How does dog insurance work?

By Allstate

Last updated: October 2021

Pet Insurance may help you better manage veterinary expenses if your dog gets sick or injured. Just as with "people" health insurance, pet insurance for dogs comes with different plans, policy features and price factors to consider. Some providers may offer a discount for enrolling more than one dog in a policy.

Here are some things to keep in mind about how dog insurance works.

Get a free pet insurance quote today.

Protect your furriest family member. Give your dog or cat the love and protection they deserve with pet health insurance.

By clicking "Get a Quote" you will leave and be directed to the Embrace website*

Types of pet insurance coverage

Plans are available to cover a wide spectrum of pet health-care needs, such as:

Coverage for accidents and illnesses:

This type of policy covers worst-case scenarios, such as poisoning, dental trauma and illnesses, including cancer. The Insurance Information Institute (III) advises consumers to check if a policy covers breed-specific conditions, such as hip dysplasia common in bulldogs and other large breeds. Some policies exclude dogs with pre-existing conditions, according to the III.

Wellness coverage:

This type of plan addresses the "basics" behind most routine vet office visits: vaccinations, dental work and tests, according to the North American Pet Health Insurance Association (NAPHIA). Some well-care plans may have no or low deductibles for these preventive services and routine care.

Prescription coverage:

These plans may help cover out-of-pocket prescription expenses for your dog. For example:

  • A round of antibiotics
  • Medication for a chronic condition like asthma
  • Medication to treat a serious illness, such as cancer

Comprehensive coverage:

A comprehensive plan will likely include the above coverages, plus extra services. For example, some insurers may cover alternative therapies (acupuncture, chiropractor, etc.), prosthetic limbs, visits to a veterinary emergency hospital and consultations with specialists.

Dog insurance policy features

Several features of dog insurance will sound similar to "human" health insurance policies. For instance, pet insurance policies typically include:

  • Premiums, or the amount you pay for coverage
  • Deductibles, your out-of-pocket expense toward a covered claim before insurance benefits are applied
  • Coverage limits, the maximum amount your policy will pay toward a covered claim
  • Waiting period, meaning coverage does not begin for your pet until a specified period of time after you buy a policy

But, there also are a couple of key differences to keep in mind:

Pet insurance policies typically pay claims on a reimbursement basis.
Pet owners usually pay a veterinarian's bill at the time of service and then file for insurance reimbursement afterward, according to the American Veterinary Medical Association. Reimbursement for covered treatments will kick in after you've met your deductible.

Pet insurance companies reimburse for claims in different ways.
According to the National Association of Insurance Commissioners(NAIC), reimbursement amounts may be based on:

  • Amount spent by the policyholder: The insurer pays a set percentage of the total bill
  • Schedule of benefits: The insurer pays a set price for a given treatment
  • Schedule of usual, customary and reasonable charges: Bases reimbursement on the average cost for common services in the policyholder's area

Read the fine print to figure out which reimbursement method your pet insurance policy follows.

Dog insurance cost factors

Insurers evaluate a number of factors to price their policies. According to the NAIC, pet insurers will look at:

  • Your dog's age
  • Your dog's breed
  • Where you live
  • The coverages you select
  • The deductible you choose

You can typically adjust the deductibles, coverage limits and reimbursement percentages on your policy. That way, you can reach a policy premium to fit your budget and make you comfortable about the coverage your policy provides for your four-legged family member.

By understanding the insurance options for your dog, you can find the pet insurance plan that works best for your entire family.