Pet Insurance

(be sure to read the fine print)

This article appeared in the Bagpipes in January 2009.

Like all insurance, you need to have it, but you hope you never have to use it. The same is true for pet insurance. Basically, pet insurance pays the veterinary costs if your Beardie becomes ill, or is accidentally injured. If it's such a good idea, why do less than four percent of pet owners in the US have coverage? Probably because most people do not think it's a good economic decision. You may think pet insurance is a variation of your own health insurance, but pet insurance is actually a form of property insurance. Did you know that the first pet insurance policy was written in 1890, and was intended for horses and livestock?

According to a 2007 study by the American Pet Products Manufacturers Association, the average dog owner spent $261.30 a year in vet bills. An average monthly premium for an average policy (just the basics) to cover an average dog (healthy, five years of age) is $32.84. That means you would spend almost $390 for approximately $260 worth of care. So why pay out all that money for something that might happen? Some financial experts suggest depositing that money into a high interest paying savings account and withdrawing the cash as needed to pay for your pet's care. If you don't have the discipline, this self-insured approach may not be a good idea for you or your Beardie.

In a nutshell, premiums are based upon your pet's breed, age, health and zip code. Most companies have a deductible, either per year or medical event; along with a co-payment (you each pay part of the bill). Many companies have a maximum they will pay per incident, and you are then responsible for the balance. Monthly premiums will increase as the dog ages. Customarily, you pay your vet bill in full, and then submit your claim to the company for reimbursement. Most importantly, many companies have a "pre-existing condition" clause. For example, if you want to purchase coverage for your Beardie with Addison's disease and disclose this information on the application, any care related to this condition would not be covered.

I went on line and randomly chose a company to obtain a quote for my five Beardies. The following information was required; pet's name, birth date, gender and zip code. Incidentally, when I tried to enter Beardie # 4, I received a message indicating I needed to call and speak to a representative to get a quote for three or more dogs. To save time (and having to explain why I have five dogs), I opted to obtain quotes for my youngest and oldest Beardie. Sparkle was born 12/12/07 and is intact; Cowboy was born 4/5/96 and is neutered. Monthly premiums for basic coverage (see below) with a $500 deductible were - $26.03 for Sparkle and $43.91 for Cowboy. The amount of your premium also depends on the amount of your deductible, the higher the deductible, the lower the premium. This is the basic policy described on the web site.

If your pet becomes sick or is injured you are covered for:

There is a lifetime limit of $20,000 and one could choose any licensed veterinarian in the United States, including specialists.

When I read the policy conditions, I learned there is limited coverage for working pets and those pets that have not been spayed or neutered by their veterinarian's recommended age. In addition, coverage shall not apply to any condition resulting from activities related to racing, breeding, hunting, law enforcement or guarding. Okay, we don't hunt, race or chase after criminals, but we do participate in other activities that may be considered "risky" by an insurance company. If my Beardie were to sustain an injury on the agility course, would he/she be covered? I placed a call and was told "That's a good question. I'm not sure, but I'd be happy to have a representative call you back". The following day I received a call back from the company and was told my dog would not be covered if he/she sustained an injury while participating in an agility trial. Since herding dogs and therapy dogs are technically working, any claims submitted related to these activities could also be denied payment.

The phrase read the fine print came to mind, and I decided to check out the exclusions listed by other companies. One particular company had twenty exclusions listed; below are just a few.

The Insurer shall not be liable for:

Some of these statements provide a lot of wiggle room for the insurer to deny a claim. If I chose this plan (for my particular Beardie lifestyle), none of the costs associated with breeding would be covered, nor would any spay or neuter procedure, and no coverage for injuries sustained while engaged in a competitive event. Furthermore, if one of my dogs is diagnosed with a condition that is considered hereditary or is diagnosed with cancer, I would be responsible for the cost of treatment. Thinking about being less than truthful while filling out a claim form? This same company has a clause that states:

After a loss or claim, which may be payable under this policy, the Insured shall, as often as the Insurer reasonably requires:

It is also worth noting that many policies stipulate that insured pets must have received all of the vaccines that have been recommended by the insured's veterinarian. So if you are one of those people who don't believe in over vaccinating your Beardie, you should keep this in mind.

When researching a pet insurance company, it is important to know how long it has been in business, and if it is financially stable. Although the percentage of Americans with policies remains small, the pet insurance market has grown 26% annually since 2001, and there are many companies to choose from with a variety of options. If you only want to cover injuries and medical emergencies, the coverage will be less expensive than if you want complete coverage.  Some policies include well-pet check-ups and immunizations. There are policies that will only cover what is called "serious catastrophic illnesses", like cancer. You can also ask your veterinarian to recommend a reputable company.

The world of veterinary medicine is changing rapidly and your Beardies can expect nearly the same care and treatment that you receive, but this comes with a cost. We all fear the day may come when one of our Beardies will be diagnosed with a condition we cannot afford to treat. Peace of mind is priceless, and that's why pet insurance was developed. As I see it, the main problem with pet insurance lies in the details buried in the contract. So if you decide to buy pet insurance please read the policy thoroughly and remember the old saying "You get what you pay for".

Maryann Szalka