What Is Pet Insurance and How Does It Work?

Pet insurance covers unexpected veterinary expenses, but costs can vary depending on your animal and its coverage needs.

Lindsay Frankel
Written byLindsay Frankel
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Lindsay FrankelInsurance Writer
  • 5+ years in auto insurance and personal finance writing

  • Featured in top personal finance publications

Lindsay is a widely published creator of auto insurance content. She also specializes in real estate, banking, credit cards, and other personal finance topics.

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Danny Smith
Edited byDanny Smith
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Danny Smith
  • Licensed auto and home insurance agent

  • 4+ years in content creation and marketing

As Insurify’s home and pet insurance editor, Danny also specializes in auto insurance. His goal is to help consumers navigate the complex world of insurance buying.

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Updated October 5, 2023 at 5:00 PM PDT

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Veterinary care for your pet can be extremely costly, making pet insurance a valuable asset for any pet owner. It covers diagnosing and treating various illnesses and accidents, so you can focus on keeping your pet healthy rather than worrying about the expense.

Coverage varies widely by pet insurance company, so it’s important to understand how it works before choosing a policy. Here’s what you need to know so you can make the right decision for your pet.

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What is pet insurance?

In some ways, pet insurance works similarly to human health insurance. You pay a monthly premium in exchange for a certain level of coverage, which typically comes with exclusions. Policies also come with an annual deductible, the share of the cost you’re responsible for each year if your pet needs treatment.[1]

However, health insurance networks don’t exist for pets. Instead, your pet insurance company will reimburse you if your claim is approved, regardless of which veterinarian you visit. In that sense, it’s similar to property insurance.

Can You Get Life Insurance for Your Pet?

Can You Get Life Insurance for Your Pet?

How pet insurance works

Pet insurance reimburses you for your pet’s veterinary expenses. Here’s how it works:

  1. Purchase a policy. Choose a pet insurance company and buy a policy online. Be aware there may be a waiting period before certain coverages go into effect.

  2. Pay for care. When your pet gets sick or injured, take it to a veterinary clinic and pay for its care.

  3. File a claim. A claim is a request for reimbursement. Most pet insurance companies allow you to submit your claim online or in an app. You’ll likely need to upload your receipt and your pet’s medical records from the visit.

  4. Wait for approval. Some claims may be approved instantly, while others can take weeks.

  5. Receive reimbursement. Your pet insurance company will pay the agreed-upon percentage of your costs minus your remaining deductible.

Bear in mind that while this process is the most common, some pet insurance companies offer the option to pay your vet directly.

Types of pet insurance and what they cover

You have a few types of pet insurance to consider. You’ll want to choose between an accident-only policy and an accident and illness policy, and you’ll also need to decide if you want to add wellness coverage.

Accident and illness coverage

Accident and illness policies offer the broadest coverage. They generally cover the diagnostics and treatment of illnesses, like infections or cancer, as well as accidents, such as broken bones or accidental poisoning. Some companies might not cover behavioral conditions, dental illnesses, or hereditary conditions and instead may offer these coverages as add-ons.

Accident-only coverage

Accident-only coverage is typically more affordable than accident and illness coverage, but it only covers accidents. Coverage typically includes treatment for accidental foreign body ingestion, bite wounds, poisoning, broken bones and sprains, cuts and abrasions, torn nails, and other accidental injuries. Some plans also include tooth extractions for dental accidents.

Wellness coverage

Wellness coverage generally isn’t subject to the same reimbursement rates, annual limits, or deductibles as pet insurance. It covers all routine care and preventative care up to a maximum amount, and insurers typically offer it as add-ons to the other types of pet insurance.

Wellness plans typically cover routine veterinary exams, vaccinations, preventative medication, and sometimes dental cleanings. Since you can foresee wellness expenses, you can also cover them with savings instead of purchasing a wellness plan.

Best Pet Insurance Companies and Plans for 2024

Best Pet Insurance Companies and Plans for 2024

What pet insurance doesn’t cover

Pet insurance exclusions vary by plan. Most pet insurance policies don’t cover the following:

Pre-existing conditions

If your pet showed symptoms or was diagnosed with a condition before your policy went into effect, insurers usually won’t cover treatment. If the condition is considered curable, it may be covered after your pet is symptom-free for a certain amount of time.

