What You Should Know Before Buying Pet Insurance
Should you get Pet Insurance or bank cash instead for your pet’s health?
A conversation with a customer recently spurred us to write on pet insurance. They had a pet insurance monthly premium of over $100. Then their dog got sick. After paying the deductible (fixed amount you pay before you can get reimbursed), they got reimbursed 80% of expenses.
Soon after, the monthly premium for the pet went up by 30%. Usually, the standard excuse provided by the pet insurance is that due to vet prices in the area increasing, therefore premiums are as well.
Typically, all pet insurance companies state there is no causation between your insurance claims and price hikes. However subsequently, the dog got sick again and the cost of their pet insurance jumped by another 23%.
In conclusion, instead of getting reimbursed for 80%, they were only reimbursed for 10% of expenses.
Simple explanation of pet/ dog insurance for a Minor Accident
| Beginning of Insurance: | Middle of Insurance (30% increase): | Insurance (23% increase) and covered at 10% of costs: | |
| Premiums and Reimburse rate | $1200 premium per year paid by dog owner. | $1560 premium per year paid by dog owner. | $1920 premium per year paid by dog owner. |
| Example of a Minor Accident/ Illness cost | $3000 | $3000 | $3000 |
| Co-insurance (% not covered by insurance.) | 80% reimbursed for treatment costs.20% not covered by insurance = You pay -$600 | 80% reimbursed for treatment costs.20% not covered by insurance = You pay -$600 | 10% reimbursed for treatment costs.90% not covered by insurance = You pay -$2700 |
| Subtotal | $2,400 | $2,400 | $300 |
| Deductible (the fixed amount you pay yearly in addition to Co-insurance) | You pay additional -$200 | You pay additional -$200 | You pay additional -$200 |
| Total Reimbursement by Insurance company | $2,200 | $2,200 | $100 |
| What you pay out of pocket this year (Yearly Premium + Co-insurance + Deductible) | 1200+600+200 = $2,000 | 1560+600+200 = $2,360 | 1920+2700+200 = $4,870 |
| Better off/ (Worse off) compared to paying for $3000 by yourself | BETTER OFF by $1,000 | BETTER OFF by $640 | WORSE OFF by $1,870 |
As long as the treatment costs are high and co-insurance and deductibles are low, maybe pet insurance is a really good idea.
Should you get Pet Insurance for your dog or cat?
Some people would wonder why pet insurance is more expensive than their monthly BC MSP healthcare. In Canada, healthcare is subsidized by the government out of taxes making it cheaper than private healthcare. We’ll tell you why most pet parents go with pet insurance. They believe they would spend what they have and more if anything happened to their dog or cat.
If you feel the same way then having pet insurance might be limiting your overall financial exposure.
Secondly, dogs get into injury situations that thinking humans should not. The answer to “should you get pet insurance” is, it depends. We know that answer isn’t great yet we think it really depends on balancing the following factors:
- Type of pet and breed
- Age of dog/cat,
- Propensity for illness/ injury e.g. hip dysplasia,
- Cost of the insurance,
- Likelihood that you will deposit funds into a doggy/kitty account, and
- Probability of the insurance company to process claims promptly without denying them/ increasing co-insurance or deductibles after claims.
- Likelihood that you will spend all you have to care for your pet
Finally, we define pet insurance as just in case your pet has accidents (external force) or falls ill. Note that routine checks and vet’s consultation fees are typically Not covered.
Review of the 3 Best Pet Insurance Plans in Canada. Which pet insurance is the best?
