Some advertisements and offers on this page are from advertisers who pay us. That may influence which products we write about, but it does not affect what we write about them. Here's an explanation of how we make money and our Advertiser Disclosure.
Key takeaways:
-
Pet insurance can pay for veterinary services that are covered by the policy, such as pet surgeries, X-rays, and medical treatments.
-
Most pet insurance works by reimbursement, which is when you pay the vet bill and then submit a claim.
-
All pet insurance policies have at least one type of waiting period before coverage begins.
In many households, pets are family. And in the same way health insurance covers the care of family members in case of illness or accidents, many pet owners are turning to pet insurance to provide the same sense of security for unexpected pet medical bills.
Only about 4% of dogs and less than 1% of cats are covered by pet insurance, according to the North American Pet Health Insurance Association. Understanding how pet insurance works can help you decide if it’s a smart purchase for your dog or cat.
In this article:
What is pet insurance?
Pet insurance reimburses you for certain kinds of medical treatment, medications, and sometimes other unexpected pet care costs. Most pet insurers offer only coverage for dogs and cats. And generally, pet insurers won’t cover preexisting conditions, meaning problems that were present before the policy was purchased or that started during the policy's waiting period.
Learn more: The best pet insurance companies of 2025
How does pet insurance work?
Pet insurers usually offer a few types of policies and a variety of reimbursement methods to choose from. Typically, if you have pet insurance and your pet has an injury or isn’t feeling well, you can take them to any licensed vet or emergency clinic and then submit a claim. You’ll wait to be reimbursed by the pet insurer for the amount your policy covers, unless your pet insurer offers a system for direct payments to the vet.
Types of pet insurance policies
Many pet insurers offer two main types of policies and an optional add-on for routine wellness care.
Accident-only policies
Accident-only coverage is limited to treatment for accidents, such as a fall. These policies can cover more than severe cuts and broken bones. They also apply if your pet has swallowed something they shouldn’t have, including foreign objects or potentially poisonous substances.
Accident and illness policies
Accident and illness coverage is a more comprehensive approach to pet insurance that reimburses you for treatment for pet accidents like a broken paw, illnesses (such as skin infections), diseases (such as cancer), and hereditary and congenital conditions. All policies have exclusions for certain treatments and conditions, so make sure to read the exclusions section of your policy.
Pet wellness plans
Wellness plans are not technically insurance, but they're usually offered as supplemental coverage to a pet insurance policy. Wellness plans generally reimburse specific amounts for preventive care services for pets, such as immunizations, dental cleanings, and routine annual exams.
How pet insurance reimbursement works
When you buy pet insurance, you’ll generally have options for the annual limit, deductible, and reimbursement percentage (or coinsurance). When you get a pet insurance quote, you’ll be able to adjust these reimbursement levels to see how they affect the monthly premium.
What is a maximum annual payout?
A maximum annual payout for pet insurance is the most the policy will pay during the policy year. If your pet’s veterinary costs exceed the maximum limit for the year, you’ll have to pay any additional bills out of your own pocket. These limits generally don’t roll over, so when a new policy period starts, your maximum annual payout resets.
Annual coverage limits can be as low as $2,000 or as high as unlimited.
What is an annual deductible for pet insurance?
Pet insurance has three potential types of deductibles:
-
Annual deductibles require you to pay a certain amount toward vet bills every policy year before coverage kicks in. Most pet insurance policies have annual deductibles.
-
Per-incident deductibles require you to pay a deductible each time you visit the vet for a new condition.
-
Lifetime per-condition deductibles require that you pay the deductible only once for each new condition for the pet's lifetime. For example, Trupanion has a lifetime per-condition deductible.
What is a reimbursement percentage?
The reimbursement percentage (much like coinsurance) is the portion your insurer will pay of your pet’s eligible medical costs once any deductible is met. In some cases, the reimbursement will be calculated first and then your deductible will come out of the remaining bill. Most pet insurance companies offer reimbursement rates of 70%, 80%, or 90%.
For example, let’s say your pet has accident and illness coverage with a $300 annual deductible and 90% reimbursement. Your dog has a severe ear infection that requires multiple visits and medications to the tune of $750. If you haven’t paid any of the deductible yet, you’d pay $300 out of pocket, and your pet insurance would reimburse you for $405 (90% of the $450 bill remaining).
Selecting a higher reimbursement percentage for claims will translate into a higher insurance premium. And some pet insurance companies may limit choices for deductibles and reimbursement rates, depending on your pet’s age and health.
What does pet insurance cover?
Pet insurance covers medically necessary treatments, but coverage varies by policy. Services and treatments that are covered can include:
-
Hereditary and congenital conditions
-
X-rays, ultrasounds, and CT scans
-
Cancer
-
Dental accidents
-
Prescription drugs
-
Behavioral therapy for issues like separation anxiety
-
Alternative therapy, such as acupuncture, hydrotherapy, and chiropractic care
What does pet insurance not cover?
No matter what type of coverage you have, pet insurance typically does not cover anything deemed a preexisting condition, elective procedure, or experimental treatment. Here’s a snapshot of other expenses usually excluded from pet insurance:
-
Injuries from intentional acts
-
Injuries and illnesses related to breeding
-
Boarding and transportation costs
-
Anal gland expression
-
Conditions related to racing, such as sled racing
-
Spaying or neutering
Are there age limits for buying pet insurance?
Some pet insurance companies have both minimum and maximum age limits for buying a new policy. It’s common to require that a puppy or kitten be at least 8 weeks old to be eligible for coverage, although a few pet insurers, such as AKC, MetLife, and Trupanion, don’t have minimum age limits.
