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Pet Insurance (Page 3 of 4)

Pet Insurance Peeves: Considerations for the Discerning Companion Animal Insured.
By Adam P. Karp, Esq. © 2012

Quirks. VPI will not cover diagnosis and treatment for “age-related changes” to eyes and ears. Healthy Paws defines “accident” as an unexpected and unintended event causing injury. My concern is that it appears not to cover intentional harm to your animal by a third party (e.g., neighbor shoots cat). Healthy Paws defines “medication” as only that which is FDA-approved, raising the concern that many veterinarians use medicines off-label (i.e., in a manner not expressly FDA-approved). PetFirst will not cover procedures outside the U.S., so if you travel to Canada or Mexico with your animal, do not expect reimbursement.

Vet Malpractice. Another concern is whether the duty to cooperate and share information with the insurer in disputing a claim may result in your statements being used against you in any later suit against your veterinarian, particularly where you allow the veterinarian to speak at length with the insurer. Absent an agreement by the insurer not to share your statements with the veterinarian, this may result in your waiving any anticipation-of-litigation privilege. In any event, you must exercise care in accurately and precisely communicating to your insured the details of a claim as those statements may prove self-defeating.

Affiliations. Consider each insurer’s bedfellows and determine if their affiliates support or oppose your positions on important animal issues. For instance, the AKC markets Pethealth. Repeatedly in cases where animal guardians have sued those responsible for the wrongful deaths of their dogs and cats, asking for compensation properly calibrated to the intrinsic value and emotional distress suffered, the AKC has retained counsel to file amicus curiae (“friend of the court”) briefs asking appellate courts throughout the nation to limit damages to fair market value and deny emotional distress damages (except in cases of intentional or malicious harm), in essence protecting those in the animal industries (e.g., pet product manufacturers, veterinarians, pharamaceutical companies, feed companies) from ever paying more than the cost to just buy or adopt another dog or cat as the full extent of their negligent conduct. The AKC also endorses irresponsible practice of breeding purebreds despite the undisputed overpopulation crisis resulting in millions of deaths of homeless dogs in the nation’s shelters. It amplifies this shortsighted position by opposing breeding permits, breeding bans, and mandatory spay/neuter legislation. Further, the AKC has taken the position that “Debarking is a viable veterinary procedure,” that ear cropping, tail docking, and dewclaw removal are “acceptable practices integral to defining and preserving breed character and/or enhancing good health,” and that using dogs in research is acceptable provided “all efficacious alternatives” are first explored. See

Better Business Bureau Complaints. This nongovernmental organization rates businesses and offers dispute resolution services. It also evaluates each of the pet insurance companies. As of early January 2012, I found the following BBB ratings, accreditation statuses, and complaint histories. PetPartners and PurinaCare are not accredited but nonetheless have excellent ratings.

Below I provide the total number of complaints closed in the last three years and twelve months, and indicate the number not resolved (meaning that BBB found the insurer made a good faith effort to resolve the complaint but the customer was dissatisfied with the response).

The best complaint history in terms of total grievances belongs to Healthy Paws (0), and in terms of unresolved grievances is Healthy Paws and Embrace (0), though the reader should note that Embrace resolved all three complaints to consumer satisfaction.

The worst complaint history in terms of total grievances belongs to VPI (105) and Pethealth (99), with unresolved percentages of 19.0% and 22.2%.

The worst percentage of unresolved grievances goes to PurinaCare (67%), though it only had three complaints in three years.

To adjust for the total number of complaints in determining the real import of the unresolved percentage, I weighted the percentages by the fraction of three-year complaints for the subject insurer against the total number of complaints in the last three years among all insurers (395). With this weighting, the worst record goes in this order: Pethealth, VPI, ASPCA, Pets Best, Petfirst, Petplan, Trupanion, and then PurinaCare.

The reader should keep in mind the missing variable: total number of policies active over three-year and one-year periods. VPI has been in business the longest and has by far the largest market share, so one would expect a greater total number of complaints. The relevant question is whether the number of complaints is proportional to the number of policyholders. For instance, if VPI has 500,000 policies but those policyholders lodged only 105 complaints with BBB in three years, yet a competitor with 10,000 policies had only half the number of complaints, putting aside whether the complaints are, in fact, resolved, one benchmark of consumer satisfaction (i.e., total number of complaints) would cast VPI in a very favorable light (99.98% of policyholders had no complaints) over the competitor (94.50%). According to Pet Airways (, which recently partnered with VPI, VPI has nearly 500,000 policyholders. (publishing Packaged Facts), claimed in May 2008 that VPI had 71% market share, Pethealth 12%, and ASPCA 7%. Trupanion’s website estimates that Pethealth has 15-20% market share and is growing.


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