How to Choose the Best Pet Insurance (in 6 Steps)

Buying pet insurance can be incredibly confusing.

These 6 steps will walk you through what you need to consider when deciding how to choose the best pet insurance for your dog or cat.

Avoid the common pitfalls, and be confident in the knowledge that your pet’s healthcare is covered to the best of your ability!

how to choose the best pet insurance with a picture of dollar bills and a dog and cat

I'm from Knoxville Tennessee. Which pet insurance is good for a cat or dog?

Pam writes to ask all about how to choose the best pet insurance policy

How to Choose the Best Pet Insurance

Pay close attention to:

  1. The excess

  2. Any co-payments

  3. Surgical and medical cover

  4. Total amount covered

  5. Is cover per condition or per year

  6. Exclusions or pay-out limitations

It’s vital to never choose an insurance policy based on premium price alone!


I'll start off by saying that pet insurance policies are really not all equal. They do vary in a number of different ways that may not be obvious at first glance. This may also differ by country as well, and there may be different options depending on where in the world you live.

One of the biggest differences in policies is excess. This is the amount that you need to pay, or the amount that the bill needs to be cleared, before the insurance company will consider accepting a claim and making payment for that treatment.

The higher the excess, the lower the premium. This is because more minor or “every-day” consultations and illnesses won’t end up costing more than the excess and so the insurance company will not need to make any form of payment.


Co-payments are another thing that varies. A co-payment is a certain percentage of the bill that you may have to pay. It might be that, for example, there's an excess of $100 and a 20% co-payment. This would mean that for any bill that you submit, you would have to pay the first $100 dollars of treatment and then for anything else you'd have to pay 20% of the total bill.

If your pet’s vet bill was a total of $1000, you would end up needing to pay $300.

Some insurance policies will not require a co-payment when your pet is young, but as they get older will then add a co-payment. The flip side is that those which don’t add on a co-payment may not provide insurance cover for older dogs or cats.

Surgical and medical cover

What is covered by the insurance policy? Are all surgical procedures covered? Is it only medical cover that you're buying or vice-versa?

You can get just surgical-only, or accident-only policies, which is great if your dog or your cat breaks a leg. Emergency treatment or complex surgery can add up incredibly quickly! The policy is worthless though if your cat develops diabetes, dog suffers from arthritis, or your pet develops a complicated medical condition where their treatment is not going to be covered.

Value of cover

The total amount covered is clearly another thing that's going to change by policy. Are they only covering you up to a $1000 dollars, for example, which would be an insurance policy not really worth having for the majority of people.

Is it instead $5,000, $10,000, $15,000? The higher the potential payout, the higher the premium. Talk to your vet about potential costs should the worst happen so you can make a judgement about what level of cover is best for you and your pet.

Is Insurance cover per condition or per year?

And then is that amount covered per condition? So is it that amount in total if they break a leg and then if they get another problem later on the year is that also covered up to that total amount covered? Or is it per year? So do you have $10,000 in your pet's treatment pot, for example and if you use $8,000 on fixing a broken leg there's only $2,000 left if something else comes along.

Also, is there a limit that can be paid out for any single condition before that problem is completely excluded from all future claims? An example here would be cruciate ligament rupture. Any surgery or ongoing treatment would only be covered up to the total amount, and any arthritis that developed in that joint in later life would then be excluded.

Other policies will simply reset at the start of the next year, with no exclusion applied. This is just another reason to be clear on with what's being covered when it comes to choosing the best pet insurance policy for you and your family.


And then exclusions are the final consideration.

If you’re getting pet insurance when your pet is young (and ideally we should be), there's not going to be any exclusions based on their previous conditions. You can’t get insurance to cover an illness or injury once the problem has already started!

There could though be exclusions based on your pet’s breed. Another possibility is that a low dollar limits is placed on certain common illnesses or diseases that your dog might get because of their breed.

