Pet Insurance: Know Your Coverage

UNITED STATES  --  The cost of pet insurance varies depending on the age of your pet, the breed, and, like insurance for humans, the amount of your deductible.

It tends to average several hundred dollars a year, so consumer reporter Lynda Baquero explains how pet insurance works and how annual caps apply.

Three-year-old Dolly is recovering from surgery, after recently suffering one of the most common knee injuries in dogs.

"And when she was on her feet, I noticed that her feet would, like, wiggle. She had no strength to really stand on them. Ultimately she tore her ACL, that's what she did," said Dolly's owner Wendy Frankel.

Wendy turned to her pet insurance with Nationwide. For Dolly, she pays $800 per year for coverage.

"And then I had called ahead of time and I said, 'what do you think I'm going to end up getting?' They said, well probably $2,750."

The procedure was estimated to be anywhere between $7,100 and $7,700.

Wendy says the $7,000 charge is because she was getting both of Dolly's knees repaired at the same time. She felt it would be an easier recovery for the dog.

"And also it will be less costly, also she doesn't have to go under twice."

She decided to go ahead and pay for the surgery, even though Nationwide explained her maximum benefit would only be $2,750.

"Because there's a ceiling, that's it. They don't want to go above and beyond that's it."

The other option meant waiting until July when her policy renews and the annual maximum benefit replenishes.

"She probably would have destroyed her legs. There wasn't a choice. She got sick, I have insurance, they told me they have the best plan they could offer, and it's not good!" said Wendy.

In a follow-up story, Nationwide--who said it was honored to have the Frankels as members for 15 years--explained Wendy received the maximum benefits based on her policy and that the benefit is per annual term, not per knee. They added that the health of their members' pets is paramount, and they did not advise the Frankels to postpone their dog's surgery. Nationwide sent Wendy a check for nearly $3,000--the annual policy maximum.