Some pet insurance companies will consider certain bilateral conditions, like hip dysplasia, to be pre-existing if they occurred before the policy effective date. AKC Pet Insurance is an exception — the company covers pre-existing conditions after a one-year waiting period.[2]

Breeding costs

Most pet insurance plans don’t cover breeding or pregnancy-related health complications. However, some companies may offer breeding coverage as an add-on.

Cosmetic surgeries

Most pet insurance policies don’t cover procedures that aren’t medically necessary. These include cosmetic surgeries, such as declawing, tail docking, and ear cropping.[3]

Other common exclusions

Insurers typically exclude the following expenses:

  • Dental illnesses

  • Behavioral problems

  • Hereditary and congenital conditions[4]

How much does pet insurance cost?

Pet insurance costs vary by your pet’s species, breed, and age. Your location and coverage selections will also affect the cost of the policy.[1] Below are quotes for dogs and cats based on an accident and illness plan with a $500 deductible, a $10,000 annual limit, and an 80% reimbursement rate, or the closest available offering. Prices were for the base policy without add-ons.

Average cost of pet insurance for dogs

Quotes are from nine companies for a 2-year-old, medium-sized male mixed-breed dog living in Hartford, CT, with prices rounded to the nearest dollar. Spot’s base policy offers broader coverage than Lemonade’s, though the cost is more than double.

Insurance CompanyAverage Monthly Cost
Lemonade$24
Figo$25
Pets Best$30
Nationwide$33
Healthy Paws$38
ASPCA$44
Embrace$46
Spot$49
Trupanion$63
Actual quotes may vary based on the policy buyer's unique profile.
Best Pet Insurance for Dogs (2024)

Best Pet Insurance for Dogs (2024)

Average cost of pet insurance for cats

Quotes are from nine companies for a 2-year-old female American shorthair cat living in Hartford, CT, with prices rounded to the nearest dollar. Figo offers the cheapest coverage for cats, while Embrace is the most expensive.

Insurance CompanyAverage Monthly Cost
Figo$13
Lemonade$14
Healthy Paws$18
Nationwide$18
Pets Best$20
ASPCA$23
Trupanion$24
Spot$26
Embrace$32
Actual quotes may vary based on the policy buyer's unique profile.
Best Pet Insurance for Cats (2024)

Best Pet Insurance for Cats (2024)

  • Insurify sourced the quotes on this page directly from the pet insurers’ websites. Dog quotes were based on a 2-year-old male mixed-breed dog weighing between 31 and 50 pounds and living in Hartford, Connecticut. Cat quotes were calculated based on a 2-year-old female American shorthair that lives in Hartford, Connecticut. Quotes were based on a $500 deductible.

    Keep in mind that your quotes may look different based on your particular pet profiles and where you live.

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Factors that affect your pet insurance premiums

Your pet insurance premium depends on several factors, including your pet’s breed, age, and location. The coverage options you select will also affect your rate.

Species

Some species are more accident-prone than others. Since more injuries happen to dogs, pet insurance companies typically charge more to insure dogs than cats.

Breed

Some purebred dogs and cats are predisposed to certain health issues, so they’re more expensive to insure, while mixed-breed dogs and cats tend to get cheaper premiums. Short-nosed and large dogs are also typically more expensive to insure.

Age

Since senior pets have a higher risk of health conditions, premiums tend to increase as your pet ages. Larger dogs, which have shorter lifespans than smaller dogs, are typically considered seniors at a younger age than small dogs.

Location

Where you live will affect your premiums because veterinary treatment costs vary by location. For example, premiums are typically higher in busy urban areas, like New York and San Francisco, than in rural communities.[5]

Choice of company and coverage

Some companies offer broader coverage at a higher price. The add-ons you select will also influence the cost of your policy.

Reimbursement level

You’ll pay more for a policy covering 100% of your costs than for a policy covering 70% of your costs. Most companies allow you to choose your reimbursement percentage, which will be reflected in your premium.

Annual limit

The lower your annual coverage limit, the lower your premium. However, a policy with a low annual limit may not cover all your costs if your pet has a serious health issue.

Deductible

A higher deductible means lower premiums. Just make sure you can cover your deductible amount with your savings.

