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Do You Need Pet Insurance?

You love your pets and would do anything to keep them safe. But you'd probably prefer that you not break the bank in the process. Pet insurance can help you keep your animal healthy by covering some of the costs related to their care, including checkups, vaccinations and even emergency surgeries.

Pet insurance policies vary by provider, though there are typically different tiers you can choose to match your budget. However, pet insurance applies only to future needs and issues. That means you won't be able to take out a policy that covers any illnesses your pet developed before you secured coverage (preexisting conditions).

What Does Pet Insurance Cover?

Pet insurance helps you afford your pet's medical expenses, though the extent of your coverage depends on the plan you choose. In most cases, you pay for your pet's treatment upfront and the insurance company will reimburse you for qualifying costs.

There are three common types of pet insurance:

  • Accident-only: An accident-only policy provides coverage if your pet is injured in a fight with another animal, breaks their bones, eats something toxic or is otherwise hurt.
  • Wellness: A wellness plan covers routine care, such as checkups and vaccinations. Depending on the type of pet you have and the insurer you choose, wellness coverage may also include deworming and spaying or neutering.
  • Accident/illness: This type of plan covers your pet for injuries suffered in an accident, as well as sickness such as cancer or other diseases. It may include tests, specialist visits and surgeries.

Some pet insurance providers may allow you to combine a wellness plan with an accident or accident/illness plan to reduce your routine care expenses.

How each provider defines these categories is up to them, however, so one company might include more services under the wellness heading than others. For example, some insurers might reimburse you for grooming and nail trimmings. Others might see grooming as falling outside the wellness umbrella, in which case you'll need to pay for those costs out of pocket. Things like prescription food or medicated shampoo might also be covered by some plans and excluded from others.

If you decide to take out a pet insurance policy, it's often wise to request quotes from several providers to compare costs and coverage terms to find the best deal.

How to Decide if You Need Pet Insurance

Deciding whether to purchase pet insurance is a personal decision. Only you know your pet's needs and can gauge whether you'll need the coverage often enough to justify the premiums. But if you're on the fence, there are a few factors to consider:

  • Your pet's age: The older an animal gets, the greater the chances that they will develop an illness that requires tests, surgeries and even ongoing medication.
  • Your pet's overall health: If you know your pet is predisposed to a certain condition, or you've adopted an animal and aren't sure about its medical history, insurance can serve as a buffer against paying for unexpected health problems.
  • Your pet's breed: Some pet breeds are more prone to serious health issues than others, and treating them can cost thousands of dollars. Large dogs have increased risks of heart disease and arthritis, for example, while pugs are more likely than other breeds to suffer hip dysplasia. Meanwhile, mixed-breed dogs are often cheaper to insure than purebreds because they have a lower risk of genetic disorders, according to the North American Pet Health Insurance Association. Researching your pet's breed, or talking with your vet about common breed issues, may help you decide whether pet insurance is right for your situation.

Of course, these are just guidelines. Any pet can become ill or suffer serious injuries that require costly medical care. Embrace Pet Insurance found that intestinal issues were the most common claim for both cat and dog owners in 2018, with costs reaching $900 and $790, respectively. Other problems, such as feline leukemia or a ligament tear in your dog's legs, can cost several thousand dollars, according to Embrace.

There's also your own peace of mind to consider. Knowing you have insurance may put you at ease, and it can also alleviate financial stress when you're trying to make critical decisions about your pet's care.

Having pet insurance also may make you more willing to take advantage of things like checkups and grooming, making for a happier and healthier pet. If having pet insurance makes you more likely to engage in preventive care, you may save money by catching illnesses early and dealing with them before they require more long-term care or emergency intervention.

How Much Does Pet Insurance Cost?

The cost of your pet insurance will vary based on the type of plan you choose and the level of coverage you need. Progressive, for instance, offers plans that reimburse 70%, 80% or 90% of your vet costs after your deductible.

The deductible for pet insurance works the same way as it does with health or auto insurance. It's the amount of money you're required to spend out of pocket before your coverage kicks in. So, if your pet insurance deductible is $500, that's how much you'll need to put toward your animal's care before you can start receiving reimbursements. Sometimes you can lower your insurance premium―the monthly or annual fee you pay for the plan—by agreeing to a higher deductible.

A number of factors will affect your pet insurance, including:

  • Pet's age
  • Pet species and breed
  • Deductible
  • Type of plan you choose
  • Level of reimbursement coverage

Before you start shopping for policies, think about how much you can afford to pay in premiums, deductibles and other out-of-pockets costs. You may also want to make a list of the top services you want covered, as well as any medical issues you anticipate your pet facing. Those parameters will help you choose a plan after you receive quotes from providers.

Do Pet Insurers Check Credit Scores?

One thing that is unlikely to affect your rate is your credit. It's somewhat murky as to whether pet insurers will use credit scores in any form to determine your policy cost, but the elements listed above will play a far more significant role even if your credit is a factor.

Some states ban the practice of insurers using credit as a factor in insurance premiums, while others allow it. Some insurers in some states may use it as a factor in pet insurance. Regardless, it's always beneficial to maintain good credit by paying your bills on time and keeping your credit card balances low.

How to Shop Around for Pet Insurance

You can buy pet insurance from a company that specializes in pet policies or from traditional insurers that also offer policies such as homeowners or auto insurance. You may be able to get pet insurance through an existing insurer, and you may even get a discount for bundling it with your other plans.

Some animal organizations, such as the American Society for the Prevention of Cruelty to Animals (ASPCA) and the American Kennel Club (AKC), offer pet insurance as well.

While cost may play a role in your choice, it's important to take a comprehensive view of any offer. A few things to look out for:

  • Are there any coverage exclusions (meaning conditions that will not be covered)?
  • Does a wellness policy include grooming and other routine care?
  • Does the policy include dental cleanings or oral surgeries?
  • Is there a cutoff age for insuring older pets?
  • What are the coverage limits (meaning what is the maximum reimbursement)?
  • What is the monthly premium?
  • What is the deductible?

One plan may have an attractive low monthly premium, but if it doesn't offer protection for many of the services you expect your animal to need, it may not save you much money in the long run.

How to Save Money on Pet Insurance

If you opt to take out pet insurance, there are ways to reduce your overall costs.

  1. Pay a higher deductible. This can lower your monthly premiums, but you may want to create an emergency fund for your pet with enough money to cover the deductible in case he or she needs urgent, high-cost care.
  2. Look for a young pet. If you're still looking for a new pet and want to reduce your costs, getting a younger animal may help keep your premiums lower. An older animal may have age-related issues, so insurers typically charge more to cover them.
  3. Look for deals. Talk with your current insurance provider about whether they can give you a bundling discount or another deal on a pet policy. You may also want to call different insurers directly, rather than just getting online quotes, and asking about any discounts or deals they may provide that aren't advertised on their sites.

Paying attention to your animal's overall well-being can also help you save, not to mention give you more options when it comes to qualifying for insurance. Keeping your pet at their vet-recommended weight and making sure they get plenty of exercise and affection may also help them stay healthy. And the longer they are healthy and loved, the longer they will be your trusted companion and a joyful part of your life.