Many pet owners may believe that pet insurance is true medical insurance. But it's actually a form of property insurance that reimburses owners for their pet's veterinary costs. Pet insurance policies usually cover 80% of costs for eligible expenses after the deductible.
Owners realize that they can take their pet for treatment, pay the bill and submit a claim for reimbursement. Then the insurance company reimburses the policyholder (as outlined in the policy) for treatment of their pet's illnesses and injuries.
Pet Insurance Regulation
Each state's department of insurance is responsible for regulating pet health insurance while human medical insurance is subject to federal regulations. Pet insurance regulation is simpler than medical insurance.
All pet insurance policy forms, rates and rules are subject to extensive review before being approved by the states in which they are available.
Insurance Company Pays a Portion
One of the benefits of pet insurance is that the insurance company pays a portion of the costs incurred.
Many pet health insurance plans are a form of fee-for-service indemnity insurance that allows the pet owner to:
- Use any licensed veteri
- an.
- Pay at the time of serv
- for their pet's medical treatment.
- File a claim for reimbu
- ent.
Pet Owner Chooses Veterinarian
Since most pet insurance plans aren't managed care plans, owners don't have to worry about using network veterinarians. They are free to choose the veterinarian that they feel most comfortable with. This allows the owner to have a certain level of control over their pet's treatment.
Most plans don't use a benefits schedule. This allows owners to choose the type of treatment that is most affordable and beneficial for their pet.
Pet Insurance Reimbursement
The veterinarian is removed from the claims process. They can treat the pet and receive payment immediately from the owner. The veterinarian doesn't have to submit a claim to the insurance company.
The indemnity policy ensures the relationship is between the pet owner and the insurance company. It's not between the veterinarian and insurance company. The veterinarian's responsibility with a pet insurance policy is to treat the pet, sign the necessary paperwork and provide an itemized statement, so the owner can be reimbursed. Although the veterinarian isn't responsible for submitting claims, some do as a courtesy to their clients.
Pet Insurance Companies
Unlike human medical insurance that is offered by numerous insurance companies, pet insurance is underwritten by only a few insurance companies in the United States.
Some of the largest pet insurance companies in the United States include:
- nderwritten by Veterinary Pet Insurance Company (in California) and National Casualty Company (for all other states).
- Property Insurance Agents
Pet owners purchase property insurance for their car and home. But many overlook insurance for another important "property" - their pet.
Since many pet owners view their pet as a member of the family rather than property, insurance agents should use caution in approaching owners about pet insurance.
Some agents have learned that offering pet insurance as a value-added cross-sell with life and health insurance for people may be a better approach than focusing on the insurance industry classification of this coverage.
Copyright Noileen Richardson. Contact the author to obtain permission for republication.
Noileen Richardson - Noileen Richardson is an insurance specialist who began her insurance career almost two decades ago as a property and casualty licensed ...
