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Understanding the Fine Print in Pet Insurance Policies

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Pet insurance is making veterinary care more affordable and accessible for many Americans. However, some customers feel that they have been "bitten'' by the fine print.

As a record number of claims are being paid in the burgeoning pet insurance industry, consumers are also issuing complaints. Some of the most common are assertions by policyholders that claims are being denied due to misleading practices by their pet insurance companies.

Not always a good experience

"It was a horrible experience,'' said Vin Menon of his former pet insurance company's claims procedure. "The sales team painted a pretty picture and told me everything I wanted to hear, but dealing with the claims department was a much different story.''

Shortly after purchasing coverage for his four-month-old Great Dane, Sophie, the dog began vomiting frequently, necessitating a trip to the emergency room. Menon then paid roughly $3,000 for two days of testing to determine that Sophie "may'' have gastroenteritis. Although the dog would recover without treatment, Menon's battle to be reimbursed by his pet insurance company was just beginning.

Different from health insurance

Unlike health insurance, which most Americans are familiar with, all pet insurance companies operate on a "reimbursement'' model in which the customer pays 100 percent of costs upfront before submitting the claim. Many policyholders find the forms confusing, although insurers contend that the process is simple. But entering a wrong code, for example, can result in a claim being delayed, or in some cases, denied.

Although Menon completed his paperwork satisfactorily, two months later he would be shocked to that learn that his claim was rejected.

Pre-existing conditions

Because the emergency room listed gastroenteritis as a "possible'' cause for Sophie's illness, Menon's pet insurance company considered it a "pre-existing'' condition, which not all plans cover.

Although Sophie's registration papers mentioned that she had vomited in the past like all puppies do, there was no documentation by any veterinarian that the dog suffered from the condition.

"I thought that they were going to cover 90 percent,'' Menon said. "They made it sound simple on the phone when I bought the plan, but they were looking for a loophole so they wouldn't have to pay.''

Poor customer service

After dealing with his pet insurance company's "apathetic'' claims department and getting many different and confusing explanations, Menon gave up on being reimbursed and cancelled his policy.

"It would take forever to just to get someone on the phone,'' Menon said. "Each time I would have to tell the whole story over again and then I would get a different explanation. It was exhausting.''

Although bitter and jaded by the whole experience, Menon still believes his dog should be insured and after doing extensive research, bought another policy through a different company - yet he remains skeptical.

Overcoming stereotypes

Just like in any industry, pet insurance companies rely greatly on reputation and word of mouth to create and maintain new business. Reputable insurers are constantly challenged to overcome negative stereotypes fostered by some of their competitors.

Straightforward, easy-to-read policies, and honest, informative customer service will no doubt be important factors in changing negative perceptions.

"The biggest challenge we face today is to overcome any negative notions having to do with past pet insurance companies,'' said Darren Defeo, Senior Vice President of Trupanion, a pet insurance company. "The best thing we can do is to be up front and transparent about how our policy works.''

So if you're considering health insurance for your pet, be sure to read the fine print and ensure the policy in question is the best option for both you and your pet.

Credit: Reviewed by Amy I. Attas, V.M.D.  
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