Skip to content

How to Choose the Right Pet Insurance in Canada

Dalmatian dog smiling with tongue out

Choosing the right pet insurance in Canada can be difficult, especially in a crowded marketplace. There are many different pet insurance companies and policy types available to pet owners. If your pet suffers a serious injury or illness and you’re not insured, the treatment could cost you thousands, and create a serious financial burden. At PHI Direct, we believe that planning for unexpected illnesses and injuries with pet insurance is essential.

Understanding some key aspects of pet insurance will help you pick the right policy for you and your pet. We’ve put together this article to explain the basics, so you can feel more confident in how you approach choosing pet insurance for your puppy or kitten.

Care for the worst case-scenarios

Much like other types of insurance, pet insurance exists to financially protect us (and our pets) from things that we didn't want to happen! On a large-scale, lucky pets who rarely suffer from major injuries or illnesses help to cover the veterinary costs of unlucky pets. Nobody knows whether they will have a lucky or unlucky pet but everyone gets to reduce the financial risk of large veterinary costs coming out-of-the-blue.

At PHI Direct, we have structured our pet insurance policy to help pets and their owners at the moment when they need it most - when their pet first gets sick. This is why we use new-condition-coverage (which we'll explain later in this article), which helps to keep monthly premiums low, and we currently have a choice of two annual maximum payout options.

Pet Insurance Deductible - Annual vs Per-Incident

With pet insurance, you’ll receive reimbursements on the eligible claims you make for treatment when your pet gets sick. The repayment amount you receive for the eligible claim will be determined, in part, by the size and type of your deductible. A deductible is essentially the amount that you have to pay towards your vet bill before your policy coverage kicks in. It can come as either a per-condition deductible or an annual deductible. Generally speaking, the higher deductibles you pay, the lower your policy premiums will be.

With per-condition deductibles, you generally only have to meet the deductible once for each different condition. Once the deductible is met for that condition, you would never have to meet it again (as long as you keep your policy). Trupanion is one example of a pet insurance plan that uses this type of deductible. These can be valuable if your dog or cat experiences a small number of ongoing conditions in their lifetime, as the deductible only has to be met once for as long as your policy is in effect vs resetting every year.

But what is an annual deductible for pet insurance? An annual deductible for pet insurance is the amount of money that you need to pay on eligible claims for your pet prior to your pet insurance plan payments starting. They are considered an annual deductible because they reset each year. These can be advantageous because there is only one deductible to meet each year (vs potentially several if your deductible applies per condition - as above). Once the annual deductible is met in each policy year any other treatments your pet receives in that year will be unaffected by deductibles at all.

Choosing the right kind of deductible is important, as either way could save you money depending on your type of pet and their lifetime health needs. Looking at things like common conditions for your pet may help with decision-making, especially as you look ahead to your dog or cat becoming a senior pet.

Payouts - percentages & annual limits

Your payout percentage is how much you’ll be reimbursed for eligible claims on the treatments that your pet receives over your policy period, with most policies offering somewhere between 60% and 90%. The payout percentage can also be called the benefit rate, and it can differ between annual and lifetime policies. With a 100% payout percentage benefit rate, a treatment that costs $450 will be paid back to you in full (minus any applicable deductible costs), while an 80% payout would return you $360.

When wondering how to choose pet health insurance, it’s also worth considering the payout or benefit limit for the policy. This is a figure that your total collective reimbursements cannot go over within your policy period. If your payout limit is $5,000 for an annual policy, you’ll only receive up to that figure collectively with every treatment your pet receives in the year, and once $5,000 has been reached, you’ll no longer be able to claim. Consider the payout limit and reimbursement rate carefully before taking on a policy.
At PHI Direct, we offer two annual limits for payouts, $5,000 and $10,000. It is unusual for a pet to require larger payouts than this in a single year and this is another way that we have structured our pet insurance policy at PHI Direct to provide quality, affordable coverage for dogs and cats.

Conditions - pre-existing, congenital, and hereditary

One thing that will affect your policy and the rates that you pay will be the presence of health conditions in your pet prior to them enrolling in a new policy. Most policies (but not all) will not cover a pet's pre-existing health conditions or injuries. Also relevant are incidences of congenital or hereditary health conditions, such as hip dysplasia.

Hereditary health conditions are complications that are passed down through genetics from the pet’s family tree, while congenital conditions are conditions present from birth that can be either genetic or due to complications with the birth itself. Thoroughly researching your options is important as some pet insurance policies do not cover hereditary or congenital complications. There are plenty of others that will cover such pets on the condition that symptoms aren’t present prior to the policy being taken on. PHI Direct is one of the pet insurance providers that does cover congenital and hereditary conditions on this basis.


Some pet insurance providers now offer telehealth services as part of their insurance offerings. Telehealth is over-the-phone (or over a computer) guidance for health and injury situations, where an expert can advise you on the best next steps in a given situation for you and your pet. At PHI Direct, we offer telehealth services to our policyholders to ensure that fast expert advice is available when you need it.

The PHI Approach - Fluff-Free and ‘New Condition Coverage'

With PHI Direct, we aim to offer affordable, transparent pet insurance in Canada specifically for situations where it will come the most in handy. Our policies are all annual, providing an 80% payout percentage at limits of either $5,000 or $10,000.

Our policies are also focused on new condition coverage, meaning that we will provide reimbursements for treatments within a policy year, but not for the same conditions or injuries after an annual renewal. This keeps our rates lower while still allowing us to provide valuable support in the times when it’s really needed. Less than 5% of the cats and dogs in North America have pet insurance coverage and at PHI Direct we'd love to make that figure much larger. That's why we've created a product that is transparent and affordable - and most importantly that helps protect the pets we all love.