Pet insurance is often stigmatized, especially when it comes to the U.S. There are a lot of stories online discussing claim denials, issues with the fine print, and people who say they paid for it for years and got nothing back.
This leads people to think it is a scam. However, it is not magic and it is not foolproof.
Pet insurance is not a charity, it is a financial product. Most of the frustration vanishes when people understand how pet insurance actually works. There is no frustration due to lack of understanding and disappointment happens quickly.
Let’s discuss the pet insurance industry and discuss how it can be used without regret.
Where the scam label comes from.
Most of the issues come from misaligned expectations. Many pet owners think insurance is like a savings account and they can expect to get back everything they spent. This is not the case for insurance, pet or human.
You are paying for the insurance to shield yourself from large, unexpected expenses, not to cover regular costs.
Another frequent complaint is about policy timing. Because of customer timing, policies are bought after signs of illness, i.e. dog limping, cat having kidney problems,… When they try to make a claim, they feel like they’ve been deceived since so much time has passed.
This falls under pre-existing conditions which all legitimate insurers will exclude.
Policy documents are also time consuming and tedious and lead people to feel a sense of frustration.
Pet insurance is not a scam. It is simply misunderstood.
How pet insurance works.
Pet insurance policies cover reimbursement of qualified pet insurance expenses.
Choose a plan with:
A monthly plan premium, a yearly deductible, Then a reimbursement rate, which is typically between 70 – 90 %.
Then there are coverage limits which are either per year or per lifetime.
Then, you go to the vet, pay the bill, submit a claim, and if the bill is covered, you will get reimbursed.
No more, no less. What is covered depends on the plan you choose.
Most accident and illness plans cover things like broken bones, infections, cancer treatment, emergency surgery, and chronic conditions diagnosed after enrollment.
These are the general exclusions:
- Pre-existing conditions
- Routine wellness unless you add a rider
- Grooming or cosmetic procedures
- Breeding-related costs
If that sounds restrictive, remember this. A single emergency surgery in the US can cost $4,000 to $8,000, while cancer treatment can exceed $10,000. Pet insurance exists to keep those moments from becoming financial disasters.
Real Situations Where Pet Insurance Pays Off
A young Labrador might swallow a sock. A typical cost for emergency surgery for this would be $6,500. With pet insurance, the typical plan covers 80 percent and has a $500 deductible. The pet owner would get back around $4,800.
Consider a middle-aged cat diagnosed with diabetes. The insurance plan pays off. It covers the costly ongoing medication, testing, and additional vet visits. It saves the owner thousands.
These are common scenarios. As the vet in the US, you often face heartbreaking decisions to remit the treatment because of the cost. Insurance doesn’t remove the stress, but it softens the blow.
Common Pitfalls That Make People Hate Pet Insurance
This is where things go wrong, and usually it’s avoidable.
Purchasing Pet Insurance Too Late
If your pet already shows some symptoms, insurance will not cover pet-related issues. Continuing to wait until an issue is present literally defeats the purpose of insurance, waiting until it feels like something is “off.”
The purpose of pet insurance is to cover your pet’s medical needs while your pet is still young and healthy. Straightforward, but not ideal.
Pet Insurance & Analytics
Most pet insurance providers offer some form of analytics, like tracking healthy moments.
Walking every day and going to the veterinarian every year is an example of analytics in pet insurance. Also, analytics in trust building a relationship with your pet.
Walking and exercising should be fresh to the pet every day to build a positive and healthy relationship. Most importantly, pet insurance will cover a healthy and risk-free pet.
Using the Cheapest Insurance
Once your pet gets a bit older and presents some symptoms, it will be almost impossible to cover your pet’s issues. Waiting too long defeats the purpose. Insuring your pet while it’s still young is a great purpose, but not something worth excitement.
If you know a bit about pet insurance policies, you will know that some plans cover hereditary conditions, and some simply do not.
Some plans cover waiting periods (i.e. plans that cover more conditions will have waiting periods), some plans cover max payouts per condition.
Standard pet insurance policies cover a huge gap, and in most cases, cover nothing after waiting periods. Pet insurance policies cover a huge gap, and in a dead field of services, insurance is the only thing that covers a huge gap.
Start With Your Risk Tolerance
Ask yourself the following question. If my pet needed a $7,000 surgery tomorrow, would I be able to pay for it?
If the answer is no, insurance makes sense. If the answer is yes, you still want insurance, and you could afford more risk with higher deductibles and coverage limits.
Compare Coverage, and Not Just Price
Consider the following:
What conditions are excluded
If they cover chronic illnesses over the long term
How much you can claim over a year or over a lifetime
How you would rate the insurance company in terms of claim processing
Reading reviews helps, but focus on the review to find issues, not a single angry user.
Enroll Early and Stay Consistent
You will get the most savings if you are covered for the long term. If you cancel and re-enroll later, you may end up starting over on waiting periods and reclassifying conditions as pre-existing.
People often underestimate the importance of consistency.
Keep Records
Vet notes, invoices, and clear documentation make claims easier to process. It may not seem like it, but it’ll save you a lot of time and effort in the long run.
Is Pet Insurance Worth It in the United States?
Yes, for the majority of American pet owners.
It’s very expensive to cover the wide array of services available to pets in the US. Insurance helps pet owners afford the best veterinary services.
Is it suitable for everyone? Certainly not. Some opt to self-insure by saving monthly. This works if you are disciplined and fortunate enough.
However, pet insurance skeptics ignore countless pet parents who avoided debt and tough decisions because they had insurance when it really mattered.
The Honest Bottom Line
Pet insurance isn’t a scam, and it isn’t perfect. It’s a tool.
When people feel burned, it’s usually because they expected it to work differently than it does. When used correctly, it does exactly what it promises. It reduces financial risk during serious health events.
Pet insurance may very well be the most sensible choice you make for your pet, but it’s the most practical.
This isn’t an emotional choice, and that’s the point. Sometimes, it’s just the sensible option you need.