We decided to compare four of the most common pet insurance companies and choose the “most popular/ regular” plan to give you an idea of what they cost and cover:
Dog: Cleo (actually a cat’s name),
Type: Staffordshire Bull Terrier (she eats like one at least)
Age: 4 years (she thinks she’s a spring chicken)
Here are the comparables including exclusion info. We put the CONS first because most of what we’d want covered are more important than ‘nice’ little riders we don’t necessarily need. Note that most of the information for insurance is in their policy wording yet not everyone reads them before signing up. We tried to accurately capture them below based on our read:
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BCAA Pet Insurance | Trupanion Pet Insurance |
Petsecure Pet Insurance | ||||||||||||||||||||||||||||||||||||||||
| Premiums and deductible | $50.79 monthly on the Intermediate Plan Deductible based on dog’s age = $200. | $127.19 monthly on the most popular Plan. Deductible is $200. | $63.50 monthly on the most popular Plan.Deductible is $300. | ||||||||||||||||||||||||||||||||||||||||
| Coverage by insurance | 80% coverage | 90% coverage excluding examination fees and taxes. | |||||||||||||||||||||||||||||||||||||||||
| What’s covered | Accidents, illnesses | Accidents, illnesses | “ Hospitalization, Dental care (dental treatments and cleanings), Surgery, Diagnostics, Medication, Exam fees, Taxes” | ||||||||||||||||||||||||||||||||||||||||
| Accident Coverage | Up to $2,500 accident and illness coverage combined annually! Limit renews each year | 90% of expenses, No limit.Since no sales taxes are covered, it may work out to about 80% of expenses. | Up to $2,500 per accident | ||||||||||||||||||||||||||||||||||||||||
| Illness Coverage | Up to $2,500 per illness, per year | ||||||||||||||||||||||||||||||||||||||||||
| Alternative therapy coverage | $350 per year | Additional alternative therapy costs $16.47 premium per month. | $350 per year | ||||||||||||||||||||||||||||||||||||||||
| Disadvantages of the Pet Insurance Plans | · The Annual Limit is very small and may not be sufficient for common injuries e.g. a back injury, torn ligaments (CCL) may cost over $5,000 including tests | · High Monthly premium price | · The Limit per accident or illness may not be sufficient for common injuries e.g. a back injury, torn ligaments (CCL) may cost over $5,000 including tests | ||||||||||||||||||||||||||||||||||||||||
| · Pre-existing conditions are excluded and are vague enough to include anything that with or without a confirmed diagnosis shows for your pet e.g. if your pet is itching a bit at 4 months for any reason and that is included in the vet’s notes, your pet may be excluded for allergies if that develops in the future. Cancer may fall under these conditions. | · Pre-existing conditions are excluded where there are signs or evidence of their potential manifestation existed within the 18 months prior to the Policy Enrollment Date and even if there are no medical records about potential signs incl. CCL, see policy sample Section 9 IV for more examples. | · Pre-existing conditions are excluded and are vague enough to include anything that with or without a confirmed diagnosis shows for your pet e.g. if your pet is itching a bit at 4 months for any reason and that is included in the vet’s notes, your pet may be excluded for allergies if that develops in the future. Cancer may fall under these conditions. | |||||||||||||||||||||||||||||||||||||||||
| · Excludes expenses for cats showing clinical signs of FIP, FIV or FELV prior to the policy inception or during the waiting period | · N/A | · Excludes expenses for cats showing signs of FIP, FIV or FELV prior to the policy inception or during the waiting period | |||||||||||||||||||||||||||||||||||||||||
| · Deductible rises as pet ages (which defeats the purpose of most of us getting insurance) i.e. for a dogo Up to 5 years is $100 annual,
o 5- 7 years is $200 annual, o 7-10 years is $400 annual and o over 10 years is $500 annual | · Not stated clearly in their documents but from personal experience as well as others we know using Trupanion, we’ve had rates and deductibles “coincidentally” change when claims increased | · Deductible rises as pet ages (which defeats the purpose of most of us getting insurance) i.e. for a dogo Up to 5 years is $100 annual,
o 5-10 years is $300 annual o and over 10 years is $500 annual | |||||||||||||||||||||||||||||||||||||||||
| · Not stated clearly in their initial quotes but they can increase your co-insurance by 10% increments to a maximum of 50% if your pet falls into “risk management” category, which is a pet with ongoing claims. | · N/A | · Not stated clearly in their initial quotes but they can increase your co-insurance by 10% increments to a maximum of 50% if your pet falls into “risk management” category, which is a pet with ongoing claims. | |||||||||||||||||||||||||||||||||||||||||
| · Don’t cover dental expenses under this plan | · | · N/A | |||||||||||||||||||||||||||||||||||||||||
| · Any change in your coverage means you have to state any pre-existing medical conditions as of your new policy – meaning if your pet developed a condition recently, it would not be covered under the new plan although it was under the old plan. | · N/A | · Any change in your coverage means you have to state any pre-existing medical conditions as of your new policy – meaning if your pet developed a condition recently, it would not be covered under the new plan although it was under the old plan. | |||||||||||||||||||||||||||||||||||||||||
| Advantages of Pet Insurance Plans | · They pay for lost pet advertising (up to $250)· If you are hospitalized for at least two days, they may pay for boarding for your dog. ($25 per day up to $500)
· If you have to cancel or cut a holiday short because your pet suffered an “Accident or illness” they will pay for any travel and accommodation expense you can’t recover (up to $500) | · Cover congenital & hereditary conditions as long as they were not pre-existing before coverage started (Remember, as per their policy it states that the conditions cannot exist 18 months prior to the Policy Enrollment Date.)· Hip dysplasia coverage is included in Trupanion’s core policy.
