What is pet insurance—and do you need it?

As pet insurance becomes more common and available, you’ll have better opportunities to select the coverage your pet needs at a price you can afford. Before we get into the costs, let’s step back and see just what pet insurance is and what it covers so you can decide if your pet needs a policy in the first place.

What is pet insurance?

Pet insurance is a type of insurance policy that you purchase from an insurer that offers this specialized form of coverage. 

You’ll pay a monthly fee, called a premium, to keep your policy active (and your pet covered). If you need to take your pet to the vet for a covered issue (like an accident or illness), you pay the deductible and the insurance company kicks in to reimburse you for the remainder of the bill.

Think of pet insurance as a way to protect your finances from an unexpected medical expense for your dog or cat, which can run in the thousands.

What does pet insurance cover?

Just like health insurance for humans, pet insurance offers financial assistance for medical conditions and treatments that your furry friend might need. Although coverage varies, pet insurance usually pays for:

• Emergency medical care
• X-rays
• Surgeries
• Accidents or illnesses
• Emergency dental work (e.g., from an accident)
• Diagnostics and medication

What does it not cover?

As with any type of insurance, there are often exclusions. The most common ones include:

• Wellness check-ups
• Routine dental work
• Vaccinations

Some insurers do not cover specific dog breeds or pets when they reach a certain age. Your pet’s pre-existing conditions may also be excluded, such as an existing injury or allergies.

Since it’s up to each insurance company to determine what they do and don’t cover, carefully read each insurer’s guidelines before you sign up for a policy.

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How pet insurance works

Once your pet has a pet insurance policy, you can use it to access medical care. Depending on your plan, coverage may or may not include annual wellness exams or routine vaccinations—but most include emergency care.

For covered conditions, you typically take your pet to the vet, pay for the care, and then submit a claim to your insurance company—either online or by phone. If your claim is approved, you’ll pay your deductible and be reimbursed for the remainder of the eligible expenses. 

Note: Some insurers automatically subtract the deductible from your reimbursement, so it’s a good idea to check with your provider to understand how claims are paid.

How much does pet insurance cost?

Like any insurance product, the price you pay is based on individual factors like:

• Breed
• Age
• Medical history
• Location
• Deductible amount
• Coverage options

Generally, you can expect to pay around $45–$120 per month for a dog or $25–$60 per month for a cat with an accident and illness policy. Remember that your costs may vary depending on your pet and the coverage you select.

Keep in mind that the price of pet insurance may change as more insurance providers emerge in Canada and AI innovations could streamline the underwriting process. 

To find out how much pet insurance would cost in your specific situation, request quotes from several insurance companies. Try to use the same coverage types and amounts so it’s easier to do an even comparison of the policies, and don’t forget to ask about potential discounts!

Do you need pet insurance?

Now that you know the ins and outs of pet insurance, you may be wondering if it’s worth it to purchase coverage. To help you decide, consider the costs of average vet bills. For instance, an emergency vet visit costs between $800 and $2,500, on average, in Canada. However, fewer than half of pet owners could handle even a $1,000 emergency bill without financial difficulty.

With the average annual cost of caring for a dog at $3,000 (and cats at $2,000), many pet owners might struggle to cover an expected illness or accident. 

Take an honest look at your finances and pay particular attention to your emergency savings. If you don’t have any or wouldn’t be able to cover routine or emergency care for your pet, then purchasing a pet insurance policy can be a smart financial move. 

Fortunately, it’s becoming easier to find coverage. According to a 2025 pet insurance study, the Canadian pet insurance market grew 15% in the past year. This gives pet owners more options when it comes to choosing an insurance provider and selecting a policy that works for them. 

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About Jessica Gibson

Jessica Gibson is a personal finance writer with over a decade of experience in online publishing. She enjoys helping readers make informed decisions about credit cards, insurance, and debt management.

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