What Veterinary Nurses Need to Know About Pet Insurance

Many years ago, my sweet cat became very ill. Not only was I worried about what was wrong, but I was also quite concerned about how I would afford his care. Fast forward several years, and I found pet insurance. Suddenly there was another option—a way to care for my pets with fewer limitations.

So, when my lovable dog recently became ill, I didn’t worry when I received the cost estimate. I could give him the best care without having to agonize over how I would pay for it. Pet insurance gives me the freedom to care for my pets in a way that I never could before. But how do you know if pet insurance is right for you and your clients?

Pet insurance allowed the author to prioritize quality of care over cost considerations for her cat Hercules and dog Miles.

Pet insurance allowed the author to prioritize quality of care over cost considerations for her cat Hercules and dog Miles.

Many people don’t know that pet insurance exists; of those who do, some believe the benefits aren’t worth the cost or that it isn’t affordable. As people become more aware of the benefits of pet health insurance, more options become available, which can become overwhelming for some. The reality is that major medical issues, accidents, and emergencies often happen suddenly, without warning, leaving pet owners struggling to afford veterinary care. As professionals entrusted to care for beloved pets, it often falls to veterinary team members to help clients understand the cost of care and how they can finance it.

The Rising Cost and Slim Margins of Veterinary Care

The cost of veterinary care has increased significantly in the last 10 years.¹ There are more pets in American homes than ever before.² A greater demand for veterinarians and other veterinary professionals has resulted in staffing shortages, leading to increasingly competitive wages, an expense that gets passed on to pet owners. Specialty, urgent, and emergency care and advanced technology drive clinic expenses even higher. The average cost to run a 2-doctor practice has been estimated at approximately $35 000 per month, the bulk of which is used to meet the overhead cost of running the clinic.³ Most small clinics average a 12.5% profit margin, while emergency and specialty clinics average a 15% profit margin.⁴ To put this into perspective, the profit margins for some of America’s most successful businesses, such as Diamondback Energy, Johnson & Johnson, and Airbnb, average 37% to 48%.⁵ We know how much it costs to run a successful clinic, but helping pet owners understand may help them accept the prices set for services. It may also garner some empathy for those of us in the field, highlighting the fact that very little of the revenue ends up in our pockets. But understanding the cost does not guarantee affordability, which is why pet insurance could be an excellent option for many pet owners.

The Client Cost of Accidents and Emergencies

While routine care for a well pet is something most owners can plan for, they should also have a plan in place for when the unexpected occurs. Matthew Crawford-Jennings, DVM, an emergency and critical care resident at the North Carolina State University Veterinary Teaching Hospital, outlines in TABLE 1 estimates given to clients for common accidents and emergencies.

Would your everyday client be able to afford these prices? One could search for less expensive care, but cheaper veterinary care may equate to a lower quality of care; the delay in treatment in an emergency could be harmful to pets. Would a client need to make a life-or-death decision based on the cost of care? How many of us have watched our clients face this impossible ethical dilemma? A recent survey questioned how the cost of veterinary care impacts peoples’ lives, with results presented in BOX 1.⁶

The Pros and Cons of Veterinary Tourism

Some pet owners do try to seek less expensive care by shopping around; some are even turning to veterinary tourism. In 2018, Anna Ginsky created a veterinary tourism company when she found that she could have her pet’s dental work done in Tijuana, Mexico, for far less money than in the United States.⁷ Mexivet Express connects pet owners with team members who guide them through the steps to have their pet cared for by a Mexico-based veterinarian. Mexico’s lower labor and real estate costs compared to those in the United States, as well as the fact that veterinarians there are not required to hold medical malpractice insurance, means that these clinics can charge much less for routine dental care, simple surgeries, treatment for some cancers, and more.

But is this really the best option? Consider the stress on the pet, who has to journey to and from Mexico with a stranger. Pet owners must also be aware that the veterinary clinic they choose may employ different standards of veterinary care than they might expect, as well as the possibility of hidden costs should complications arise. This option may work for some, but most pet owners want help a little closer to home.

The Role of Pet Insurance

Enter pet insurance. The first pet-specific policies were drafted in the 1890s by Claes Virgin, mostly for horses and livestock.⁸ The first policy for a dog was created by Nationwide in 1982 (then called veterinary pet insurance) for TV legend Lassie.⁸ As of 2023, just shy of 5 million out of roughly 150 million U.S. pets are covered by pet insurance.⁸ It has become widely available, and it can help mitigate the cost of veterinary care, especially in cases of unexpected illness or emergencies. Most policies are paid monthly, offer direct reimbursement to policyholders, and have no limitations on in-network versus out-of-network providers. Some companies even pay veterinary clinics directly.

