Demystifying Pet Insurance
Because pets are for life, not just for Christmas! An artice written by Dr. Michelle Eyre
I have met many, many people who regretted not getting pet insurance. But I have never met a single one who has regretted getting pet insurance! I have pet insurance for my 3-year old Schnauzer, and most of our staff members now have pet insurance for their pets. More and more of our clients are taking out pet insurance, and we have seen claims worth many thousands of dollars. For most people, even one claim every 5 years would make it financially worthwhile!
Many people are unaware of the cost of healthcare (both human and veterinary), as the human healthcare system in New Zealand is subsidized heavily by the Government. For example, a fractured limb in a human that requires anaesthetic and surgical fixation would cost $20,000-$35,000. The same fracture in a dog would likely cost $4000-10,000 depending on severity. Most of us would struggle to come up with this sort of money at short notice, causing a lot of stress, and potentially leading us to make difficult decisions. If the pet is insured, the financial element of stress is taken away, or at least diminished, when faced with the already-stressful event of an unwell or injured pet.
Another thing that many people are unaware of, is the degree of cover with many of the insurance policies. Many of them will cover life-long medical conditions, not just accident/injury cover, as long as the medical condition is not pre-existing. For example, if my 3-year old Schnauzer is diagnosed with a heart condition or renal disease tomorrow, I know that these conditions will be covered under my Petplan insurance policy.
Pet insurance is relatively new to New Zealand. When I graduated 14 years ago, there were only 2 companies offering pet insurance. However, following in the footsteps of the UK, where approximately 20-40% of all pets are insured, more and more companies have begun offering pet insurance in NZ. Not all plans are created equal, and there can be a bit of a minefield in working out which one is the best for you and your pet! As Vets, we are here to help you navigate the minefield and help you choose the pet insurance company that is right for your needs. (As we are not financial advisers, we are unable to offer advise on which particular policy would be best for you).
Questions to ask when choosing a pet insurance plan:
- Does the plan cover congenital, breed-specific, and chronic issues?
Congenital illnesses are diseases your pet is born with, but may not exhibit symptoms of until later in life.Some insurance companies may consider congenital illnesses to be pre-existing conditions, even if there were no symptoms when the policy was taken out. Additionally, many breeds experience illnesses widely unique to the breed’s characteristics (e.g. pugs and other breeds with flat faces often experience breathing problems). Research the health conditions common in your pet’s breed and seek a plan that covers them.
- What exactly does the plan cover?
Some pet insurance companies offer accident-only plans as well as more comprehensive plans covering both accidents and illness.Most plans don’t cover the basics like annual vaccinations, spaying, neutering and teeth cleaning. Some pet insurance companies do offer the option of adding such coverage, but it does come at an additional cost.
- Does the plan cover examination fees?
Our standard examination fee is $63, but can the examination fee reach $300 and beyond at Specialist Centres, and if after-hours care is required. Some plans will pay only for diagnostics and treatment, without covering the examination fees.
- Does the plan cover bilateral conditions?
Issues like cruciate ligament injuries, and hip/elbow dysplasia are common, especially in older pets and large. Usually, if your pet experiences these issues in one knee, hip or elbow, they are likely to experience the same condition in the corresponding limb as well. These issues, along with cataracts, and other bi-lateral conditions, may be considered pre-existing conditions in some plans.
- Does the plan cover holistic care/alternative therapies?
Some plans may cover alternative treatments such as acupuncture and hydrotherapy, which may be used as complimentary treatments to traditional therapy.
- Does the plan have a per-incident or lifetime limit?
A per-incident limit is the highest amount that will be reimbursed for a specific condition or issue.This can be problematic if the per-incident limit is $1,000 but the vet bill is $4,000 (this is common with cruciate ligament surgeries).Most plans will have a yearly limit, but some have lifetime limits also.Lifetime limits are the maximum benefit a pet is eligible to receive in its lifetime.If a pet incurs high veterinary expenses early in life, it can be left without coverage for existing or future issues.
- What is the excess on the plan?
The excess is the amount you pay out of pocket before the insurance company starts paying. Under most pet insurance plans, the excess is applied annually, per condition.The excesses are reset when you renew the policy each year.
- Does the plan have any exclusions?
Most plans will not cover pre-existing conditions lifelong, however some plans will cover past conditions that have been cured for a certain number of months.Some plans also exclude coverage for certain illnesses or conditions, for example hip dysplasia.
- What are the stand-down periods on the plan?
Pet insurance plans have stand-down periods for coverage to begin after you sign up.Typically, the coverage for injuries or accidents begins within a week.The waiting period for illness coverage is usually longer, more like 2-4 weeks.There might also be stand-down periods of several months to a year or more for orthopaedic problems.
- What are the reimbursement levels of the plan?
Pet insurance plans reimburse you a percentage of the treatment costs (minus the excess).This is where you really need to check that you’re comparing “apples with apples”.Some companies will only pay 60-80%, and others will pay the whole amount (minus the excess).This becomes pretty important when you have a large bill!For example, if your reimbursement level is 100%, you will only pay the excess when presented with a $10,000 bill.If you reimbursement level is only 60%, suddenly you are finding yourself paying $4,000 of the same $10,000 bill.With most plans, you will pay the Vet fees up front, and then you will fill out a form to be reimbursed by the insurance company.
- What is the annual price of the premium?
Prices for pet insurance are based on:
- Your pet’s age and breed. With some plans, the premium increases with age. Some breeds may be more expensive to insure than others because they tend to have more health problems.
- Amount and type of coverage. The more the policy covers, the more you’ll pay per year.
- Reimbursement level and excess. The lower the reimbursement level and higher the excess, the less you’ll pay for the plan.
- Insurance company. Prices vary by company.
Most companies have easy-to-use websites that are able to quickly work out the annual premium on a particular policy for you.
Petplan provides us with a “4 Weeks Free” policy for all new puppies and kittens aged 8 weeks to 12 months. We will usually sign kittens and puppies up for this at their first visit to us (as long as they are over 8 weeks of age). We must have examined them within 48 hours of signing them up to this policy. The 4 week free insurance has a waiting period of 3 days for injuries and accidents and a 7 day waiting period for illness. Claims of up to $3,000 will be covered in this 4 week period. When making a claim, there is only a $150 excess to be paid per unrelated condition. A real benefit of converting the free 4 week policy to a permanent policy on time, is that if you do so, there will be continuous cover, and no further stand-down periods will apply.
For most of us, our pets have a special role in our hearts and are very much part of the family. When things go wrong we want to do what’s best for them and not have to worry about what it all costs. Please give pet insurance some serious consideration, and if you have any questions, or need further help navigating the pet insurance minefield, please give our friendly team a call on (09) 4371101.