Put yourself in your clients’ shoes for a minute. You take your fur baby to the vet clinic for a routine exam, only to find out there’s a bigger problem: a chronic condition has developed, impacting your pet’s life, daily. While you’re trying to absorb that, you’re hit with another shocker — the estimated cost today is $2,500, and there is additional unknown care they will likely need in the years to come. You trust your veterinarian and know the recommended course of treatment is the right way to go. All the same, finances are tighter than usual right now…  

You’re not alone: unexpected pet care expenses like these often surprise today’s pet owners. That’s part of why PetDesk began helping clients find insurers. Veterinary care has evolved to include specialty medicine, such as radiation treatments. Similarly, preventative care standards have grown to include tests aimed at catching diseases early so we can extend the lives of our furry companions. In fact, a 2013 study by Banfield found that the average lifespan of cats and dogs increased 10% and 4%, respectively, from 2002 to 2012 (we all should know by now that cats will live to take over the world, so this gap should come as no surprise).  

High-quality, life-extending treatments will have costs associated with them, so every pet parent should think about how to cover veterinary costs before treatment is needed, which is only made easier when your vet hospital staff are on board with that plan. One way to defray specialty medicine and preventative care costs is pet insurance.

Pet Insurance as an Industry

The first U.S. pet insurance policy was presented to Lassie — the famous Rough Collie who starred in television and movies — in 1980 by Veterinary Pet Insurance (VPI) and Dr. Jack Stephens, who later founded Pets Best Insurance. Interestingly, Europe and the U.K. sold their first policy in Sweden almost 100 years earlier (1890). As pet ownership has grown, so has the pet insurance industry. In the U.S. alone, more than 13 companies sell pet insurance, contributing to the industry’s year-over-year growth rate of 17%. That’s a lot of policies and protected pets.

The number of households owning pets is growing every year, and an increasing number of pet parents are turning to pet insurance to guarantee their pets have access to the care that matters most. In 2018 more than 2.43 million pets were insured, representing only 2% of the total U.S. pet population. 

One of the primary issues pet parents face is the realization that not all insurance is the same. To better understand what insurance plan is “best” for you and your pet, it’s helpful to understand how pet insurance works. Technically speaking, you pay a premium for monetary reimbursement of a covered adverse pet health event. Insurance companies calculate the likelihood of these events occurring (their risk), which often determines the price (premium) you pay. Insurance policies and their coverage are outlined prior to purchase, and if you submit a claim for a covered event, you will receive an agreed-upon portion of the cost back in your pocket.  

Given the permutations of companies, policies, breeds, and procedures covered, the common knowledge held by U.S. pet parents is incomplete and, at times, confusing. To help you make an informed decision, we took a deeper dive into some of the leading myths associated with pet insurance. 

 

Myth #1- Insurance is only for the “big” stuff

You pay your car insurance premium every month but rarely submit a claim because auto claims are tied to accidents. The use cases for pet insurance are quite different and need to be viewed from a different perspective.

Pet insurance reimburses you when your pet has a problem. Pets live exciting lives — escape artists getting under the fence, quarreling over toys at the dog park, eating mystery items (sometimes food, sometimes not) — that can create the need for veterinary care. They also develop diabetes, are diagnosed with lymphoma, and go blind. The bottom line is that major medical problems can happen at any time.

Based on claims data from Pets Best, the average medical claim submitted in 2020 was over $350. The average claim amount is up 6% from 2019, indicating that while the cost of veterinary care is increasing, approved pet insurance claims are increasing, too. And not all of those approved claims are for what we think of as “big” items. In fact, some pet insurance policies actually cover routine treatment, like preventative care, which allows our pets to stay healthy longer by minimizing severity with early diagnosis. 

Rather than thinking pet insurance is limited to “big stuff,” help your clients understand that some policy providers offer preventative care plans, too.

Myth #2- The old payment methods are better. Pet insurance is a scam.

Veterinary care is a labor of love, and treatments are priced correctly for services provided (surgery, diagnosis, treatment). Still, seeing a four-digit number on the “Total Due” line can be a shock. According to Pets Best, the average cancer treatment could cost a dog owner up to $4,137, and a cat owner up to $3,282, annually. Pet owners pay almost $3,000 annually for diabetes treatment and more than $2,000 for broken bones.  Without pet insurance, those costs are understandably daunting, but with pet insurance clients can have some peace of mind knowing they will be reimbursed for a portion of the costs. 

