How to Buy Pet Insurance

Young woman lying on the floor with her dog and working online on laptop in the room at home

For many pet parents, there's almost nothing they wouldn't do for their fur babies. But the cost of caring for a pet isn't cheap. In fact, Americans spent nearly $36 billion on vet care and related products in 2022, according to the American Pet Products Association. Pet insurance can help offset the cost of your pet's medical bills.

But pricing, covered services and reimbursement rates vary. It's important to do your homework before purchasing coverage. Let's take a look at what you need to do to find a policy that fits your and your pet's needs.

1. Determine Which Type of Pet Insurance You Need

In general, you can choose from three types of pet insurance plans. Here's a brief overview of each.

  1. Wellness: Helps pay for preventive care to keep your pet healthy, such as annual check-ups, vaccinations and dental cleanings.
  2. Accident-only: Covers diagnostic procedures, such as ultrasounds and bloodwork, and treatment for injuries resulting from unexpected accidents, including falls, animal bites, car crashes or eating dangerous substances. It doesn't cover the cost of treating illnesses.
  3. Accident and illness: This type of plan provides coverage for diagnostic procedures and treatment for accidental injuries and illnesses.

2. Understand Insurance Policy Details

It's important to understand how pet insurance works before buying a policy. Here's a brief description of some of the most common pet insurance features you'll encounter.

  • Coinsurance: Coinsurance is the amount you have to pay for treatment after meeting your deductible. The most common coinsurance option pet owners choose is 10% or 20%, but you may be able to select amounts ranging from 0% to 40%, depending on the plan. If you opt to pay for a larger share of your pet's treatment costs, your premium will likely be lower.
  • Deductible: Deductibles for pet insurance vary by plan and often range from $100 to $500. Opting for a higher deductible usually lowers your premium but increases your out-of-pocket expenses if your pet needs treatment. Selecting a lower deductible increases your premium.
  • Exclusions: Pet insurance plans often exclude coverage for treatment related to pre-existing or hereditary conditions. Policies may also have other exclusions, so it's important to know what is and isn't covered before purchasing a plan.
  • Policy limits: Some policies may not cap the amount they reimburse you. Others have per-incident, annual or lifetime maximums. Once you reach this amount, the insurance company won't pay for any more of your pet's medical bills.
  • Premium: The average annual cost of an accident and illness policy in 2022 was about $640 for dogs and $387 for cats, according to the North American Pet Health Insurance Association. But rates can vary significantly among insurers because companies review many criteria to determine plan premiums, including pet breed, age and where you live. Some companies might even consider credit scores in pet insurance pricing, depending on your state.
  • Reimbursement percentage: When you purchase a plan, you get to select your reimbursement rate, which may range from 60% to 100%. Some plans reimburse you based on the treatment your pet receives. For example, a policy may cover 80% of the cost of surgery and 60% of the cost of prescription medication. Other policies reimburse you for a portion of your total out-of-pocket costs. Let's say you pay $2,000 in medical bills (after meeting your deductible), and your insurance plan has an 80% reimbursement rate. You'd get a check for $1,600 from the insurance company.
  • Renewal: Most pet insurance policies automatically renew after one year. When your plan renews, your deductible and plan maximums (except for lifetime maximums) reset. Your premium may also increase.
  • Waiting period: This is the amount of time following purchasing a policy that you must wait before your insurance company will pay for your pet's treatment. The waiting period for pet insurance plans is usually around two days for accidents, 14 days for illness and six months for orthopedic conditions.

3. Research Insurance Providers

Some traditional insurers offer pet insurance. If you already have home or auto insurance, checking with your current provider may be a good place to start. If not, you may find a policy that meets your needs through a specialty pet insurance company or nonprofit organization like the American Society for the Prevention of Cruelty to Animals (ASPCA) or the American Kennel Club (AKC).

4. Get Several Quotes

Before purchasing pet insurance, it's a good idea to get quotes from multiple providers. Pricing varies by breed, age, gender, insurer and other factors, and shopping around is a simple way to find the lowest rates for the coverage you need.

When comparing quotes, pay special attention to each policy's covered services, exclusions, reimbursement rates and plan maximums. A plan with an ultra-low premium may cost you more in the long run if it has a low reimbursement rate—or excludes coverage—for the services you use most. Depending on the age and health of your pet, it may be worth paying more for coverage to get additional protection.

5. Enroll in a Policy

When you've chosen the policy that's best for you, enrolling is simple. You can typically complete the entire process online. Just provide some basic information about you and your pet, including your ZIP code, the type of animal you have, your pet's breed, age and other information. Select the plan you want and pay for your policy.

The term for a typical pet insurance policy is 12 months, but most insurers don't require you to pay the entire premium upfront. You can usually make monthly, quarterly, semi-annual or annual payments.

You can use your pet insurance benefits after you pay for your policy and the waiting period is over. Most insurance companies require policyholders to pay for treatment upfront and submit a claim for reimbursement. Depending on the insurer, you may be able to submit a claim via mobile app, email, online, fax or mail.

The Bottom Line

Pet insurance can help you save money on pet care costs and protect your financial health if your animal is in an accident or gets sick. Compare quotes from multiple providers and review the covered services, reimbursement rate, deductible, waiting period and other plan details to find a plan that meets your needs and fits your budget.