What the best pet insurance has

  • Comprehensive coverage. There are no pet care insurers that cover pre-existing conditions, but some cover hereditary, chronic, and congenital problems.
  • Clear exclusions. The provider's website should clearly and thoroughly explain, in layman's terms, what it does and doesn't cover, so you don't get a nasty surprise after making a claim.
  • Customizable coverage levels. Some plans offer more choices than others, but even the most basic plans should let you choose things like the amount of your deductible and the reimbursement level (co-insurance).
  • Actual cost coverage. Look for a policy that pays you back based on how much you actually paid the vet, rather than covering only a "reasonable and customary" amount for a particular service.
  • Quick claim payment. The best plans process claims within a week or two after you submit them, while the worst could string you along for a month or more.
  • Helpful customer service. Customer service should be easy to reach and should respond to your questions both competently and courteously.
  • A reasonable waiting period. Most plans make you wait 14 days after signing up before your coverage starts, but coverage for some special conditions can take longer, while some accident-only plans have shorter periods.

Know before you go

What do you want covered? Most basic pet insurance plans cover accidents and illnesses, either separately or together. Some throw in prescriptions, but other providers skip them or cover them only at an additional cost. Another common add-on is coverage for routine care, including yearly checkups and vaccinations.

What can you afford? Most pet insurers allow some degree of choice when it comes to deductibles, plan limits and co-pays. To save money on premiums, choose higher deductibles and lower reimbursement levels, but be careful: You'll pay more in the event of a costly claim. No matter what you choose, remember that pet insurers require you to pay out of pocket first and then wait for reimbursement.

How old is your pet? Most pet insurers won't cover pets below a certain minimum age—typically 6 to 8 weeks. In addition, many won't allow you to buy a new policy for an older pet, with age limits ranging from 10 to 15 years. One insurer, Healthy Paws ($13 per month and up), accepts pets up to age 14 but won't cover hip dysplasia unless your pet is enrolled before reaching 6 years of age. Also, with most plans, your premiums creep upward as your pets age.

Do you qualify for discounts? Pet insurers offer a wide variety of ways to reduce your premiums. Two of the most common discounts are for insuring more than one pet and for signing up online. Some providers offer discounts for vets (both veterans and veterinarians), for service animals, for spaying or microchipping your pet, or for paying for a full year of coverage in advance.

Is your pet prone to certain health problems? Certain breeds are at higher risk for hereditary and congenital conditions such as hip dysplasia, notes PetMD. These are not the same as pre-existing conditions, which are problems that the pet was already showing signs of at the time you bought the policy. No insurer will cover those, but some also exclude common hereditary and congenital conditions -- even if they crop up after a pet is insured. If your pet is at risk for these problems, make sure to choose a policy that covers them.

Do you have an exotic pet? Every major pet insurer covers dogs and cats, but Nationwide (price varies by pet) -- formerly known as Veterinary Pet Insurance, or VPI -- is the only big-name provider to cover exotic pets such as lizards, parrots and snakes. However, feedback for the company is more mixed than the top traditional pet insurance companies, keeping it out of the ranks of the Best Reviewed choices in this report. Another option for exotic pet owners is a pet health-care discount program such as Pet Assure ($8 per month and up), which provides discounted care for any animal as long as the veterinarian is in its network.

Value expectations: The dollars and cents of it

As veterinary medicine advances, costs grow steeper and pets live longer, making health problems -- and stiff bills -- more likely. But according to ConsumerReports.org, pet health insurance still isn't a good deal for most pet owners. Looking at the health-care costs of Roxy, a "basically healthy" 10-year-old beagle, the editors conclude that if her owners had invested in health insurance, they'd have paid more in premiums over Roxy's lifetime than they'd have received in benefits.

However, Dr. Frances Wilkerson, the vet who runs the Pet Insurance University site, argues that this is the wrong way to think about pet insurance. Its purpose isn't to save you money; it's to protect you from major, unpredictable expenses, just like any other kind of insurance. Dr. Wilkerson points that the alternative proposed in ConsumerReports.org, setting aside money in a special account to cover possible pet-care emergencies, works only if you have enough time to build up the account before an emergency occurs -- but since accidents and illnesses are impossible to predict, there's no way to be sure of this strategy. Moreover, in the case of a truly life-threatening emergency, a good pet insurance plan can save you from having to decide how much is too much to spend to save your pet's life.

Bottom line? Your heart and head have to decide this one together. If you're just not sure whether the cost is worth it, try taking the pet insurance test on the Pet Insurance University site. It asks questions about your pet and your financial situation to help steer you toward the best decision for you.

Elsewhere in this report:

Best Pet Insurance | Best Pet-Health Discount Plan | Our Sources

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