Lifetime pet insurance guide
All you need to know about lifetime pet insurance
By Kevin Pratt on Wednesday 25 May 2016
Many households dote on their pets, often treating their cat, dog or rabbit as one of the family. But what happens when a beloved animal falls ill or is injured in an accident?
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You can’t rush your pet to the local hospital and receive free treatment on the NHS, which is why most people take out pet insurance.
A decent pet insurance policy typically covers the medial expenses if your pet is ill or injured. You can also usually add on a range of other benefits such as third party liability (if your pet causes an accident or injures someone or damages their property), depending on your needs and budget.
Types of cover
Pet insurance plans can be divided into two broad categories: lifetime and non lifetime policies. And it’s important to understand the difference or you could end up with a poorly pooch and a big vet’s bill.
Lifetime pet insurance is usually the most expensive because it offers the most comprehensive protection. A lifetime policy is essentially designed to pay for any chronic or recurring condition during the pet’s lifetime. This is attractive because, with non lifetime policies, animals might be refused cover once they reach a certain age, or because of pre-existing medical conditions.
So lifetime cover sounds straightforward, but it can be confusing. For a start, lifetime pet insurance does not offer unlimited cover, so you need to read the small print carefully to see how much your policy will pay out in certain situations.
You also have to renew the cover every year. It is still a 12-month contract, which means the insurer could technically turn you down – although this would be an unusual step.
Lifetime pet insurance is usually the most expensive because it offers the most comprehensive protection.
Variations on a theme
There are two types of lifetime cover. Some policies set an annual limit per condition, say £7,000. So, if your dog developed arthritis, the maximum you could claim for medical treatment for the disease in any one year would be £7,000.
In other words, if the vet’s bills one year came to £6,500 you would be covered by the policy. But if the bill for the year came in at £8,000, you would have to pay £1,000 out of your own pocket.
At the end of the year, assuming you renewed the cover, the dog would continue to be insured for arthritis, with the limit on what you could claim being reset to £7,000. So if the animal was still receiving treatment, you could therefore put in another claim for up to £7,000 – and so on, year after year.
This is another distinct advantage of the lifetime policy – treatment can continue across policy ‘years’ – it doesn’t have to stop as it would at the end of a single, 12-month policy.
Remember that the limit applies to each condition. If your pet was unfortunate enough to contract both arthritis and diabetes in the same year, you could claim up to £7,000 (in this example) for the treatment of each illness.
The second type of lifetime policy sets an overall or lifetime limit for each condition.
If the lifetime limit is, for example, £50,000, you would be able to claim up to £50,000 for each condition until the pet died or you chose not to renew the policy.
Let’s go back to our arthritic dog. If we assume the animal were treated for arthritis for 10 years and the total cost came to £45,000, the policy would pay out. But if the bill totaled £53,000, the owner would have to stump up £3,000.
So, the advantages of a lifetime policy are the continual cover for a particular condition and the high limits. A more basic pet plan, such as a time-limited policy, would only cover the animal for a particular condition for a set period of time, normally 12 months. The condition would then be excluded. The maximum payout would also normally be lower.
If you are concerned about the high medical cost of a chronic illness, then lifetime pet insurance could be a sensible choice, particularly if you have a pedigree pet. But as with all pet insurance policies, there are exclusions to lifetime plans. There might, for example, be age limits. Some policies also exclude hereditary conditions.
Also, and as you might expect, the premiums for lifetime pet cover can be high relative to 12-month policies. But you might decide this price is well worth paying because of the additional policy features.
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Lifetime pet insurance
Learn about lifetime pet insurance policies, typically seen as the premium cover option for your animal.
- The premium pet cover option – at a premium price
- There should not be a time limit placed on treatment, but there may be a financial cap
- Cover will lapse if you don’t renew your policy
- All policies differ so read terms and conditions and beware of exclusions
What is a lifetime policy?
A lifetime policy is one of the four main categories of pet insurance.
It’s typically seen as the premium option, offering the most extensive cover for your pet – that privilege coming, of course, at a premium price.
In contrast, accident-only and time-limited policies are at the lower end of the pet insurance scale, while maximum benefit policies are a mid-range cover option.
As the name suggests, lifetime policies should give your pet protection for his or her lifetime, so long as the policy is renewed every year.
