How Does Pet Insurance Work?

Pet InsurancePet insurance aids you in paying the cost of you medical expenses if your pet falls ill or has an accident. Many pet insurance plans offer Routine and Wellness coverage for various circumstances ranging from reimbursement for vaccinations and healthy annual exams to spaying/neutering etc

Pet insurance is best used to help mitigate or soften the economic blow of unexpected, high veterinary bills. With any insurance (property, auto, etc), chances are that you will receive less from the insurance than you paid because your pet stayed healthy and did not have any accidents.

There is also a chance, because your pet is prone to injury, that you will receive more than you put in. Either scenario is possible. Pet insurance is accessible to soften the blow financially if something were to happen to your pet and should not be used with the expectation of saving money.

We will be talking more about how pet insurance works in this article.

How Does Pet Insurance Work?

To make it easier for you to figure out how Pet insurance works we will be comparing it to Human Health Insurance.

Similarities:

Like Human Health Insurance, Pet Insurance has deductibles, premiums, co-pay, and maximum payouts.

Premium:

Amount paid monthly or annually for your pet insurance policy.

Deductible:

Amount of the veterinary bill you must pay before the insurance company beings paying.

Types of deductibles:

Per-Incident – Amount you must pay for each new injury or illness. This deductible is paid only once for each new injury or illness. If an incident occurs that specific incident has one deductible regardless of how many times you must return to the veterinarian for a checkup.

  • Annual – Amount you must pay each year regardless of the number of new incidents.
  • Choosing a lower deductible will increase your premium but lower the amount of money you will pay out of your pocket for medical treatment.
  • Choosing a higher deductible will increase the amount of money you will pay out of your pocket for medical treatment, but lower your premium.

Co-pay:

The percentage of covered expenses that must paid by you, after the deductible is met.

The remaining percentage of covered expenses is paid by your insurances company.

  •  Remember that that not all plans cover every injury or illness and or treatment and procedure. Please make sure you are aware of what your specific plan covers.

Choosing a lower co-pay will increase your premium but lower the amount of money you will pay out of your pocket for medical treatment.

Choosing a higher co-pay will lower your premium but increase the amount of money you will pay out of your pocket for medical treatment.

Maximum Payout:

The maximum amount of money the insurance company will give you.

There are five different types of Maximum Payouts:

  •  Maximum Payout Per Incident – The maximum amount of money the insurance company will reimburse you for each new accident, illness or injury. Once its limit is reached, that particular accident, injury or illness will no longer be covered and you will not receive any more money for that particular accident, injury or illness.
  • Maximum Payout Per Year – Also refered to as the Maximum Annual Payout. This is the maximum amount of money the insurance company will reimburse you each policy year. Once you’ve hit this limit, you will no longer receive money for any accident, injury or illness for that policy year.
  • Maximum Lifetime Payout – Is the maximum amount of money the insurance company will reimburse you during the lifetime of your pet. After reaching its limit, you will not receive any more money and your policy will be terminated.
  • Maximum Payout Per Body System – Is the maximum amount of money the insurance company will reimburse for a body system. Examples of body systems include: Digestive system, musculoskeletal system, and nervous system. Once you hit this limit for a body system, you will not receive any more money for any injury or illness that relates to that body system.
  • Maximum Payout Based on a Predetermined Benefit Schedule – Is the maximum amount of money the insurance company will reimburse based on predetermined listed fee structure.You will be notified ahead of time the specific amounts they will pay for certain diseases.

Depending on the company, a combination of two types of maximum payouts can be used. Some companies institute a maximum payout per year and others a maximum payout per incident.

You will pay more in premiums the higher the amount of your maximum payout.

To find out more about pet insurance, please check out the site animal insurance review.

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