Why Pet Insurance is Not a Scam – And How to Avoid Common Pitfalls
Some people say pet insurance is a scam. However, more often than not, these people enrolled in a policy without first understanding how it works. The reality is that the right policy can be a financial lifesaver if your pet experiences an accident or illness.
Key Takeaways:
- Pet insurance isn’t a scam, but if you choose the wrong plan for your needs, it can feel like one.
- Pet insurance is a regulated industry, so claim denials and frustrations typically stem from misunderstandings about coverage, waiting periods, and exclusions, not from unfair practices.
- To prevent frustration and disappointment, do your research before enrolling and take the time to choose the plan that’s best for your situation.
- Pawlicy Advisor eliminates the guesswork. By analyzing hundreds of policies and highlighting personalized recommendations, Pawlicy Advisor helps you find the best coverage for your pet and budget.
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Veterinary care costs are rising, and your pet’s bills can escalate quickly, especially if they need emergency or ongoing care. The key to reaping the benefits of pet insurance is knowing how it works and choosing the right plan for your four-legged family member. Let’s dive in.
Why Do People Think Pet Insurance Is a Scam?
Many people are concerned about covering their pet’s veterinary bills. Still, they may be reluctant to invest in pet insurance because of frustration with issues such as confusing fine print, claim denials, and unexpected costs:
- Exclusions and fine print — Some people are confused by waiting periods and exclusions. Most pet insurance policies have waiting periods before coverage starts, and some have extended waiting periods for certain conditions, such as orthopedic issues. Certain conditions may be excluded entirely, depending on the policy’s terms.
- Claim denials — Pet insurance doesn’t cover pre-existing conditions. This can include chronic illnesses, future conditions related to past illnesses or injuries, and undiagnosed symptoms that were present before the policy took effect.
- Reimbursement percentages and deductibles — Pet owners typically pay upfront and are reimbursed once their claim is approved and their deductible is met.
The real problem
Pet owners often don’t fully understand key concepts such as deductibles, reimbursement, and pre-existing conditions—and many don’t understand their pet’s breed-specific health risks, leading them to purchase the wrong coverage for their needs.
Example scenario: John purchases a pet insurance policy for his Labrador retriever, Jake. The policy has a two-week waiting period for injuries and illnesses. When this time frame passes, John assumes Jake is fully covered. Two months later, Jake injures his knee during a rousing game of fetch. John is surprised to find that his pet insurance policy won’t cover the veterinary bill because it has a 180-day waiting period for orthopedic issues.
Problem: John didn’t select the right policy for his unique needs and breed-specific risks.
Solution: John should have shopped for pet insurance with Pawlicy Advisor – an unbiased, comparison tool offering free, personalized advice from licensed experts.
It’s easy to get overwhelmed by the many pet insurance companies, and comparing coverage needs vs. pricing offers vs. policy options across multiple plans can take hours (or days). This is why Pawlicy Advisor does the work for you.
Addressing Pet Insurance’s Biggest Myths Head-On
Common pet insurance myths can make pet owners hesitate to enroll their four-legged friend. We debunk the most common misconceptions regarding pet insurance.
Myth #1: Pet insurance is too expensive
The median monthly cost of pet insurance premiums is $37.18 to $72.99/month for dogs and $23.84 to $49.76/month for cats, depending on your pet and coverage choices.5 Pet insurance isn’t one-size-fits-all. You can reduce your premium costs to fit your budget by choosing a higher deductible, selecting a lower reimbursement rate, and/or adjusting your coverage limit.
Without insurance, there is no limit to how much you could owe if your pet has an emergency. Emergency veterinary visits can cost as much as $5,000 or more.6 Insurance allows you to reduce your maximum costs, preventing massive unexpected swings in expenses.
A note on responsible pet ownership: Unexpected veterinary bills are an unfortunate reality of pet ownership. If pet insurance doesn’t fit into your budget, you might consider whether you’re financially prepared to handle the cost of a pet, because accidents and illnesses happen more than you think.
Myth #2: Pet insurance companies deny claims
Many pet owners believe pet insurance companies typically deny claims, making it not worthwhile to invest in coverage. However, pet insurance providers must follow strict regulations and process claims based on clear term policies. Claim denials typically stem from misunderstandings about coverage, not from insurers avoiding payouts. Consider the following:
- Pre-existing conditions — Pet insurance doesn’t cover pre-existing conditions, which means illnesses and injuries that occur before enrollment aren’t eligible for coverage. To avoid surprises, enroll your pet when they are young, before health problems occur.
- Policy details — Every pet insurance policy has different coverage limits, exclusions, and waiting periods. Understanding these details before enrolling your pet ensures you know what is and isn’t covered.