For example, some policies I've seen have a really low amount that they'll cover for cruciate ligament rupture. The result is that the amount that's covered doesn't actually cover the cost of any surgical treatment! This is a problem that is very easy to miss, and only become aware of when a claim is made. Not only could this make things challenging for you financially, it would also be very upsetting after thinking you had your pet’s health well covered.

Weighing up Pet Insurance Options

What then is the best pet insurance for you and your dog or cat? Clearly here are lots of factors to consider when your looking at insurance policies. The best policy is very much going to depend on your financial situation, the level of risk you are prepared to take, as well as specific details about your pet and their history.

It's vitally important that you’re very clear about what's covered, about how much a policy is going to cost you, and how the policy will change as your pet ages. You really need to weigh up all of these factors when comparing which pet insurance policy is best for you.

Never decide based on a monthly cost alone. Low cost options may be right for you, but are highly unlikely to provide the best cover possible should your pet become unwell or have an accident. There may still be very severe limits on what treatment options are able to be provided for them, and that's clearly not something you want to happen if you're insuring your pet in the first place.

Talk to your vet

Also talk to your vet. It may be that legally they're not allowed to give you specific advice because they're not registered financial advisors, but they should at the very least be able to give you some cost estimates of the more common (and less common) claims that you may need to make in your pets lifetime.

Direct claims

Another question to ask is if there any companies that they're happy to accept direct claims from?

Some companies are really poor at approving claims. Some take a ridiculously long time to pay out a claim. It might be that you submit a claim and you only get that money back 6 months later! Some clients have also been known to ring up after a claim has been submitted, and ask the insurance company to pay them rather than the vet as was previously agreed. They are then never seen again and the vet goes unpaid.

All these issues mean that in many cases, unfortunately, direct claims are not accepted by a large proportion of veterinary clinics. As a result, you will need to pay for the cost of your pets treatment at the time they need their treatment, and then be responsible for claiming the costs back yourself.

In a lot of cases, it's just too risky for the veterinarian to accept a direct claim because it may not be approved, payment may not be made, payment may take an awful long time and unfortunately some people may try and get the money directly after having said that they are happy for their vet to be paid directly.

For a noon-emergency condition, it may though be possible to get a claim pre-approved, which could make a direct claim more of a reality.

So talking to your vet and seeing if there's any companies that they're happy to accept direct claims from is also something to consider.

Pet Insurance Alternatives

Finally, let's talk briefly about alternatives to insurance. Insurance is a fantastic way of making sure that you've got the means to pay for your pet’s treatment. It’s not the only option open to you though, and as you are still likely to need to pay everything up front, then certain treatments may still not be open to you despite having insurance cover.

Having pet insurance may still involve credit cards or other forms of loan just to cover the bill initially, before then getting it refunded, potentially months later.

Pet savings account

Another option instead is to keep a savings account for your pet. Every month, every fortnight, whatever it is, making a payment into that account so that should something happen you've got some money in the pot.

The problem with this approach is that if something happens in the first few years of your pet's life, when there's not very much in the account, you may not be able to cover very much treatment at all. If your pet broke their leg for example, any surgery could be completely unaffordable.

Credit cards and loans

You could also consider using credit cards or other forms of loans if you're in a position to be able to access credit. Access is one thing, being able to realistically afford the loan is another as these forms of credit typically attract a very high interest rate.

I’m not a financial adviser (obviously), but whenever we're taking on debt, we really need to be aware of how much that's costing us long-term and how that's going to affect our lifestyle long-term. If taking on a loan to treat your pet is going to compromise your ability to pay rent or feed your family then it is probably not something you should ever consider.

While that's not a pet specific problem, it's definitely something we should be thinking about when it comes to planning how we're going to look after our pets, should they become unwell or injured.

The above is a transcript taken from “The Dr Alex Answers Show”.

If you would like me to answer any question you have about your pet’s health, simply fill in this form and I’ll try and get you the information that you need. It’s that simple!