Is the Pet Insurance Industry Regulated?

What every dog owner needs to know about pet insurance

When it comes to the safety of our pets, loving owners are prepared to do just about anything to protect them. We provide the best diet, a comfortable place to sleep, healthy hygiene, and plenty of attention to keep their minds fresh and young.

While all these topics are clearly precautions to prevent dangerous situations, there is always the concern of “what if?” What can happen? Because we live in a world of infinite variables, everything is possible to some degree. And as a result, accidents and the unexpected do happen, which is why we have insurance.

But, there is something unique about pet insurance and while we pet owners clearly understand that our dog is a living, breathing creature, they are still treated as objects and statistical numbers by entities and government departments.

Needless to say, many insurance companies will also see your pet the same way. So consider what you should be aware of when considering insurance for you dog, because there are large differences and a few topics that need to be addressed before you make an investment in any form of coverage.

Government oversight

Consider the fact that insurance companies can be divided into two very distinct groups based on what they can and can’t do.

Admitted insurance companies and organizations are the baseline providers and have been accepted by the State Insurance Department because they offer particular coverage and specific qualifications. This means that the insurance companies provide services according strictly to the government’s requirements, often limiting their abilities and opportunities they can offer. Though, in case of their inability to cover a claim, the state will step in and insure your coverage.

Non-admitted are supposed to offer specialty insurances that state regulated or admitted insurance companies cannot approve or provide. These situations may be rated as “high-risk.” In some cases, they may not have been approved by the state’s insurance department oversights, and therefore don’t fit the criteria dubbed necessary to provide approved insurance services.

The only problem with this type of insurance is that because there is no government oversight, if the insurance company falls out or is unable to cover claims, there is basically no guarantee that a pet owner will ever be able to collect on their insurance claims.

What to be concerned about

Keep in mind that you will have to adhere to insurance policies, which often require that you use certain products, veterinarians and hospitals, certain drugs, and adhere to their specific protocols. In addition, you’ll likely have to maintain documentation about what you do and where it takes place.

If you don’t follow policies, rules, and regulations, you may be forfeiting your dog’s insurance policy and not even know it until you have to make a claim.

Basically, you may have to use pet insurance approved products, which can cost more or be inconvenient or even against your personal choices for your dog (such as choosing natural products instead of modern chemical based products).

There is also the concern of what a particular insurance actually covers for your pet. Medical expenses, accidents, and theft are just some of the popular coverage topics, but they aren’t always included. You need to be sure to ask your insurance broker what exactly is covered on your pet.

While you can attain different types of insurance on your pet, the option of pet-medical insurance is often not carried or provided because of the low commission fee that many insurance brokers are accustomed to. This makes it financially inconvenient for most brokers to carry certain types of pet insurance, which is exactly why you need to inquire as to exactly what your insurance would cover and if it is actually worth the cost.

Regulated vs. unregulated

In cases of insurance where there is no government oversight, plans may be largely more flexible, and are most often used for “show” dogs and large claims that state regulated insurance companies can’t legally provide. This is also beneficial for those dogs with pre-existing conditions in which case government controlled insurance providers would and could not feasibly provide coverage.

The positive side to regulated insurance companies is that they are often less costly and have standardized prices, mostly because they are backed by the state and the pricing is then controlled. This is also because clients are often at far less risk, since dogs with pre-existing conditions are not commonly accepted.

Pet insurance isn’t there necessarily because something will happen, but rather it is there so nothing will happen that you aren’t prepared for. If you’re interested in pet insurance, don’t consider it as something you can easily pick up at your insurance broker. Ask around and make sure that your dog is really getting what you’re paying for.

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3 thoughts on “Is the Pet Insurance Industry Regulated?”

  1. There are currently 12 companies offering pet insurance in the U.S. and they’re all admitted and regulated under the property and casualty umbrella. P&C is the same as auto, homeowners, liability, etc. They are highly regulated and must file in all 50 states. Pet owners need to be careful to understand what’s covered and what’s not, but if it’s covered they will pay just like your auto insurance company will.

    Learn more here… http://www.petinsurancequotes.com/compare/index.html

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