- Pet insurance regulations — Pet insurance companies must adhere to consumer protection laws and follow the outlined policy terms. Claims are typically denied because the policy doesn’t cover the specific condition or situation, not because the insurer is being unfair.
Good pet insurance companies, like those on Pawlicy's marketplace, are happy to pay eligible claims. It means happier customers (and pets) and ensures people keep their policy for for the entirety of their pet's lifetime.
Myth #3: A savings account is a better idea
Some pet parents would rather set aside money for their pet’s emergency care as opposed to investing in pet insurance. While having an emergency fund is definitely a good idea, relying solely on savings can leave you financially vulnerable when you are faced with unexpected veterinary bills.
Veterinary emergency expenses can be extremely expensive, especially if your pet needs life-saving surgery or specialized care, which can quickly wipe out your savings.
Consider the following:
- What if your pet needs thousands of dollars in care before you’ve saved enough?
- What if the bill is more than you set aside?
- What happens if you use your savings on one incident, and then there’s another before you’ve saved enough to cover subsequent expenses?
Even the most disciplined saver may not be able to save enough to cover the cost of expensive treatments, such as cancer treatment or multiple surgeries.
If your pet develops a chronic condition that requires ongoing care, costs can quickly pile up. An emergency fund may cover the initial treatment, but your savings may not cover follow-up visits, expensive medications, or a second or third accident or illness.
The Truth About Pet Insurance
Pet insurance is not a scam, but if you choose the wrong plan for your needs, it can feel like one. Since pet insurance is a regulated industry, claim denials and frustrations typically stem from misunderstandings about coverage, waiting periods, and exclusions, not from unfair practices. To prevent frustration and disappointment, do your research before enrolling and take the time to choose the plan that’s best for your situation.
The good news?
Pawlicy Advisor eliminates the guesswork. By analyzing hundreds of policies and highlighting personalized recommendations, Pawlicy Advisor helps you find the best coverage for your pet and budget.
Don’t wait until your pet needs care. Compare top pet insurance plans with Pawlicy Advisor today.
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How Pet Insurance Works
Pet insurance protects your wallet from unexpected veterinary bills, but how does having a policy work?
- Customize your policy — Choose a deductible, reimbursement rate, and coverage limit that fits your budget and coverage needs.
- Know what’s covered — Pet insurance only covers new injuries and illnesses after the waiting period has passed.
- Know what’s not covered — No pet insurance covers pre-existing medical conditions, but some plans cover curable conditions if your pet shows no signs for a set period. Know that a pre-existing condition doesn’t make your pet ineligible—they can still receive coverage for new health issues.
- Pay for veterinary care — Most pet insurance companies require pet owners to pay their vet and submit a claim for reimbursement. However, a few companies provide the option for vet-direct pay.
- Submit a claim — Submit a claim, including your pet’s invoice, to request reimbursement for covered expenses.
- Get reimbursed
Your reimbursement depends on:
- Your remaining deductible: The amount you need to pay before coverage starts.
- Your reimbursement rate: Policies typically reimburse 70%, 80%, 90%, or 100% of covered costs.
- Your coverage limit: The maximum amount your policy will pay per year or per condition.
If all of this is starting to sound complex, Pawlicy Advisor’s licensed insurance experts are on standby, ready to help you understand how pet insurance works and which plans would be a great fit for your pet.
Veterinarians recommend pet insurance because it can really help you
According to a survey conducted by Pawlicy Advisor, in collaboration with the American Animal Hospital Association (AAHA), 92% of veterinary professionals agree that pet insurance helps clients provide their pets with the best possible care. The survey also found that 89% of veterinary professionals believe pet insurance helps reduce the stress and anxiety that pet owners feel related to veterinary care expenses.1
“Pet insurance gives pet owners the financial flexibility to make healthcare decisions based on what’s best for their pet, rather than what they can afford at the moment,” said Dr. Ricky. “It allows veterinarians to provide optimal care without the cost being the deciding factor in treatment.”
“Pet insurance removes financial barriers to care, allowing pet owners to say yes to necessary treatments without hesitation,” said Dr. Angela Beal, a veterinarian in Columbus, Ohio. “It leads to better outcomes, healthier pets, and happier pet owners.”
The most common pet insurance claims for dogs include skin conditions, gastrointestinal (GI) problems such as diarrhea, and ear infections. Top claims for cats include GI problems, urinary tract conditions, and kidney failure.2 Treatment for these conditions isn’t cheap—here are the average costs:2
- Skin condition: $240
- GI upset: $614 (dogs); $747 (cats)
- Ear infection: $280
- Urinary tract disease: $904
- Kidney failure: $694
What pet owners are saying
“I recently submitted two claims for my sick cat totaling close to $1,000, and the claims were processed and paid within a week. Couldn’t be happier.” –Dianne A., about ASPCA Pet Health Insurance on Reddit.
