet insurance policies typically offer monthly or annual coverage terms. And, in many cases, this means your coverage can change (or be cancelled — see below) at the start of each new term. Trupanion is different in that plans are paid for monthly but designed for the life of a pet. This means that deductibles, when applicable, are only paid once per condition for life (not annually like many other providers), and the extent of coverage does not change from month to month or year to year.
• Cancellation policies— Some pet insurance providers hold the right to cancel your coverage at any time for reasons that may not be in your control (Trupanion, however, will only cancel member policies in rare cases like non-payment, customer fraud, etc.). It's therefore very important to read the fine print before signing up.

How to choose the right type of pet insurance

Even if you’re sure about what kind of pet insurance coverage you want, it’s a good idea to avoid just jumping on the first plan you come across. There are three important steps worth taking to ensure you’re getting the most out of your pet’s coverage.

1. Look at your pet’s health risks

Consider your pet’s breed, age, and existing health conditions. Some breeds are more prone to certain illnesses, which might necessitate a comprehensive plan.

2. Compare insurance providers

Look at several pet insurance providers to compare plans, benefits, and customer reviews. This comparison will help you find a policy that offers the best value and coverage for your pet.

3. Consider future veterinary needs

Think about potential future health needs, including breed-specific issues that may arise as your pet ages. Planning for the future can save you considerable stress and financial strain.

Empower your pet care decisions

Understanding pet insurance is a vital part of pet ownership that can help with unexpected veterinary bills. By choosing the right type of insurance and familiarizing yourself with the terms and benefits of your policy, you can provide your pet with the best possible care throughout their life.