As recently as 20 years ago, if a pet was seriously ill, treatment options were limited. Today, many of the options available to humans – transplants, cancer treatments and so on – are also available for pets.
Rather than choose between your pet’s well-being and your wallet, you may be considering pet health insurance. If you think buying a policy might be right for you, do plenty of research. Until 1997, the only company offering pet insurance was VPI, and it has the largest share of the market. But competition has been growing over the past five years, and now 11 companies offer coverage. Older pets – those past 7 to 10 years old – may not be eligible for a new policy, so getting a policy when your pet is a pup (or a kitten) is the way to go.
When you’re shopping policies, the first thing to look at is how a company pays out claims. The higher the maximum payouts, the pricier the premiums. VPI, for example, reimburses according to a set schedule of benefits. That means that for each diagnosis there’s a ceiling on the amount you can be reimbursed, and the plan pays 90 percent of the allowed amount. In return, premiums are fairly inexpensive. (As when you use your own health insurance out of network, you pay the vet directly and submit your bill for reimbursement.) Many of the newer companies pay a percentage of your vet bill, up to 90 percent.
Be sure you understand the deductibles and maximums. Deductibles can be annual, per visit or per incident (say, if Fluffy gets hit by a car and requires multiple vet visits). Plans may have annual maximums that limit the payout per year, or they may have per-incident maximums. For older pets and pets with higher-risk lifestyles – cats that live outdoors or dogs that are allowed to roam, for example – look for policies with higher maximums because it’s more likely those pets will have higher expenses.
Many pet insurers offer a wellness plan as a rider to a policy that covers injury and illness. Wellness plans cover routine care, such as physical exams, flea-and-tick and heartworm medications, vaccinations, and regular testing. You’ll be reimbursed based on a schedule – say, $20 to $50 for a physical exam.
Preexisting conditions are never covered, says Michael Hemstreet, editor of PetInsuranceReview.com. Hereditary disorders – such as hip dysplasia in golden retrievers and kidney disease in Persian cats – are generally not covered, either. Ask how the insurer handles chronic conditions, such as epilepsy in dogs and asthma in cats. Those issues will likely require numerous vet visits.Jessica Anderson is an associate editor at Kiplinger’s Personal Finance magazine. Send your questions and comments to email@example.com. And for more on this and similar money topics, visit Kiplinger.com.