How to choose pet insurance
What is pet insurance?
Pet insurance is a type of insurance product that helps cover the cost of veterinary care for your pets. Depending on your pet insurance cover, it may reimburse a portion of costs related to accidents, illnesses or even routine care.
What most Australians look for in a pet insurance policy is financial protection from unexpected vet bills, which can quickly blow the household budget and add unnecessary stress to the pet owner.
If you want to keep your fur baby happy and healthy without impacting your finances, choosing a pet insurance policy with the right features is important and can help provide you with peace of mind.
Why do I need pet insurance?
When serious injuries and healthcare conditions occur, not only are these difficult (if not impossible) to plan for, but they can also be devastatingly expensive to fix.
Even with a sizeable emergency fund and cash to spare, many people would struggle to shoulder those costs, especially if their pet requires ongoing treatment. This is where pet insurance can alleviate some of the financial burden by covering a portion of eligible vet bills.
How to choose pet insurance in Australia
You should expect to incur several expenses in the first year of pet ownership, as you may need to cover costs such as microchipping, and preventive care. A basic pet insurance policy may not necessarily cover these costs, but a comprehensive policy might (albeit not the total expenses).
As your pet ages, it makes sense to consider pet insurance to help cover the costs of regular treatments, such as annual check-ups, dental care, flea, tick and worming treatments, as well as prescription diets. Depending on your chosen policy, an optional extra, like routine care, can help cover some of these costs.
You can always start with deciding the level of cover that you want for your pet insurance policy. Types of pet insurance in Australia typically include:
- Accident-only cover: Covers physical and accidental injuries such as car accidents, fights and snake bites. Depending on your insurance plan, older pets may only be eligible for an accident-only policy.
- Accident and illness cover: Includes cover for diseases and medical conditions, such as cancer, skin conditions, cruciate ligament, hereditary conditions, chronic conditions and other health issues.
- Comprehensive pet insurance: Covers both accident and illness, with additional routine care options, such as vaccinations, desexing, dental work, check-ups, physiotherapy, and may even include behavioural training for diagnosed behavioural disorders and conditions.
After deciding on the level of cover that’s suitable for your furry friend, you should compare pet insurance across different providers to ensure that you get the most coverage out of your budget. Remember to weigh the pros and cons of each policy, including the benefit percentages, annual limits and sub-limits, excess and benefit percentage (co-payment) requirements, waiting periods and coverage for hereditary or congenital conditions.
Always read the fine print in the Product Disclosure Statement (PDS) and the Target Market Determination (TMD) to understand the inclusions and exclusions of your policy and ensure that the new policy is the right fit for you.
Choosing the right insurance policy
Choosing the right pet insurance is a balance between what you can afford and the level of coverage your pet needs. By understanding the various policy types, knowing what’s included and excluded, and comparing options carefully, you’ll be better prepared to make an informed decision on the best pet insurance policy for you. Keep these tips in mind:
- Choose a policy with an affordable premium that fits your budget.
- Aim for a high benefit percentage to reduce your out-of-pocket
- Read the PDS thoroughly to understand all terms and conditions.
- Consider your pet’s breed, age and health history; some breeds are more prone to specific conditions.
- Check customer reviews and insurer ratings for claims experiences and service quality.
What to look for in pet insurance
Many Australians struggle with the finer details of insurance policies, which can leave them underinsured, paying more than expected when making a claim or simply paying too much for coverage they don’t need. Understanding the policy can prevent unexpected costs at vet visits and coverage gaps.
Here are some things to look for in pet insurance policies to ensure you’re getting the right cover.
Excess
Depending on your insurance policy, you may or may not have to pay the bill in full first and claim later. However, an excess payment (if applicable) is a payment you make to the vet upfront before you make a claim. If your policy includes an excess amount, then this will be one of the contributions you make when you claim, and it is deducted from the amount your insurer determines you are eligible for. Increasing the policy excess or lowering the benefit percentage will lower your monthly premiums. Whatever you decide, make sure it’s an amount you’re comfortable paying.
Benefit percentage
The benefit percentage (co-payment) is the portion of your pet’s treatment that a pet insurance policy will pay out. Always remember to check your PDS to know your annual benefits and benefit limits for the different veterinary treatments and services, as it may differ across different insurance companies.
For example, if your policy covers up to 90% of your vet’s bill, you’ll be responsible for covering the remaining 10% of the vet’s fees, as well as your excess. Most insurers allow you to choose the benefit percentage, which typically ranges from 60% to 90% but can be higher or lower. The lower the benefit percentage, the more of the vet’s bill you’ll need to pay.
Exclusions
Every pet insurance provider and policy are different, but there are certain vet services that you will not be able to claim for, like elective treatments. Pre-existing conditions will also be excluded from your pet insurance policies, so consider insuring your pet from a young age before they develop any issues. Your Product Disclosure Statement (PDS) will outline the complete list of inclusions and exclusions, so be sure to read it before signing up for any policy.
Meet our pet insurance expert, Adrian Taylor
As a General Insurance expert with over 13 years’ experience in financial services, Adrian Taylor knows that dogs and cats get themselves into all sorts of mischief. One part of Adrian’s work is to help empower consumers to understand how pet insurance can help save them from exorbitant vet bills when their pet gets injured or falls ill.
Want to know more about pet insurance?
1PetSure. Australian Pet Health Monitor 2025. Accessed May 2025.