· Cover hospital stays, while herbal treatment is at an additional monthly premium to the pet owner · Cover dental illnesses & injuries · Clear that your dog’s age, breed, gender, spay/neuter status and vet costs can change cost of insurance · Can pay your veterinarian directly so you don’t have to pay out of pocket. · Pretty quick turnaround on claims in our experience. | · They pay for lost pet advertising (up to $1000 per accident)· If you are hospitalized, they may pay for boarding for your dog. (up to $1000 per accident)
· If you have to cancel or cut a holiday short because your pet suffered an “Accident or illness” they will pay for any travel and accommodation expense (up to $1000 per accident) · Cover the cost of any Treatment for the teeth and gums for preventive care or as a result of an eligible dental Illness ($300 per year) | ||||||||||||||||||||||||||||||||||||||||
| More info- Policy papers and sample | http://www.caapets.com/pdf/pw_caa.pdf | http://trupanion.com/canada/-/media/files/trupanion/pdfs/trupanion-sample-policy-2016.pdf?la=en-CA | http://www.petsecure.com/pdf/PW_PS.pdf | ||||||||||||||||||||||||||||||||||||||||
| Ratings from petinsurancereview.comNote that they make money by having people get quotes through their website. (trust the reviews with a grain of salt) | N/A |
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| JUST IN CASE you are tempted by their Basic Plan because of the lower premiums, here are the Main Cons that you should consider- | Basic plan called COMPACT PLAN· It won’t cover illnesses developed by drinking contaminated/ stagnant water, which is a common accident that most dogs get into
· They don’t state clearly upfront in your quote that joint/arthritis issues are not covered · They also do not cover soft tissue or muscle inflammation · Do not cover any consequential damage as a result of any accident e.g. if your pet develops liver damage due to poisoning, future treatments of that liver damage will not be covered. · Vague on not paying for accidents due to your pet’s known behavioural problem. | ||||||||||||||||||||||||||||||||||||||||||
** It is especially relevant to point out that the language for BCAA and Petsecure were almost identical for their policy document. This is due to the fact that they are ALL underwritten by Western Financial Insurance Company. On the other hand, Omega General Insurance Company (Canada) underwrites Trupanion.
Out of these 3, choose the company that has the following:
- highest accident/ illness limit,
- covers more issues,
- has the lowest deductible and
- best track record of processing claims positively.
As pet owners did we get dog insurance?
We had pet insurance for Shinji but we did consider the option of banking that cash into an account for Shinji. Consequently, we used his bank account for his food, travel/daycare, and supplies.
There had been times that we had considered taking him off insurance because the deductible or the premium had risen. However, we’ve opted to stay with the insurance as he aged. Honestly, we are glad we have because routine surgeries can cost at least $1500 excluding tests. Even minor issues like taking out lumps to ensure they are not cancerous are expenses that a lot of pet owners will have to decide about. You’d have to pick and choose what would be considered serious enough to warrant a vet visit.
Therefore, whatever your decision, we’d advise that you start early. This will give you time to grow decent savings by the time anything unfortunate happens. In the case of insurance, it will therefore ensure that you are covered for a wider range of issues. For adoptions, make sure to get the whole health history as this may probably impact the pre-existing clause.
*Disclaimer- Note that this is not an exhaustive exercise. Let us know if we missed any info.
Let us know if you have pet insurance? Why did you choose that dog or cat insurance? Consequently, has the pet insurance company lived up to expectations? Above all, are your pissed off with the claims process and premiums for your pet insurance.