How to find cheap pet insurance

Health insurance for your pet can be costly, but pet owners can reduce their premiums in the following ways:

  • illustration card https://a.storyblok.com/f/162273/x/fa11c1fe75/comparison-website.svg

    Compare quotes

    Some companies may offer a lower premium than others for the same coverage. The easiest way to find the lowest price for the coverage you need is to get quotes from a handful of pet insurance companies.

  • illustration card https://a.storyblok.com/f/162273/101x101/88ac443824/dog-collar.svg

    Look for discounts

    Some pet health insurance companies may offer discounts, like multi-pet or military discounts. If you’re eligible, account for the discount when comparing insurers.

  • illustration card https://a.storyblok.com/f/162273/100x100/00dd026525/paw.svg

    Reduce your coverage

    You may opt for a lower reimbursement amount or lower annual limit to reduce your premium. But be aware that you’ll have to spend more out of pocket when you file a claim.

  • illustration card https://a.storyblok.com/f/162273/100x100/4d03c561b5/declaration-page.svg

    Skip the add-ons

    Many pet insurers offer add-ons that can be expensive. If you don’t need the coverage, skip it. For example, adding exam fee coverage may not be worth the cost.

  • illustration card https://a.storyblok.com/f/162273/100x100/9cd41581f2/savings.svg

    Raise your deductible

    Choose a higher deductible for a lower premium — just make sure you have enough saved to cover your share.

  • illustration card https://a.storyblok.com/f/162273/100x100/ed7e75ea26/cat.svg

    Insure your pet at a young age

    Premiums are lower for younger pets. And if you buy insurance for a puppy or kitten, you’re less likely to have a pre-existing condition to worry about — that means more coverage for less.

  • illustration card https://a.storyblok.com/f/162273/100x100/df30ef509c/dog.svg

    Get an accident-only plan

    An accident-only policy is a more affordable solution and may be a wise choice for older pets or pets with pre-existing conditions.

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Pet insurance FAQs

Choosing the right pet insurance policy can be difficult, and your coverage options may seem overwhelming. We’ve got your back with answers to some commonly asked pet insurance questions.

  • Is pet insurance worth it?

    It depends. Pet insurance provides peace of mind and financial protection, but if your pet never has health issues, you’ll have spent more than you need to. However, pet insurance could save you thousands of dollars if your pet has serious health issues. Pet insurance could also save your pet’s life if you can’t afford the costs of veterinary care without it.

  • Do you need pet insurance?

    If your pet needs cancer treatment or emergency surgery, the vet bills could set you back thousands of dollars. Pet insurance is a good idea if you want to care for your pet’s needs but can’t afford to pay for your pet’s potential medical expenses.

  • How do pet insurance deductibles work?

    Your pet insurance deductible is the amount of your eligible vet bills you’re expected to cover each year. For example, if you have a $500 deductible and you incur $2,000 in medical costs, your insurance company will only cover a percentage of $1,500, according to the reimbursement rate defined in your policy.

  • Does pet insurance cover animals other than cats and dogs?

    Most pet insurance companies only provide pet health insurance for cats and dogs, but Nationwide Pet Insurance offers pet insurance for birds and exotic animals as well.

Sources

  1. National Association of Insurance Commissioners. "Pet Insurance." Accessed September 19, 2023
  2. American Kennel Club. "What Is a Pre-Existing Condition in the World of Pet Insurance?." Accessed September 19, 2023
  3. Illinois Department of Insurance. "Pets." Accessed September 19, 2023
  4. Washington state Office of the Insurance Commissioner. "What's covered and not covered under pet insurance." Accessed September 19, 2023
  5. North American Pet Health Insurance Association. "NAPHIA’s Pet Insurance Buying Guide." Accessed September 19, 2023
Lindsay Frankel
Lindsay FrankelInsurance Writer

Lindsay Frankel is a content writer specializing in personal finance and auto insurance topics. Her work has been featured in publications such as LendingTree, The Balance, Coverage.com, Bankrate, NextAdvisor, and FinanceBuzz.

Danny Smith
Edited byDanny Smith
Photo of an Insurify author
Danny Smith
  • Licensed auto and home insurance agent

  • 4+ years in content creation and marketing

As Insurify’s home and pet insurance editor, Danny also specializes in auto insurance. His goal is to help consumers navigate the complex world of insurance buying.

Featured in

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