As opposed to time-limited policies, a cover-for-life option means that if your animal gets a certain condition, vet fees and treatment costs will be covered beyond the initial 12 months.
Are all lifetime policies the same?
Lifetime products will have different conditions depending on the policy and the provider you opt for.
Some insurers limit cover on a per-condition, per-year basis, meaning that you might only have a specified amount of cover for each condition in a year.
If this limit was set at, for example, £1,000, your policy would cover treatment each year up to this amount.
The following year the cover would then be renewed, for up to the same amount.
Other lifetime policies might limit payouts on a ‘per year’ basis.
If the maximum cover was £5,000, for example, this would have to cover every potential condition the animal could get, limiting the individual payout for each condition.
Some lifetime policies might be on a ‘per condition’ basis, which would give your furry friend cover up to a certain amount for every condition, regardless of the number of years over which the treatment is received.
Exclusions on ‘lifetime’ cover
Do make sure you read the small print because, despite their name, some lifetime policies will not actually cover your animal for its entire lifetime.
Some policies exclude older animals which, in the case of certain breeds, include dogs aged five or six.
So it’s best to double-check the terms your insurer provides, to make sure that lifetime cover is exactly that.
On the other hand, the cover might include ‘extras’ which you had not considered, things such as physiotherapy, hydrotherapy and special diets.
Life Cover Insurance For Dogs
It makes sense to purchase a life insurance policy to cover yourself or your spouse if you want to ensure that your family is protected financially in the event of a tragedy. Some people even purchase life insurance for their children to enable them to secure low-cost policies that can stay with them into adulthood. But what about your family pets? After all, Fido and Whiskers may be bona fide members of your family too. Should you buy life insurance policies for them as well? If you want to find out more details related to your situation contact a local insurance agent.
In most cases, the answer is “No.” It is rare for animals to have income potential, so although your pet may have incalculable value to your family, in the eyes of insurance companies, it is worth only its value on paper. That is to say, the value assigned to it will be either the price you paid to purchase it, or the cost to replace it with a pet of the same breed. Emotional value does not come into play. There are exceptions, of course. Rare breeds, show dogs, and famous pets frequently have an assessed value that greatly exceeds their purchase or replacement price.
Costs Associated with Pet Funerals
- Cost to cremate a pet: $60 to $150
- Cost for an urn for a pet’s ashes: $35 to $400
- Cost for a burial plot in a pet cemetery: $400 to $600
- Cost for a pet casket: $50 to $500
When a beloved pet passes, it can be very hard on the family who loved it. Many people feel compelled to provide their pet with a proper burial or funeral service. Unfortunately, these costs can often run rather high. You may therefore think that purchasing a life insurance policy for your pet can help to alleviate these costs. However, these policies have limits that make them a good financial decision only for a small handful of pet owners.
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What Are the Limitations of Pet Life Insurance?
Pet life insurance is different from pet health insurance. It is designed to cover unexpected deaths such as those that may result from an accident or sudden illness. Your insurance company can provide you with compensation in the amount of your pet’s value, as determined by its purchase or replacement cost, or its assessed value. Some insurers will also offer to cover euthanasia, burial or cremation costs in exchange for higher premiums.
However, not all pet deaths are covered. You are likely to face a number of policy exclusions, including such things as:
- Hereditary diseases: Some purebred dogs are prone to serious illnesses, and deaths caused by these illnesses will not be covered by dog life insurance. For example, Lhasa Apsos are prone to develop hereditary kidney disease and inguinal hernias; Irish Setters are vulnerable to hemophilia and certain neurological disorders.
- Preexisting conditions: Your insurance company will require a health assessment by a veterinarian before issuing a policy. If your pet already suffers from a serious illness, whether hereditary or not, you may not qualify for coverage.
- Old age: Pets age, and their life expectancy is shorter than that of humans. Pet life insurance limits coverage to a given time span that provides coverage while your pet is in its prime of life. The coverage is therefore limited to accidental deaths and sudden illnesses.
Most Popular Dog Breeds and Their Life Expectancy
- Labrador Retriever , 12 years
- German Shepherd, 10 years
- Golden Retriever, 12 years
- Beagle, 12 years
- Bulldog, 6 years
- Yorkshire Terrier, 14 years
- Boxer, 9 years
- Poodle, 12 years
- Rottweiler, 9 years
- Dachshund, 13 years
Life Insurance for Dogs
Smaller dogs tend to have longer lifespans than larger ones. The time limits of your dog life insurance policy will depend on the breed of dog you are insuring.