Veterinary medicine is a cash-for-service industry. That means that without any alternative forms of payment methods, a client may owe $80, $200, or even $5,000 upfront. Many veterinary practices have added on payment plans that are, essentially, third-party payment alternatives that front the payment to the veterinary hospital, and the client pays the third party back over time. This breaks up payments, but in the end, you have to pay the full amount. With pet insurance, the client pays a monthly premium and possibly an out-of-pocket contribution but will be reimbursed (often very quickly) for their bill.

Think of it this way: your monthly pet insurance premium is a payment towards a reimbursement and helps you avoid the pain of a considerable up-front expense. Pet parents are often faced with the toughest decision of all. Can I afford this vet visit? Economic euthanasia is a very real and tragic scenario where a pet parent cannot afford the life-saving treatment needed for their pet’s survival. In this instance, although funding treatment may require maxing out a credit card at the time of service, pet parents can have greater peace of mind knowing a large portion of the treatment cost will be reimbursed quickly. 

Myth #3- There is no easy way to compare insurance plans

Online comparison tools and marketplaces have simplified shopping for car and health insurance, allowing you to find the best price for the coverage you need. Conversely, pet insurance can seem shrouded in mystery. But now there’s an easier way to explore your pet insurance options: PetDesk’s “Pet Insurance Guide,” launched just this year.

This new feature helps pet parents understand pet insurance and request a quote with Pet Desk-vetted insurance companies, all within the app. When they find an insurance plan that works for them, they sign up right then and there.

Myth #4- Insurance is too cumbersome and problematic

Many insurance companies are turning to technology to improve customer service. Policyholders have access to policyholder apps that allow you to submit a claim and check the status in real-time easily. Pet parents appreciate the simplicity mobile apps provide. In fact, more than 90% of claims to Pets Best are submitted online or through their mobile app. 

Pets Best also aims to provide policyholders with timely payments when claims are approved. The majority of claims sent to Pets Best are processed quickly, and the payment is paid directly into the policy holder’s bank account. 

Myth #5- Pre-existing conditions make it impossible to get coverage

Despite the fact that “pre-existing conditions” is a term we are all familiar with, insurance companies do not have to cover them. No pet insurance company covers pre-existing conditions, as doing so would make the cost of pet insurance prohibitively high. But, if your pet has a pre-existing condition, there are many future health issues that pet insurance may still cover. It’s worth noting that pre-existing conditions are different from congenital or hereditary conditions, which may also not be covered. If the symptoms of those conditions occurred prior to insuring the pet, then they would be considered pre-existing, more than likely. Ultimately, the earlier you get a pet policy, the more likely you are to have future conditions covered. 

Many insurance companies have a variety of plans to choose from, including some that cover hereditary or congenital conditions. Check with your provider (or potential provider) for more information about these situations. When it comes to pre-existing, congenital, and hereditary conditions, the insurance companies make it clear from the outset what is and is not covered. 

Conclusion

Navigating the pet insurance space can be difficult, so take the time to explore your options. 

The PetDesk Pet Insurance Guide, available to PetDesk users in the U.S., gives you information on companies vetted by both PetDesk and the marketplace, to help you determine what policy and policy provider is best for your unique circumstances.

David Liss, MBA, CVPM, PHR, RVT started his career as a veterinary technician in emergency medicine in 2003. During his time as an on-the-floor veterinary technician, he oversaw two 24-hour specialty referral practices as Technician Manager and obtained two veterinary technician specialty certifications, in emergency and critical care and internal medicine. David then became the Program Director of a veterinary technology associate’s degree program in Los Angeles for several years. David returned to management to lead a 24-hour general practice and emergency hybrid hospital and became a certified veterinary practice manager (CVPM) and professional in human resources (PHR). He currently is the regional director of operations for Amerivet Veterinary Partners in the LA area, completed his MBA in 2020, and lectures worldwide.

Pet insurance coverage offered and administered by Pets Best Insurance Services, LLC is underwritten by American Pet Insurance Company, a New York insurance company. Please visit www.americanpetinsurance.com to review all available pet health insurance products. Terms and conditions apply. See policy details.