Florida Mulls Bill to Leash Pet Insurance Providers

Faced with the highest home insurance premiums in the country, Floridians may not be giving much thought to escalating pet insurance costs and potential pitfalls. But some state lawmakers are.

A Florida senate subcommittee unanimously approved a proposed bill that would give the state’s Office of Insurance Regulation authority over pet insurance companies doing business in the Sunshine State. The bill aims to take on unfair methods of competition and unfair or deceptive practices by companies selling pet wellness and pet health insurance plans.

Rising pet care and pet insurance costs

Pet health insurance is a growing industry.

Nearly 87 million households — about 66% of all households — own a pet, according to the American Pet Products Association. Americans spend about $143.6 billion annually on vet care and products, the APPA reports.

By the end of 2022, pet insurance covered nearly 5 million animals, according to the North American Pet Health Insurance Association. The average premium for pet health insurance has risen every year since 2018, when the NAPHIA started tracking this data.

Proposed pet insurance requirements

If approved by the full state legislature, SB 1338 would establish uniform definitions for common pet insurance terms and require pet insurers to disclose to pet owners:

• Whether a policy is a wellness program or pet insurance

• Any exclusions the policy may have for pre-existing conditions or other conditions

• Details about waiting periods, deductibles, coinsurance, and annual or lifetime policy limits

• Whether claims history, pet age, or a move will affect premiums

• The name of the underwriting company if it’s different from the name the product is marketed and sold under

The bill would also require pet insurance companies to improve transparency around claims, determine claim payments based on usual and customary fees, disclose if they require a veterinarian exam to establish coverage, and provide full premium refunds under certain circumstances.

SB 1338 follows a template provided by the National Association of Insurance Commissioners. The NAIC passed the Pet Insurance Model Act in 2022 to help establish regulatory standards for the pet insurance industry.

What’s next?

“This is long overdue,” the bill’s sponsor, Sen. Nick DiCeglie (R-St. Petersburg), said in a meeting of the Banking and Insurance Committee, according to an Insurance Journal report. “OIR does not have a regulatory framework to work in, and that is what this bill seeks to accomplish.”

The bill is now before the Appropriations Committee on Agriculture, Environment, and General Government.