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Updated: Sat, 21 Sep 2013 04:00:00 GMT | By Gordon Powers, MSN Money

Why health insurance for pets makes sense

While many U.S. companies are modifying their employee benefits packages to include pet health insurance, Canadian employers don’t seem to be doing the same.

Gordon Powers, MSN Money

According to the American Animal Hospital Association, close to half of pet owners who regularly take their animals to the vet would spend “any amount” to save their pets’ lives, including going into debt if they had to.    

Health costs can run thousands of dollars over the life of some pets, although the chances are slim that most people will ever need to shell out that much for treatment. But try telling that to anxious pet owners worried about artificial hips, chemotherapy or major surgery for their companion animals.

No wonder estimated spending on veterinary care on this continent is roughly $14 billion, according to the North American Pet Health Insurance Association.

Recognizing that escalating costs are a major concern for many animal lovers, employers south of the border are strengthening their employee benefits packages by offering pet health insurance, one of the fastest growing voluntary benefit segments in the U.S.

According to Veterinary Pet Insurance (VPI), the largest U.S. provider of pet health insurance, one in three Fortune 500 companies offers its workers insurance for their companion animals.

In recent years, more than 3,400 companies and organizations — including Chipotle Mexican Grill, Deloitte, Delta Air Lines, and T-Mobile — have added pet health insurance to their benefits portfolio. 

Chipotle, for instance, pays $10 per pet per month for up to three pets. Therefore, employees end up paying $10 and $57 a month, depending on coverage plans and deductible.

Currently, few Canadian companies offer pet insurance as part of their benefit package, and when they do, it is usually a voluntary benefit much like group home insurance. But this might be changing, industry observers suggest.

“With the job market improving, it makes sense for companies to strengthen their voluntary benefits portfolio to attract top talent,” says Deana Single, director of group accounts for VPI. “Adding pet insurance will incentivize prospective pet lovers and retain current pet-owning employees.”

Those employers that do offer pet insurance typically subsidize a percentage of their employees’ cost, with some companies covering as much as 100 per cent of their workers’ pet insurance premiums.

Plan sponsors often allow members to pay their premiums via payroll deductions, which means pet owners don’t have to take on any additional administrative responsibilities.

Despite this trend, Canadians are still largely on their own when it comes to looking for coverage for their pets — and there’s no shortage of choices.

Earlier this year, for instance, retail giant Walmart began offering pet insurance to its customers in select stores across the country.

There are also several established providers in Canada, most of which are reviewed on, a site that provides consumer reviews of both Canadian and American providers.

As with health insurance for the two-legged, the older your pet, the more the premiums will cost. Premiums and coverage also depend on the breed, species and location of the pet.

Policies and premiums can vary widely, particularly when it comes to deductibles, co-pays and caps, which may limit payouts according to the type of incident, an annual allowable minimum or the animal's lifetime.

Some plans have limits for each incident. Some cover only basic accidents and illnesses, while others cover vaccinations, checkups and routine procedures like spaying and neutering.

Depending on the type of plan you choose, dental costs for your pet, such as annual teeth cleaning or treating infected gums, may also be included.

Premiums range from about $15 a month for modest coverage to something closer to $100, with most plans covering between 50 per cent and 90 per cent of the bills, depending on the illness and the policy.

While these costs can mount up, if you have several pets, including a cat (typically a less expensive animal to insure), your total fees may outweigh any claims you might make.

Talk to your veterinarian about the type of policy that might best suit your needs. Although vets aren’t permitted to recommend particular companies or broker on their behalf, they do have a sense of what might lie ahead and what previous patients have experienced.

As always, shop around for the best price. While plan specifics will vary, many companies offer free quotes online.

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