Washington State Passes Consumer Protections for Pet Insurance

Washington State recently implemented model legislation from the National Association of Insurance Commissioners that regulates pet insurance.

Pet insurance is a relatively new product that has grown in popularity with the increasing prevalence of pet ownership in the United States. Industry statistics reflect an increase of over 2 million in the number of pets insured nationally since 2017.

Unfortunately, this emerging product line has been riddled with complaints of unfair business practices. Policyholders complain of insurers misrepresenting coverages, hiding exclusions, and failing to pay claims. These issues have led to significant regulatory enforcement from Washington’s Office of the Insurance Commissioner.

The new pet insurance statutes are an attempt to fix these problems. The new law establishes clear definitions for pet insurance terms like “chronic condition”, “preexisting condition”, and “veterinarian.” It requires policies using these terms to follow the statutory definition. This helps make sure consumers know what they are getting when they buy pet insurance.

The law also requires disclosure of important exclusions. Policies must state exclusions in specific language. They must explicitly identify limitations based on things like preexisting conditions or hereditary disorders. Agents selling pet insurance must also be appropriately licensed and trained

And the law gives consumers a 15 day “free look period” to change their mind and return the policy to get their money back.

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