Pet Project

When it comes to health insurance, it's man vs. animal.


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Responsibly following the debate over health care reform? Reading the editorials? Watching the president’s speeches and his opponents’ responses? Casually perusing the 223 pages of Montana Senator Max Baucus’ long-anticipated proposal? If so, you probably didn’t notice that this month — when the country’s efforts to cover tens of millions of uninsured citizens, and lower costs for the rest, is hitting a climax — just happens to be Pet Health Insurance Month.

“You lie!” you blurt out. “It’s true!” I respond.

The effort is of course symbolic: Various agencies and industries have declared September to be National Sewing Month and National Coupon Month and National Preparedness Month and National Cholesterol Education Month. These attempts aim to raise awareness of and appreciations for sewing and coupons and emergency preparedness and cholesterol checks and pet health insurance. The people behind these campaigns hope that the public says to itself, I never knew we had a pet health insurance industry!, and then goes out to buy coverage. The danger now may be that it instead thinks, We have a pet health insurance industry?, and then goes back to worrying about job security and credit cards and morgatges.

Bear with me here. I am fully aware that a discussion of insurance for pets! sounds like it belongs at the tail end of a local newscast. I would agree, if the annoying fadishness its name suggests didn’t mask such a deep and broad history.

So what quirky, go-getting American entrepreneur is responsible for pet insurance? None. Animal insurance began in Sweden in 1890, when Claes Virgin wrote the first insurance policy for a horse. The company he founded, Agria International, is today the major pet insurer in Europe, particularly in Scandinavia, where the insuring of animal companions is very popular. According to the company, 25 percent of the dogs in both Norway and Finland are insured. In Sweden, an astounding 80 percent of dogs are covered (cats, alas, get short shrift, with 20 percent of Sweden’s insured, but only one percent of Norway’s and Finland’s covered).

It took a while for pet insurance to catch on in the United States. Credit goes to a veternarian named Jack Stephens, who in 1980 started VPI Pet Insurance — today the nation’s largest pet insurer. In a 2007 interview with Veterinary Economics, the animal doc attributed his motivation to a particularly troubling case. According to Stephens, a woman and her daughter brought their ailing dog to him. They told the vet to do whatever he could — the pet was like a member of the family, after all. Stephens told them what the animal needed:

But then [the mother] said, “Give us an estimate. ” She stepped behind her daughter and started shaking her head no — her daughter couldn’t see it but I could. She kept asking, “Is there anything else? ” And I’d say, “We could try this and not do the test, but that’s not best. ” She kept shaking her head, and I finally said, “Well, the last alternative is to put her to sleep. “And she said, “Well, if you think that’s best, doctor.”

Stephens later saw the two in a grocery store. When the daughter identified him as the person who “killed” her dog, Stephens says he swore off what VPI today calls “economic euthenasia,” and the American pet insurance industry was born. The North American Pet Health Insurance Association estimates that today two to three percent of American pets are insured.

Despite the obvious parallels with human health insurance, coverage for pets works a bit differently. Instead of paying the provider directly, pet insurers reimburse an animal’s owners for treatment they pay for themselves. There’s a weird trend among pet insurers to tout the claims they’ve paid on their Web sites — pet owners, it seems, need to be convinced that they’re not just throwing money into a black hole, and that they will get paid. PetSecure, for example, paid $3,032.79 last month for Dexter the cat’s care (“Injury Resulting From A Fall From An Elevated Area”). ShelterCare covered $2,000 of a $2,064 bill for Nakai the dog, who slid on ice and crashed into a boulder. Barbara P. of New Jersey went through the ASPCA for coverage: “I had been thinking about getting pet insurance, for some time…Lucky for all of us I did. A month after signing up both my dogs, they decided to help themselves to an unopened large box of chocolate covered liqueurs.” And Embrace? “Embrace reimbursed nearly $4,000 for Fletcher’s fanbelt injuries.”

Dogs and cats are the most popular pets to insure, but you can find coverage for a whole host of animal companions. VPI, for example, covers amphibians, birds, chameleons, chinchillas, ferrets, geckos, gerbils, goats, guinea pigs, hamsters, hedgehogs, iguanas, mice, opossums, potbellied pigs, rats, rabbits, snakes, sugar gliders, tortoises, and turtles — reimbursable treatments range from shell rot to excessive egg laying.

As a whole, the insurance industry is not as romantic about animals as is, say, Barbara P. A study by the Insurance Information Institute released this week found that dog attacks constitute a third of all homeowners insurance liability claims, representing $387 million in payouts. And not all animal insurance is aimed at helping save a pet. Farm animals have long been insured. Classic Insurance offers full mortality coverage for police dogs (“No waiting for next year’s budget, pleading with city councilmen, or holding bake sales!”). The Lester Kalmanson Agency covers exotic animals in zoos and carnivals and circuses because, after all, “Whenever a beloved animal dies, it’s always a painful loss. But when a highly trained animal dies, it can also be a very expensive loss.”

Pet owners can sometimes be a breed apart. The money we lavish on pets, and what such spending says about our relationship to them, is a well-traveled area of cultural study — the most notable examples being Ginger Strand’s tour of the Global Pet Expo for Orion magazine (“What’s the Use of Pets?”, 2007) and Michael Schaffer’s new book One Nation Under Dog (excerpted in The Boston Globe). The American Pet Products Association estimates that Americans will spend $45.4 billion on their pets this year. $12.2 billion of that will be spent on veterinary care, yet pet insurance can still come off as kooky — as over-the-top as animal spa treatments and antidepressment medication seem to the people who don’t buy them.

But like all other forms of insurance, coverage for pets is just another calculation of risk. When it comes to a pet’s health, its owner is — to borrow the term — a kind of death panel. Do you believe a pet should have medical care? How much are you willing to spend? Is cost not an object? Or is it, so you take out a policy and make monthly payments so that when your dog inhales a fishing hook, you don’t have to think twice about how you’ll pay to get it out?

Questions related to the environment and the living world are almost always made collectively, if not necessarily democratically. What piece of land is worth preserving? Should animals be kept in zoos? Is it wrong to use animals in medical research? How do we balance the needs of industry and economy with those of the ecosystem? But when it comes to a pet, so long it isn’t abused, the decision on how it exits this world is entirely in the hands of its owner. It’s an area of personal liberty of the very American sort, which may explain why a social-system superstar like Sweden has such a high rate of coverage.

For the Barbara P.’s of the country, pet insurance is a no-brainer. As for the owners of the other 97 percent of pets, well, yes, their pet may bite a sea urchin or be crushed by a cow or eat a corn dog stick or the gel packet from a bra or 15 pacifiers. But many of them are uninsured themselves and know that sometimes all you can do is take things day by day. • 18 September 2009