Typically, dog owners who can benefit from purchasing a dog life insurance policy for their pets own breeds that cost a lot of money. Others that may want to consider a policy are those whose pets compete in Best of Show events or are famous—such as those who have roles on TV shows or who have become popular on the Internet—since these canines can provide a source of income for their owners.
Paris Hilton reportedly shelled out $25,000 for two teacup Pomeranians. While these dogs may have a value that justifies life insurance coverage, if you have the money to pay that much for a dog, you probably have enough to easily cover funeral costs without the need for pet life insurance.
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Protect your family pet against costly accidents and illnesses.
Life Insurance for Cats
Cat owners tend to be less likely than dog owners to seek life insurance policies for their pets. At fifteen years, the average lifespan of a cat is longer than that of a dog, so cat life insurance policies often have longer coverage periods. Some cats, such as Persians, Bengals and Savannahs, can cost several thousand dollars.
“Grumpy Cat” is an example of a cat that might be worth purchasing a life insurance policy for. This cat, named Tardar Sauce, was born with an underbite and dwarfism, which work together to make it appear that the cat is always scowling. Grumpy Cat quickly grew famous as a Web meme, and her owner has made millions of dollars through commercial projects that have starred her cat. This is one example of a pet that would be assessed at a value far greater than its purchase price.
Is Pet Life Insurance Really Necessary?
According to Harris Interactive, Americans spend an average of $1,191 a year on their pets. The largest expenses are food, at $476, and healthcare costs, at $425. There is no reason to incur the extra cost for cat or dog life insurance unless your pet has a high assessed value.
The American Pet Products Association reports that there are approximately 86 million cats and 78 million dogs living with families in the United States. While many of these families might benefit from purchasing health insurance policies for their pets, very few would benefit from purchasing pet life insurance policies.
With a few exceptions, it would make more financial sense to simply put the money you would spend on a pet life insurance policy into a savings account set up specifically for the purpose of covering your furry friend’s eventual burial or cremation costs.
Making the Decision to Get Pet Life Insurance
If you feel that your pet has an estimated value that justifies the cost of a pet life insurance policy, you may want to learn more. A local Trusted Choice® agent can help you find one of the few insurance companies that offer this type of policy, so you can review prices and crunch numbers. These agents can also serve as a resource when you are shopping for any type of coverage, such as auto, home, or life insurance policies. You can get more information by contacting an independent insurance agent near you.
10 Best Pet Insurance of 2018
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In Canada? See our list for the best pet insurance in Canada
What is Pet Insurance?
Pet Insurance costs $38-70/month & covers a significant portion of vet bills that can cost $5-$10k.
Pet insurance – or veterinary health insurance for your cat or dog – is about being prepared for the unexpected. Having a plan with a top-tier company gives you financial protection; in the event you’re faced with an expensive $2,000-6,000 surgery for your pet, a good insurance policy will pay up to 90% of that vet bill.
What questions should you ask? And which companies have the best plans for your pet? These are important questions, but getting good answers can be confusing. To help you find the company that’s best for you & your furry friend, our editors have done the work for you.
How to choose the right pet insurance
Coverage & Benefit Limits are the most important factors to consider when comparing pet insurance.
Whether your pet needs a couple stitches put into an injured paw or if they’re facing a serious life threatening condition like cancer, you want a plan that has broad coverage & has few exclusions. After all, pet insurance is for the unexpected, and while some breeds are pre-disposed for specific health problems, the only thing you can really expect as a pet parent is that the unexpected will happen.
An exception to the broad coverage rule is wellness coverage, also referred to as preventative care, which covers routine procedures such as checkups & vaccinations. Despite sounding like something you might want to have included as part of your pet insurance plan, wellness coverage is not a good deal.
There’s a reason 82% of policies in the US do not cover wellness or preventative care. Wellness coverage drives up your monthly premiums & makes it so you pay more over the life of your pet for inexpensive procedures that are cheaper to pay out-of-pocket.
In general, we don’t recommend wellness coverage because you’re usually better off paying out-of-pocket.
The best pet insurance should cover accidents and illnesses. These include broken bones, swallowed objects, cancer, diabetes, ear infections and numerous other conditions.
