Pet Insurance Primer

“They never get sick during business hours, do they?”

The receptionist at the emergency vet clinic gave me a wry smile as she handed back my credit card.

The good news was that an antihistamine shot would quickly help my pup recover from a reaction to an insect bite.  The bad news was that my credit card just had $600 added to its balance.

I vowed to purchase pet insurance the next day, but what I thought would be a quick and simple transaction turned into two days of building complex spreadsheets.

Lulu’s bad day lead to an expensive late-night trip to the emergency vet clinic.

How a pet owner become a pet insurance advocate

Hi, my name’s Mitch.  I live in Sydney with my absolutely awesome 1-year old Jack Russell, Lulu.

It was certainly never my intention to run a website about pet insurance.

I like to thoroughly research products before I buy them, and I when I started diving into pet insurance I found that there were more than 20 brands to choose from, each with a complex set of benefits and limitations and a wide range of prices.

I dove into the details on each plan and before I knew it, I had created a giant spreadsheet on the key points for nearly every plan.  It helped me to pick the plan that was the best fit for Lulu and me, and I shared it with a few friends, who encouraged me to put my findings online.  That started the ball rolling, and before I knew it, I’d added write-ups on every pet insurance brand I could find and heaps more.

Here are some of the key things that I think you should know about pet insurance for your dog or cat:

Types of Coverage

Most pet insurance brands offer three levels of coverage:

Accident Only – Covers treatment for injuries, such as lacerations or a broken leg.  These are usually the cheapest form of policy, have little or no waiting period, and no maximum age limit.  However, these policies generally do not cover any treatment for illnesses or other medical conditions.

Accident and Illness – This is the most common coverage level, generally providing benefits for when your pet is sick or hurt.

Comprehensive – Accident and illness coverage, plus some benefits for routine care, such as vaccinations and wormings.  Many comprehensive policies also include higher annual benefit caps and/or reimbursement rates.

You should also know that there are a growing number of products – offered by some very well-known brands – that may look like pet insurance, but don’t actually provide coverage for treatment.  They often are marketed as “wellness plans” or add-on products for other insurance policies.  Always make sure that you read the product disclosure statement before buying any insurance plan so that you understand what you are getting for your money!

Key Coverage Terms

While every plan is different (and again – read the PDS!) here are the main criteria I use to evaluate pet insurance policies:

Reimbursement Rate – This is how much your insurance plan will repay you for treatment costs.  Most plans will reimburse you for between 70% – 85% of your eligible expenses.

Excess – The excess amount is excluded from the claim; it reduces the amount that you are reimbursed.  For example, if you have a $200 excess and an 80% reimbursement rate, you would receive $80 on a $300 claim ($300 claim – $200 excess = $100 X 80% reimbursement rate = $80 payment).  Some plans apply the excess only to the first time your pet is treated for an accident or illness (or the first time each policy year), while others apply the excess to every visit to the vet.  Excess amounts usually range from zero to $200, with some plans allowing you to pick your excess amount.

Annual Benefit Limit – This is the most that you can be reimbursed in a year, for all claims.  Caps range from $5,000 all the way up to $20,000.

Sub-limits – In certain situations, your total benefits will be capped at a much lower amount, such as for paralysis tick treatment or cruciate ligament surgery.

Pre-Existing Conditions – If your dog or cat was treated for an injury or medical condition before you purchased pet insurance, any further treatment is usually excluded from your coverage.  Purchasing pet insurance when your pet is young can help keep this list of exclusions short, as older dogs and cats have generally made more visits to the vet for various ailments and injuries.

Waiting Period – When you buy a pet insurance policy, you are usually covered for accidents right away, but will have to wait several weeks before full coverage kicks in.  Most plans require a 21 or 30 day waiting period before providing benefits for illnesses, and longer waiting periods may apply for cruciate ligament surgery.

Price

Pet insurance can cost less than $30 per month all the way up to $100 or more per month.  There is a wide range of factors that impact price.  These include the type of policy, coverage levels, your pet’s breed, age and sex, your age and location, and GST and stamp tax.  Some brands operate on thin profit margins, while others charge high markups.

It can definitely pay to shop around!  Start with my chart on pet insurance prices and benefits.  It summarises the accident and illness plan for every pet insurance brand in Australia that I know about!

Many plans also have promotions for new customers.  I update this list of pet insurance discounts each month.

Having fun with Lulu!

Make sure you do your own thorough research before buying pet insurance (or any kind of insurance)!  I’ve spent hundreds of hours researching pet insurance, meeting with pet insurance executives, and getting the opinions of vets and pet owners, but I am not a trained or professional insurance adviser, and this site is not a substitute for conducting your own research or consulting a qualified insurance professional.

Finally, I created this site, in part, because I was disappointed to see that other sites on pet insurance only provided information on brands that compensated them.  I wanted to put out information on every pet insurance brand (that I know of), to provide a true overview of the many options available to pet owners.  It turns out that this does take a lot of work, so I have signed up as an affiliate with a few of the brands, which are listed in the footer of every page of this site.  If you purchase pet insurance via one of these affiliate links, I earn a small fee, which goes to pay for the development and maintenance of this site, with a bit left over for the dog treat budget and profit.  Affiliate fees don’t change the price that you pay.  Be sure to pick the plan that best fits the needs of you and your pet.