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How Does Pet Insurance Work?

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There are some similarities and some differences between pet insurance policies and human health insurance. Before deciding if pet insurance is right for you, you should understand how it works and weigh the cost and the benefits to you financially.

What is Covered by Pet Insurance

Many different companies offer pet insurance, and you can choose from different types of policies according to the health status and age of your pet. There are policies that cover preventive care such as vaccinations and checkups, and there are some policies designed for catastrophic illnesses. As with human health insurance, the companies offering the policies will sometimes deny coverage for illnesses or conditions that exist before the policy goes into effect (pre-existing conditions).

Does Pet Insurance Make Financial Sense for You?

After you decide on a policy, there is usually a physical check up required before your pet will be covered under the plan. There is usually a waiting period (8 to 10 days) before your pet’s coverage will be in effect.

The very best way to decide if a pet insurance policy will benefit you financially in the long term is to take a thorough look at an entire year of vet bills. Compare the monthly premium you will pay (usually around $300 to $400 per year) to the cost of services your pet required, taking into consideration the co-pay amounts you will pay out of pocket. If your insurance will offset your costs, pet insurance may be a smart move.

Choosing the Right Pet Insurance Policy

Take a close look at the policies you are considering, to be sure there aren’t extra services included that you will not use. Like human health insurance, pet insurance gets more expensive as the coverage increases, and there is no benefit to paying for coverage you won’t use.

The younger and healthier your pet is, the more affordable the coverage will be. Examine the policy carefully for exclusions, limitations, and deductibles that will be your financial responsibility.

Unlike human health insurance, your reimbursement will usually come after you pay for services up front. In many instances, your vet clinic staff will help you fill out the paperwork and provide receipts or other documents you might need. Exceptions to this would be a clinic that is a participating provider in a network for an insurance company. In this case, you may only be responsible for the co-payment up front.

After the claim is processed, you’ll receive a check in the mail for the amount the insurance company allows for the services with any deductibles and co-payments subtracted. Any care your pet received that is not covered under the policy will also be excluded from the amount.

Ask your veterinary clinic staff if you have questions before purchasing a policy. They may be able to provide information on companies they have dealt with or are in network with.

Under the right circumstances, buying a pet insurance policy may help you care for your animal and give you peace of mind, especially in the event of an emergency.

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