And while you may have heard your dog or cat is “too old” to qualify for pet insurance, quite a few pet insurers have no upper age limit to qualify, but might offer only reduced coverage.
Does pet insurance require an initial vet visit?
Some (but not all) pet insurance companies require an initial vet visit before or soon after buying a policy. For example, Embrace pet insurance requires an exam by a veterinarian 12 months before the policy start date or 14 days after.
In some other cases the pet insurance company will want to see the pet’s medical records but won’t require an exam.
How do pet insurance waiting periods work?
Unfortunately, pet insurance is not like auto insurance. You can’t just roll up and get immediate coverage. All pet insurance policies have some sort of waiting period, such as:
-
For accident coverage, you may need to wait anywhere from one to 15 days for coverage to start.
-
For illness coverage, the waiting period is typically 14 days.
-
Waiting periods can extend even longer (often up to six months) for cruciate ligament or other conditions.
-
Wellness plans typically have no waiting period.
What does pet insurance cost?
The average annual premium for accident-only coverage was $116.11 for cats and $204.16 for dogs, according to NAPHIA’s 2023 report. For accident and illness coverage, average premiums were considerably higher at $383.30 for cats and $675.61 for dogs. Adding a wellness plan to accident and illness coverage increased average annual premiums to $625.99 for cats and $1,263.39 for dogs.
Factors that affect pet insurance costs
In addition to the type of coverage you choose, these factors affect pet insurance quotes:
-
Location: This is based on your local costs for vet care.
-
Pet breed: Breed affects health and life expectancy, so it also affects pet insurance premiums.
-
Pet gender: Female pets can be cheaper to insure.
-
Pet size: Larger breeds cost more to insure because they tend to have more claims.
-
Pet age: Older pets are more likely to develop chronic conditions or illnesses.
And last but not least, the cost of pet insurance will also depend on your maximum limit, deductible, and the reimbursement rate you choose.
Are there pet insurance discounts?
Fortunately, many pet insurance companies offer multi-pet discounts of 5% or 10%.
Some pet insurance companies offer military discounts.
Embrace’s Healthy Pet Discount program offers a 5% discount for each pet the first year you don’t have any pet insurance claims and a 10% discount for the second year. MetLife has a similar program called the Healthy Pet Incentive that reduces your deductible every year you don’t have a claim.
How do pet insurance claims work?
Pet insurance claims are fairly straightforward. In most cases, you’ll submit a claim after you’ve paid the medical bill at the vet. Usually, you’ll need to submit proof of payment, a detailed invoice, and answer a few questions about the claim.
The pet insurer will send reimbursement payment, sometimes directly to your checking account.
How long do I have to submit a claim?
The window to submit a claim is usually pretty generous. You’ll have anywhere from 90 to 270 days from the time of treatment, service, or office visit to file a claim with your pet insurer.
If you’d like to speed up reimbursement time, most pet insurance companies recommend using a direct deposit option linked to a bank account.
Pet insurance that pays the vet directly
If fronting the costs of your pet’s vet bills is not ideal, look at pet insurance companies that can pay a vet directly. Pet insurers that offer direct vet pay include:
-
ASPCA
-
Healthy Paws
-
Pets Best
-
Trupanion
Even if your pet insurance company doesn’t advertise that it can pay the vet directly, it’s worth asking in advance if you know you have a large vet bill coming up, like surgery. Some pet insurers will pay the vet directly on a case-by-case basis for prohibitively expensive vet bills.
Can I cancel my pet insurance?
You can cancel a pet insurance policy by contacting the company directly. You’ll generally get a prorated refund for the remainder of the policy term. You can also wait until the policy term ends and then notify the insurer you’re not going to renew.
Some insurers require notice in writing, while others will process a cancellation request by phone or online. Look over your policy and the insurer’s website for more details, including any information about potential fees for early cancellation.
Free look periods
Free look periods function like a money-back guarantee. For a short period of time after you purchase a pet insurance policy, you can cancel and receive a full refund as long as you haven’t filed any claims.
Pet insurance free look periods are usually 30 days, although Liberty Mutual pet insurance has a short period of 10 days.
Is pet insurance worth it?
Deciding if pet insurance is worth it depends entirely on your financial situation, your pet, and your risk tolerance.
After getting pet insurance quotes, calculate the annual cost of pet insurance over a few years. Then calculate the potential cost of a large vet bill. Consult with your veterinarian about what kinds of vet costs your pet’s breed can expect. For example, is the breed prone to certain chronic conditions?
Compare future pet insurance payments to the potential cost of a large bill. If you’d like a financial safety net for unexpected vet bills, pet insurance can be worth it.
Learn more: How insuring a pet may save money in the long run
How pet insurance works FAQs
What veterinarians take pet insurance?
Fortunately, pet insurance doesn’t work based on a provider network. You can submit claims for bills from any licensed vet in the U.S., and some pet insurers also cover other countries, such as Canada.
What pets can be insured?
Most pet insurance companies will insure only dogs and cats. MetLife and Nationwide insure exotic pets, such as lizards and birds.
Is pet insurance tax-deductible?
Pet insurance costs, including premiums, are generally not tax-deductible, but there are some exceptions. If your pet is a service or emotional support animal or you’re fostering a pet for a 501(c)(3) adoption organization, you may be able to write off certain expenses.
Some types of working or performance animals may be tax-deductible if you use them for a business, but you’ll need to carefully document both their income and expenses to submit to the IRS.
Amy Danise edited this article.