Pet insurance allows pet owners to choose care based on their desire to make their pet feel better, rather than the cost of that care. For veterinary clinics, from a purely financial perspective, pet insurance means clients will authorize more extensive care and be able to pay for it. From a perspective of someone working in the veterinary profession, the ethical and emotional toll of having to lower our standard of care or to be asked to end a pet’s life due to financial issues leaves most veterinary professionals feeling unsatisfied, depressed, and often guilty. In a profession plagued with mental health issues and high suicide rates, wouldn’t it be amazing if we could always follow our passion to provide the highest-quality, compassionate care for pets? Pet insurance offers a step in that direction.

How Pet Insurance Works

The policies mentioned in this article are mainly for dogs and cats; however, policies may be available for horses and exotic pets through a select few companies. Most pet insurance companies offer fully customizable plans, allowing customers to choose the deductibles, coinsurance rates, and policy limits that best fit their needs. Premiums are calculated based on many factors, including a pet’s age, breed, and geographic location. Many companies provide coverage for dental illness and injury; bodily injuries; alternative therapies; and illness, including behavioral, congenital, and hereditary conditions (after company-specific waiting periods). Specialty and emergency care, advanced diagnostics and imaging, and even some prescription diets may also be covered. It is also becoming more likely for plans to offer coverage for curable preexisting conditions, after a specified asymptomatic waiting period.

Some exclusions should be considered before clients choose a plan. Some plans have an upper age limit, and some base plans do not cover examinations. Some preexisting conditions will never be covered, and waiting periods for accidents, illnesses, and a variety of other conditions may vary. Waiting periods are company-specific and highly variable. Consistent exclusions among most companies researched include any care relating to obedience training; breeding and whelping; elective, cosmetic, and experimental procedures; genetic testing or technology; and nonveterinary fees (e.g., bank fees, taxes).

Select policies will not cover bilateral conditions (those that may affect either side of the body; e.g., hip and elbow dysplasia, cataracts, luxating patellas, cruciate ligament injuries). If a pet was diagnosed with a cruciate ligament injury to a knee prior to a policy taking effect, it will not cover the same condition in the other knee at any future date. Some policies may fully deny coverage for these conditions, even if the first incidence occurs after the policy takes effect.

For most companies, wellness or routine care coverage may be available. For puppies and kittens, these plans are worth looking into. Puppies receive 9 to 18 vaccinations⁹ and kittens 7 to 12 vaccinations between 8 weeks and 1 year of age.¹⁰ Add several puppy or kitten exams, spay or neuter surgery, and parasite preventives, and suddenly a client’s wallet is decidedly lighter. A wellness plan may lessen the out-of-pocket expense of caring for a new pet.

Selecting a Pet Insurance Plan

So how does a client choose the company that’s right for them when there are so many options? Discuss with clients the need to research the coverage options, including benefits, limitations, and exclusions that fit their budget and coverage preferences. Encourage clients to compare the plan(s) offered (e.g., accident only, accident/illness), premium rates, deductibles, coinsurance, and policy limits. Have clients also check for added incentives; multi-pet, military and first responder, and professional discounts may be offered, as well as savings if a client pays quarterly or annually. Guide clients to explore what customers are saying about the companies; their experiences may inform a client’s decision. A client may also inquire whether the policies are guaranteed renewable (i.e., insurer cannot cancel a policy or refuse to renew due to certain conditions or their pet’s age).

Something else to check out: Some employers may offer pet insurance (or discounts on pet insurance) as an optional benefit. For example, a company called Pet Plan works almost identically to a person’s own employer-provided health insurance. The employer chooses the variables, such as deductibles and plan limits, and the pet owner purchases a policy directly through their employer. Another company, Pet Partners, may also be integrated with any benefit or administrative software, allowing payroll deductions and the opportunity for the employer to contribute.

There are countless online comparison tools clients can use to conduct their research, such as Pawlicy Advisor (pawlicy.com) and Wag! (wagwalking.com). While these tools may help narrow down a client’s choices, most include only a selection of companies. This article provides general information on many available insurance companies, so you can better advise clients. TABLE 2 shows how some of the most popular and/or well-established companies measure up to each other with a few caveats outlined below.

• Deductibles with Trupanion are charged per incident, not annually—excellent news for chronic conditions; however, for accidents or transient illnesses, this may not be as cost-effective.
• Trupanion, Prudent Pet, AKC pet insurance, Figo, Healthy Paws, Careplus by Chewy, and Lemonade do not cover exams or only cover exams if this feature is added to the policy for an additional cost.
• Trupanion, Careplus by Chewy, Pet’s Best, Healthy Paws, and Fursure have options to pay the veterinary clinic directly.
• Metlife offers a multi-pet shared deductible option for up to 3 pets.
• ASPCA, Pet Assure, and Nationwide offer coverage for horses.

Summary

In today’s financial climate, it is so important for pet owners to plan for unexpected expenses. Taking excellent care of one’s furry family member should not have to depend on how much it will cost. With pet insurance, it doesn’t have to. It is now possible for a client to choose a plan that is completely tailored to their and their pet’s unique needs and circumstances. With a bit of research and planning, a client’s pet can be more protected than you ever thought possible.