How Do Pet Insurance Deductibles Work?

Like human health insurance, pet insurance helps cover unexpected medical expenses for our furry friends. One crucial component of that coverage is your pet insurance deductible. Understanding how deductibles work can help you choose the right plan for you and your pet.

What is a pet insurance deductible?

A pet insurance deductible is the amount you pay out of pocket for your pet’s veterinary care before the insurance company starts covering costs. It’s a set amount you choose when you purchase your policy, such as $100, $250 or $500. If you have an annual deductible, you’d have to pay this amount only once per year.

How do pet insurance deductibles work?

A deductible is a way for insurance companies to share the cost of vet bills with pet owners. Once you’ve met your deductible, the pet insurance company will pay any remaining portion of your vet bills that qualify for coverage.

In most cases, you’ll need to pay the full vet bill yourself and then file a claim for reimbursement with your pet insurance company. If there are any expenses insurance doesn’t cover, like taxes or waste disposal, the company will subtract them along with your deductible before reimbursing its share of the bill. The company may also subtract a copayment.

Raising or lowering your deductible will affect how much you pay for pet insurance. Selecting a higher deductible usually lowers your insurance premium but means you'll pay more out of pocket when your pet needs care.

» MORE: What does pet insurance cover?

Types of pet insurance deductibles

There are two main kinds of deductibles: annual and per condition.

Annual pet insurance deductible

An annual pet insurance deductible is a set amount you pay each year before insurance starts covering your vet bills. You pay this deductible only once per policy term. It doesn’t reset until your policy renews, regardless of how many claims you make. This is the most common type of pet insurance deductible.

Say you have a $300 annual deductible, which is applied before any copayments. If your dog Sadie has a minor accident and the vet bill is $150, you pay the entire amount since it's less than the deductible. (Note that you’d still want to file a claim so your pet insurance company can apply the amount you’ve paid toward your deductible.)

Later that year, Sadie gets sick and racks up a $500 bill. You’d pay the remaining $150 of your deductible, and the insurance would cover a portion of the remaining $350, depending on your policy’s terms.

If Sadie has more health issues within the same year, the insurance would continue to help cover the costs since you’ve already met the deductible. But once your policy renews, your deductible will reset and you’ll need to pay it again before receiving more insurance coverage.

» MORE: Does pet insurance cover spaying or neutering?

Per-condition deductible

With a per-condition deductible, you pay a set amount out of pocket for each illness or condition your pet has. This type of deductible may also be called a per-incident deductible.

For example, if your pet gets an ear infection and later breaks a leg, you would pay your deductible twice: once for the ear infection and once for the broken leg.

After you pay the deductible for a specific condition, insurance helps cover additional costs for that condition over the life of your pet. This is beneficial if your pet develops a chronic problem that needs ongoing treatment each year. Once you meet the deductible for that condition, you don't pay it again, whereas you'd pay it each year with an annual deductible.

The downside is that if your pet needs care for an unrelated problem later in the same year, you’re stuck paying the deductible all over again.

» MORE: Is pet insurance worth it?

Deductibles vs. copays and reimbursement rates

Deductibles, copays and reimbursement rates are different parts of how you and your insurance company share costs. Along with your deductible, the insurance company uses the copay and reimbursement rate to calculate how much of your vet bills it will cover.

A copayment, or copay, is your share of the vet visit cost aside from your deductible. The reimbursement rate is the percentage of the bill the insurer will pay. For example, if your policy has a 70% reimbursement rate, that means your copay is 30%.

Some pet insurance companies apply your deductible first, then your copayment. Others do the opposite — which could leave you covering more of your vet bills. Here’s how the math would work on a $1,000 vet bill if you have a $250 deductible and an 80% reimbursement rate, and you haven’t paid anything toward your deductible yet.

In general, a policy with a higher reimbursement rate will be more expensive, but the insurance company will cover more of your vet bills.

» MORE: The best pet insurance for pre-existing conditions

How to choose a pet insurance deductible

The goal when choosing a deductible is to strike a balance between good coverage and manageable out-of-pocket expenses. Here are a few tips.

Determine your budget. First, figure out how much you can comfortably pay for vet care. Imagine if your pet needed to visit an emergency vet tomorrow. How much of a deductible could you afford to pay? You shouldn’t struggle to cover your deductible in an emergency, so choose an amount that fits your budget.

Do the math. Even if you can afford a higher deductible, check whether the savings are worth it. For example, we got a quote for a 5-year-old mixed-breed dog and found that changing the annual deductible from $100 to $500 would reduce our monthly price from about $61 per month to $38 per month. That would save us about $276 per year — but we’d have to pay $400 more of our vet bills before the insurer would start reimbursing us.

Weigh other factors. Remember, the deductible is just one part of your policy. Consider it alongside copays, reimbursement rates and annual coverage limits to get the full picture. The more costs you take on yourself, the less you’ll pay for insurance, and vice versa.

Check previous vet expenses. If you’ve had your pet for a while, looking at what you've spent in vet care over the past year may help you predict future costs.

» MORE: How much does pet insurance cost?

Can you get pet insurance with no deductible?

Very few companies offer it, but pet insurance with no deductible does exist. Trupanion sells plans with a $0 deductible option. MetLife does, too, but its zero-deductible plans are available only by phone, not online.

Many other companies have deductibles as low as $50 or $100, as shown in the table below comparing options from leading pet insurance providers.

» MORE: The best pet insurance companies