Pet Insurance Policy Types
Unlike other insurance products, such as car insurance, pet insurance policies can vary greatly in the amount of cover they provide. It's important to decide what type of cover you need before you take out a policy, as making the wrong choice could mean paying more than you need to for cover you don't require, or buying a cheap policy which doesn't provide cover when you really need it.
Most pet insurance policies fit into one of three types - typically known as Time-Limited (or Annual), Maximum Benefit and Lifetime. Some companies also offer an Accident Only policy; these are cheaper than the other types, but you’re much more likely to require cover for an illness than an accident so these aren't really as useful as the other more comprehensive policies.
Accident-Only policies only provide cover for treatment needed in the event of an accident, and will not cover vet fees for illness. As a pet is more likely to require treatment for an illness, these policies are not as useful as the more comprehensive policies available.
Time-Limited policies will provide cover up to the specified amount for a maximum period of 1 year from the time the accident happens, or the illness starts. The amount can be either per condition or a total for the year, but if treatment needs to continue for more than a year, then it won’t be covered once that initial 12 month period is up, and will also be excluded from future policies as a "pre-existing condition". If treatment starts part-way through a policy year, the treatment will continue into the next period of insurance (up to 12 months from the date the incident occured or illness started) as long as you renew the policy.
The next step up in pet insurance policy are Maximum Benefit policies, which will provide cover for a set amount for each condition, for as long as the policy is in place.
It is important to note that even though some of these policies refer to cover as "Lifelong" or "Lifetime", this isn't the same as a genuine Lifetime policy as once you've claimed up to the limit for a particular condition, you won't be able to make any more claims for that same condition even if you continue to renew the policy.
For example, if your policy covers £4000 per condition, and your pet suffers a broken leg which costs £2000 to fix, and then later becomes ill which results in another £3000 of vet bills, then both will be covered. If your pet then damages his leg again a couple of years later, the payout will be restricted to the balance of £2000 for that condition, and once that maximum is reached, the insurance company will no longer pay out for that condition. Usually at this point, the condition will be excluded from any future policy even if you renew with the same company.
Lifetime policies are the most comprehensive, and typically the most expensive type of pet insurance policy. These policies provide cover for treatment of ongoing conditions such as arthritis or eczema which can require treatment from a vet over a long period of time, often for life. As long as your policy is renewed each year without a break, cover for these conditions will continue to be provided, up to the yearly limit (per condition, or overall yearly total depending on the policy).
The amounts covered are generally higher than the other types of policy, but they have to cover all cover all conditions that may occur during the year. Using the example given above, if you had a Lifetime policy with a cover of £12000 per year and claimed £2000 for a broken leg and £3000 for the illness, that would leave £7000 for any further treatment required during that year. After 12 months, then the cover amount resets back to £12000, and also none of the conditions claimed for previously will be excluded (unless you change insurance company), so you would be able to claim for the same illness again.
The vast majority of pet insurance policies fit into one of the four catagories above, however there are a small number that don't. Such examples are policies that have more than one limit per claim - for example, a total limit for the year, plus a limit on each condition.