Pet insurance rates can be confusing and many pet parents do not fully understand how their pet’s insurance premiums are calculated. This is largely due to the fact that pet insurance rates vary greatly from company to company. There are, however, some general baselines that help determine a pet’s insurance premium. Here are the factors that affect the price that you pay:
Age
Most pet insurance policies take a pet’s age into account when deciding on rates. Older pets will be more expensive to ensure than younger pets as they tend to fall ill easier and more often. Additionally, pet insurance premiums will increase as a pet ages due to rising medical expenses and increased risk of illness.
Breed
Just like cars, different dog breeds are associated with different levels of risk. Insurers look at historical data and previous claims to determine which dog breeds cost the most to insure. Then, they base their premiums on this information.
Location
Location plays a large role in a pet’s insurance rates. Cities with higher cost of living can expect to pay more than areas where cost of living is less expensive. Additionally, cities with higher population have increased risk of certain pet injuries, such as car impacts and poisoning, than certain rural areas. This will factor into pet insurance premium rates.
Species
Your pet’s species will generally play a sizable role in its insurance rates, as it turns out. Dogs are more expensive to insure than cats due to the fact that they see the vet more often and are more likely to utilize their benefits. In this same vein, a horse will be more expensive to insure than a lizard and so forth. If you have bought insurance for your pet lizard, we’d love to hear from you!
Deductibles
Pet insurance policies with a high deductible will generally have a lower monthly premium whereas a low deductible will result in higher monthly payments. Additionally, the frequency of the deductible has the potential to either raise or lower the policy’s premium.
Base Rates
Every insurance policy features a base rate, which is the basic guideline for how much individual policies will cost. Companies determine this number based upon factors like the cost of the policy itself before adding in animal-specific considerations like breed, species, location and age. Base rates are generally fixed within a company and may go up or down depending upon the market and various other external factors.
Ways to Reduce the Cost of Your Pet’s Insurance
- Compare quotes and premiums as some companies might have a better deal than others. And if you have yet to become a pet parent and are looking at costs at different providers, consider the breed. Some breeds, of cats and dogs especially, are more prone to medical conditions and as such cost more to insure.
- Remember to vaccinate: keep your pet’s vaccinations up to date, as looking after their health and safeguarding them against potential illnesses may result in a lower premium.
- Installing extra security for your pets (getting them micro-chipped) could also mean you are offered cheaper insurance.
- Lastly, try to increase your deductible or, if you’re in the UK, your excess: affordable policies usually include a higher than usual deductible or excess.
Like auto insurance, pet insurance policies are often confusing and consider various factors. Be sure to shop around before you pull the trigger.
Photo ©iStock.com/monkeybusinessimages