Accident only coverage’s main benefit is savings. They are usually the cheapest policies and will cover your pet for all manner of mishaps from getting bit by other animals to poisoning, but they do not cover illnesses or diseases.
Wellness plans cover routine procedures such as annual exams, vaccines, flea and heartworm prevention. We don’t recommend this because these expenses can be budgeted for annually.
- Accidents & Illnesses
- Hereditary, Congenital, & Chronic Conditions
- Diagnostic Tests
- Emergency Care
- Specialist Care
- Prescription Medication
- Most plans will allow you to visit any licensed vet or veterinary hospital. Other companies will restrict you to an in-network provider, we recommend avoiding these plans.
- Most companies will cover pets anywhere within the United States.
- NAPHIA, the North American Pet Health Insurance Association, can be an invaluable resource for finding a reputable and trustworthy pet health insurance company from their membership.
Depending on the Pet Insurance company, your plan may provide unlimited lifetime benefits or your benefits may be capped on an annual, lifetime, or per-condition basis.
We prefer companies that have unlimited lifetime benefits, meaning plans that have no payout cap. Veterinary Care costing $5,000 or more is becoming more common and having a plan without limits means you can give your pet the best care possible year after year. However, you may find that a plan with a payout cap works best for your needs and price point. Just remember to plan for the unexpected.
- 1 Unlimited Lifetime* Highly Recommended
After you pay your deductible, there will be no upper limit the company will pay to cover your pet’s medical bills
2 Annual Maximum
Some companies will cap payouts on an annual basis (e.g. $15,000/year). Once you reach that limit, you will no longer be reimbursed for treatments that year.
3 Annual Per Incident
This is the maximum dollar amount the company will pay for a particular illness, condition, or procedure in a given year.
4 Lifetime Maximum Least Favorite
This is the maximum amount the company will pay out either in total or per condition for the lifetime of the pet. If you pet has a chronic condition such as athma or allergies, you can quickly hit the benefit limit.
Unlimited Lifetime Benefits!
Deductibles & reimbursements
Your plan deductible is how much money you will have to pay out of pocket before the pet insurance company starts paying.
Reimbursement is the percent of the vet bill your insurance will pay. Most plans will allow you to customize the deductible and reimbursement options.
Maximum payouts: Unlimited
For illustration purposes only. Rates vary by pet breed and geography.
Data compiled from multiple providers based on a 1yr old puppy.
Deductibles:Higher deductibles ($1,000 for example) translate into lower monthly premiums. A deductible is not to be confused with a co payment. Let’s say you have a $500 annual deductible. During the course of that year you will have to pay 100% of vet bills for the first $500. After which your pet insurance plan kicks in 80% of all medical bills (assuming you’ve chosen a reimbursement level of 80%). You then get a $1,000 vet bill for surgery. Pet insurance pays $800 and you pay $200. The $200 is your co payment.
Deductible Types:There are generally 3 types of deductible schedules offered by pet insurance companies. Annual deductibles include all conditions, accidents, and illnesses in a given year under one umbrella. Once the deductible is met, the company starts paying according to the given reimbursement model. When the year is over the deductible resets. Per Condition Lifetime separates varying deductibles by condition. Once that deductible is met the company pays out for that condition according to the given reimbursement model for the rest of the pets life. Per Condition Annual is the same as lifetime only the condition deductible will reset annually.
Reimbursement Model:Companies typically employ three different options. Actual cost means that, once you have satisfied your deductible, you will be paid a percentage of your actual veterinarian bill. Most plans that use this model allow you to choose the percentage. Benefit Schedules are when the company has predetermined a fixed amount you will be reimbursed for each procedure, condition, or illness. These types of plans have somewhat fallen out of fashion in favor of actual cost reimbursement. In the past, consumers would often be surprised to find out a given condition had low $ amount restriction on reimbursement. Although we recommend against benefit schedules, if you are considering a plan with one, we recommend you scrutinize the contract for benefit limits on conditions common in your pet’s breed. The least used model is Usual & Customary. This means the company has determined a fixed amount you will be reimbursed for each procedure based on your location.
Premiums depend on a multitude of factors. Location, age, and breed all play a major part. Also, as discussed above, type of plan, deductible choice, reimbursement percentage choice, and benefit limit choice are also important.