“I’ve had Pets Best for the past seven years, and I’ve never had any issues. My dog was diagnosed with heart disease last December, and they have paid for her cardio exams, tests, and medicine without fail.” –blahduckingblah, about Pets Best on Reddit.
“Just got my policy. In just five months, it’s already paid for itself many times over after a six-day emergency vet stay.” –KatAtWork, about Lemonade on Reddit.
Recommended Reading: Is Pet Insurance Worth It? Here’s a Vet’s Perspective
How to Choose the Right Pet Insurance (and Avoid Pitfalls)
Finding the right pet insurance plan can be overwhelming, but focusing on key factors will help you find the best coverage for you and your pet. Considerations include:
- Breed-specific health risks — Certain breeds are predisposed to genetic or hereditary conditions, which may affect coverage options and costs. For example, Labrador Retrievers are prone to hip dysplasia3 and Maine Coon cats are predisposed to heart disease4. Make sure you find a policy that covers hereditary and congenital conditions.
- Coverage details — Not all plans offer the same coverage. Read the policy details to determine whether the plan covers accidents and illnesses, or accidents only, what conditions are excluded, and if you’re able to add wellness coverage.
- Waiting periods — Most policies don’t start immediately. Read the fine print carefully to determine when your pet’s coverage will start and if there are extended waiting periods for certain conditions, such as hip dysplasia or knee injuries.
- Reimbursement models — Pet insurance reimbursement is often based on a percentage of your veterinary bill or a set amount per condition. With the percentage model, you choose the reimbursement rate, typically 70%, 80%, 90%, or 100% and the insurance company covers that percentage of eligible expenses. (A higher reimbursement rate correlates to a lower out-of-pocket expense, but monthly premiums may be higher.)
- Comparing prices — Pet insurance premiums vary based on your pet’s breed, age, location, and coverage level. Gather quotes from multiple insurers to compare costs and benefits.
Recommended Reading: How to Compare Pet Insurance Plans.
How Pawlicy Advisor helps you find the right plan
Shopping for the right pet insurance plan can be confusing, but Pawlicy Advisor makes the process simple, transparent, and personalized. The platform analyzes numerous policies and helps pet parents compare top insurers to make an informed decision.
Here’s how it works:
- Fill out a short form to compare personalized quotes from top pet insurance companies all in one place.
- Customize your coverage while Pawlicy Advisor’s smart algorithm highlights key recommendations tailored to you and your pet.
- Enroll directly on Pawlicy.com. They’ll handle the paperwork and your policy will be active immediately.
The best part? Pawlicy Advisor’s unbiased licensed insurance agents are on standby to help you find the best plan and answer any questions.
Join 1 million+ pet owners who got matched to the right pet insurance through Pawlicy Advisor.
References:
- Pawlicy Advisor. (2023). Shifting Perceptions: The Growing Impact of Pet Insurance on Veterinary Practices in 2023. Retrieved from: https://www.pawlicy.com/pet-insurance-impact-on-veterinary-practices-report/
- Yankowicz, S. (2024). Pet insurance company reports most common veterinary visits. Dvm360. Retrieved from: https://www.dvm360.com/view/pet-insurance-company-reports-most-common-veterinary-visits
- Cornell University College of Veterinary Medicine. Canine hip dysplasia. Riney Canine Health Center. Retrieved from: https://www.vet.cornell.edu/departments-centers-and-institutes/riney-canine-health-center/canine-health-information/canine-hip-dysplasia-chd?utm_source=chatgpt.com
- Universities Federation for Animal Welfare. Maine Coon hypertrophic cardiomyopathy. Retrieved from: https://www.ufaw.org.uk/cats/maine-coon-hypertrophic-cardiomyopathy?utm_source=chatgpt.com
- Pawlicy Advisor. (2025). How Much Pet Insurance Costs in 2025: Compare Quotes by Breed and State. Retrieved from: https://www.pawlicy.com/blog/pet-insurance-cost/
- Barrow, L. (2024). What to know about cost of emergency veterinary care. WebMD. Retrieved from: https://www.webmd.com/pets/what-to-know-costs-emergency-veterinary-care
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Dr. Angela Beal has worked in private practice and taught veterinary technicians for 15 years. Angela is a veterinarian who loves using her writing to help pet owners provide the best possible care for their furry companions. Since 2020, she has worked full-time within the veterinary education writing and editing industry. Angela lives in Columbus, Ohio with her husband, two sons, and their spoiled Chihuahua mix, Yogi.
