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The basics of pet insurance

dog and catAmericans regard their pets as members of the family. Whether someone has a fluffy four-legged creature or a slithery reptilian companion, many people demand similar services for their pets as they do for themselves — and that includes pet health insurance.

According to the American Pet Products Association, Americans spent roughly $48 billion on their pets in 2010. Of that amount, they spent almost $13 billion on veterinary care and about $11 billion on medicine and medical supplies. The insurance industry isn't ignoring these numbers.

Kristen Lynch, spokesperson for the North American Pet Health Insurance Association, says that there are up to 20 companies that sell pet insurance in the United States and about five in Canada.

Insurance policies for pets have shot up in popularity because modern technology and medicine now allow pets to undergo procedures and surgeries that were inconceivable in the past. But such procedures are not cheap. For example, it can cost anywhere from hundreds to tens of thousands of dollars for a dog to undergo cancer treatments — depending on the size of the dog and the stage of the cancer. A hip replacement for a dog can cost as much as $10,000. Pet insurance makes these treatments feasible.

How much is that policy in the window?

dogInsuring your pet doesn't have to cost you an arm and a leg. Pet insurance can run between $10 to $100 a month, depending on the breadth of coverage, Lynch says.

For example, you can buy accident coverage (which pays for unexpected emergency care like your pet being hit by a car) for as low as $10 to $15 a month. Or you can purchase accident and illness coverage which starts at $20 a month. That will cover accidents as well as illnesses like the stomach flu. Finally, you can buy a top-level policy that will cover a broad range of services. This includes reimbursement for various surgeries and treatments and may also include a wellness or preventive care plan, office visits, annual health screenings and even the cost of medications.

Some employers offer a workplace benefit that will give you a discount on pet insurance.

Grant Biniasz, spokesperson for Veterinary Pet Insurance (VPI), which currently insures roughly 485,000 pets throughout the United States (including exotic types), says that VPI has a partnership with more than 2,000 employers in the United States.

Some of the employers that partner with VPI include Ford Motor Co., Office Depot and Chipotle Mexican Grill restaurants.

What pets can get health insurance?

As with human health insurance, different pet insurance companies offer a variety of plans. For example, VPI is unlikely to sell you pet insurance if your pet is more than 10 years old (pets that age are only eligible for VPI’s accidental-injury plan). But if you want to insure your boa constrictor, lizard, ferret or turtle, VPI is the only insurer in the nation that will insure exotic pets (with the exception of insurance companies that cater specifically to zoos).

Pets Best, another pet insurer, will provide certain types of coverage to older pets — assuming your pet does not have any serious pre-existing conditions. But Pets Best focuses solely on pooches and felines. If you are looking to insure your horse, for example, you have to find an equine insurance company. Most standard pet insurance companies do not cover horses because they are considered a higher risk.

Pet insurance costs

The prices of pet insurance plans are based on the amount of your deductible, the maximum amount the insurer will pay per incident and the maximum amount the insurer will pay out during the lifetime of your pet.

According to the Insurance Information Institute (III), most pet insurers will also offer wellness programs that cost roughly $144 per year. This type of plan reimburses you for preventive pet care including physical exams, diagnostic tests, X-rays and lab fees. There is no deductible to pay.

There are also "HMO polices” sold by some veterinarians, but they are not insurance policies and are not subject to the same state regulations required of insurance companies. According to III, these policies are similar to wellness plans and offer discounts on vaccinations, spay/neuter procedures and dental cleanings. Some also include basic health check-ups.

doggy

 

Top 10 Pet Medical Claims
Rank Dogs Cats
1
ear infections

urinary tract infections

2
skin allergies
gastritis/vomiting
3
hot spots/skin infections
chronic renal failure (kidney problems)
4
gastritis/vomiting
hyperthyroidism
5
enteritis/diarrhea

diabetes

6
bladder infections

enteritis/diarrhea

7
arthitis

skin allergies

8
soft tissue trauma
dental disease
9
non-cancerous tumor
ear infections
10
eye infection
eye infection
Source: Veterinary Pet Insurance, based on claims received in 2009.

 

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