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How Does Pet Insurance Work?

Dana George
By: Dana George

Our Insurance Expert

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If you're curious about pet insurance, you're not alone. An estimated 85 million American families own at least one pet, and most of us love our dogs, cats, hamsters, snakes, and pot-bellied pigs like family. Pet health insurance is designed to help keep our pets healthy. Here, we uncover the ins and outs of how pet insurance works, what it covers, and how to find the right policy.

How does pet insurance work?

Like human health insurance, a pet insurance policy helps defray the cost of medical care for our animals. While no pet insurance plan pays 100% of all medical care, a good policy can minimize the amount of money spent. Better yet, the best pet insurance can mean the difference between getting the medical care our animals need and having to deny that care due to cost.

How to select the right policy

The pet policy you purchase should be tailored to the needs of your pets. For example, our two dogs have anxiety and separation issues. We needed a policy that was accepted in enough places that we could shop around until we found a vet who didn't seem rushed and could take their time making our dogs feel safe.

Historically, our pets have lived long lives and we know how expensive caring for an older pet can be. A cranky 20-year-old cat with diabetes provided a particularly expensive illustration. We knew that we never wanted to be out that much for pet medications again.

For us, the "right" policy was one that allowed unlimited office visits to get things right while the pups were young and comprehensive healthcare coverage for when they're old. Let's say one of them develops hip dysplasia or treatable cancer. We looked for a policy that would provide a wide range of coverage, no matter what happens as they age.

Make a list of your concerns for your pet. That list will help you home in on a policy offering that type of pet insurance coverage. Once you have several companies that look like they'll meet your needs, you can compare pet insurance costs.

How to sign up for pet insurance

Most pet insurance providers offer more than one package. The least expensive provides the most basic coverage, while levels of coverage expand as package prices increase. Some companies offer online quotes, while others prefer you call.

Since I felt like I needed a touch of advice, I ended up calling for our pet policies. I was asked about a lot of things, including existing health issues. I was also asked about their ages. The primary reason I buy pet coverage as soon as I bring a new pet home is because I know it costs more to insure them as they get older.

Why does it cost more to insure an older pet?

Just as with humans, medical issues can become more complex as a pet ages. Arthritis, diabetes, and other health conditions can develop. Older pets may need more frequent trips to the vet and are more likely to require surgeries, expensive procedures that pull money from the bank.

Do all vets accept pet insurance?

We move relatively often. In fact, since bringing our 7-year-old pup home we've lived in three different states. I have yet to run across a vet who does not accept pet insurance. Still, the safe move is to ask about it when making an initial appointment. While you have them on the line, ask which policies are accepted.

And because I've used pet insurance regularly, I know to ask them how they want to be paid. Most prefer the veterinary bill to be paid in full upfront and have you file for reimbursement. What I've found in our area is that a few of the big vet offices have agreements with the larger, established pet insurance companies and will only charge me for my portion of the bill. The insurance company reimburses the rest directly to the vet's office.

What does pet insurance cover?

The most dizzying part of pet insurance is comparing policies side by side. Each company has a distinct list of what it covers and what it won't cover. For example, our pet insurance covers stem cell transplants and I believe it was the only company offering that coverage when I was shopping for insurance.

That said, most policies cover things like:


Say your cat gets a bite wound or your dog swallows a bottle cap. X-rays, MRIs, bloodwork, surgery, and other services related to the accident are covered.


Everything from UTIs to hypothyroidism and cancer is covered if you purchase a policy with illness coverage.

Chronic conditions

Some policies include coverage for chronic conditions in their standard policy. That means if your 20-year-old cat is diabetic and needs regular checkups, it will be covered


If your pet is sick or injured and needs a prescription, some pet insurance policies help cover the cost.

Hereditary and congenital conditions

Let's say your pet is a well-bred, full-blooded breed of animal. Like most breeds, it inherits some type of hereditary condition that doesn't show up until later in life. Things like heart disease, eye disorders, and hip dysplasia are more common in some breeds than others. This coverage may be offered as standard or as an optional rider.

These coverages are often offered as add-ons to a standard policy:

Alternative therapies

Alternative therapies can save you money if your dog needs rehabilitative therapy after surgery, physiotherapy, chiropractic care, acupuncture, or those stem cells I mentioned.

Behavioral issues

Some insurance companies offer treatment for things like pacing, chewing, and separation anxiety as part of their standard coverage. Other companies offer behavioral issue coverage as an add-on only.

What's not covered?

While there may be exceptions to the rule, the following are typically not covered by pet insurance plans:

Preventative care

Unless a pet insurance provider offers it as an optional add-on, preventative veterinary care, like vaccinations and flea and tick medication are not typically covered by pet insurance.

At the time we purchased wellness coverage for our dogs, we realized it was cheaper to cover their preventative care through the Wellness Plan offered through Banfield Pet Hospitals. I cannot overemphasize how much money it has saved us through the years. Between unlimited office visits and annual teeth cleaning, we spend far less through the Wellness Plan than we would spend if we paid for each service separately.

If you're interested in preventative care, the best move is to compare how much a company charges to add it to an existing policy to how much it would cost to enroll them in another wellness plan. It's okay to have more than one policy in play, particularly if it saves money.

Three other expenses that are not typically covered are:

  • Pre-existing conditions
  • Cosmetic procedures (like ear cropping or claw removal)
  • Breeding costs

Do I have to pay upfront?

Whether you must pay 100% upfront for services depends on the insurance company you choose and the veterinarian's office that cares for your pet.

How does reimbursement work?

Though procedures vary by carrier, normally, the pet insurance company provides you with forms for the vet to fill out following a visit or procedure. If a vet's office has a long-term relationship with an insurer, they may have the forms in their office. Once a claim is made, the insurance company mails a check to either you as the pet owner or the veterinarian.

As a pet parent, you likely have nothing but love for your animal companions. What makes pet insurance worth the cost of the policy is the way it allows you to care for those animals in the best way possible.

RELATED: Check out The Ascent's complete guide to pet insurance cost.


  • No, things like ear cropping and pre-existing conditions are not covered in a pet insurance quote. Also not covered are any riders you may want to add, like preventative care or help with behavioral issues.

  • If it's health-related, it's likely covered. For example, accidents, illnesses, and congenital conditions are typically covered.

  • Like auto or homeowners insurance, pet policies come with a deductible. This is the amount you have to pay toward the care of the pet. You get to choose your deductible when you pick a policy. The lower the deductible you choose, the more expensive the premium will be, but the less you will have to pay out of pocket when your pet needs care.

  • The best way to maximize pet insurance is to find a policy that fits your needs. For example, some dog breeds have more dental issues than others. If you have a dog with potential dental issues, make sure your insurance coverage will pay for dental cleanings, infections, etc.

Our Insurance Expert