Do You Need Pet Insurance? Here’s How to Decide

Most pet owners will go out of their way to ensure their pets receive the best possible care. This includes taking the time to get them to the veterinarian's office for wellness checkups and shots, providing nutritious food and fresh water, and providing a comfortable place to sleep. None of these necessities are cheap, but most animal lovers believe their pet is well worth the investment.

Unfortunately, the cost of owning a pet can skyrocket if your pet becomes ill or is diagnosed with a chronic condition. And, in many cases, these costs will sneak up on you with little or no warning, leaving you with no time to prepare your finances. According to the American Veterinary Medical Foundation, as veterinary medicine becomes more technologically advanced, costs can and will rise even further.

One way animal lovers can help defray these costs is to purchase pet insurance, which is similar to health insurance for humans. You typically pay a monthly premium for a certain level of coverage, as well as a deductible if you need to file a claim. While pet insurance is not cheap, it can often save you from having to pay exorbitant medical bills if your pet becomes ill or injured unexpectedly.

And, whether we like it or not, none of us can predict whether our pet will be hit by a car, develop cancer, or swallow a sock.

Do You Require Pet Insurance?

While it appears that at least some people do not believe pet insurance can possibly be a good value, we wanted to speak with people who have purchased pet insurance and filed claims. Sylvia Inks of Raleigh, North Carolina, is one such customer, having filed $3,300 in claims for her dog through her ASPCA pet insurance policy since 2011.

According to Inks, her ASPCA Level 2 coverage covers accidents and illnesses with a $100 annual deductible, a $3,000 incident limit, and a 20% co-insurance requirement. Her policy, however, excludes congenital and hereditary care, continuing care, and wellness care.

When Inks first purchased her policy in 2008, she had heard and read about people who were dissatisfied with their plans. As a result, she inquired with her veterinarian about which insurance companies they use and trust. That's how she ended up purchasing a policy from the ASPCA.

While Inks only has $3,000 in coverage per incident, she says it is sufficient for her needs and has been a "great experience." Almost every time she filed a claim, she was reimbursed within 30 days. Furthermore, the process is far simpler and faster now than it was when she first purchased her policy in 2008. Previously, you had to mail the claim form and vet receipt to the ASPCA, but now you can file the entire claim online.

“All I have to do is provide information such as where my pet received treatment, when my pet was treated, how much I am claiming, what type of claim, describe why I took my pet to the veterinarian, and upload the invoice file and medical records,” she says.

Unfortunately, not every customer has a positive experience with their pet insurance, even if they use the same insurer as Inks. Some customers of ASPCA pet insurance and other providers have complained online that service is poor or that claims are processed slowly. Almost every pet insurance provider has customers who complain about "fine print" they didn't read in their policies and how their coverage didn't kick in to help with their pet's medical bills.

For this and other reasons, it pays to be meticulous about the details when shopping for a pet insurance policy.

How to Buy Pet Insurance

According to Sa El, co-founder of Simply Insurance, an online company that offers pet insurance as well as other insurance products, there are numerous details to consider when comparing pet insurance policies to find the best option for your needs. The cost of the policy should be considered, but you should also conduct due diligence to ensure that you understand what your policy covers. Here are some things to think about as you shop:

Pre-existing conditions: According to El, the most important detail to consider is whether or not your pet has any pre-existing conditions. Pet insurance will not help you if your pet is older and has had multiple surgeries or has a chronic medical condition, because pet insurance companies do not cover pre-existing medical conditions.
Age: If your pet is older and in good health, you can still purchase pet insurance — just at a higher cost, because your premiums will be adjusted to account for the increased risk associated with your pet's age.
Coverage limits: “Some companies provide unlimited benefits, while others limit you to $5,000 or $10,000 in covered benefits per year,” El explains. While you will most likely pay more for a policy with an unlimited benefit, these more robust policies can be a lifesaver if your pet requires particularly costly veterinarian care.
Coverage exclusions: While most pet insurance companies do not cover pre-existing conditions, they do have a list of excluded conditions that they will not cover under any circumstances. Some policies may cover wellness care while others do not, and it is your responsibility to understand what your policy includes and excludes. The insurance provider should “clearly spell out to you the details, including the limitations and exclusions, of coverage for routine and/or wellness care, as well as emergency treatments and conditions that require extensive care,” according to the AMVA.
Reimbursement level: Some pet insurance policies reimburse you for 100 percent of your pet's medical bills after your deductible up to the policy limit, whereas others offer an 80/20 or 70/30 reimbursement structure. Make sure you're aware of this ahead of time so you know how much you're responsible for.
Claims process: El recommends looking for a company that will either pay the vet bill directly or has a very quick claims process for sending out your reimbursement when you have to file a claim. If you don't, you might find yourself in a situation where you have to pay your vet bills up front and then wait what seems like an eternity for them to be reimbursed.
Monthly premiums: After you've compared the aforementioned criteria, make sure to compare monthly premiums to find the best deal. With this in mind, it's a good idea to compare policies and coverage costs with at least three or four different providers.