The State Legislature has the power to put a new set of regulatory requirements into place.
The pet insurance industry is growing nearly as fast as the animal companion market, itself, and it is now getting ready to face a range of new regulatory requirements in the case the legislation in front of the California State Legislature should move ahead.
The new bill being considered was sponsored by Insurance Commissioner Dave Jones.
AB 2056 would work to improve consumer protection by way of “bringing uniformity to policy language and disclosures, increasing transparency in pet insurance policies.” This is considered to be particularly key when it comes to the differences in definition of what makes up a “pre-existing condition” which can vary widely from one policy to the next. Every year, the California Department of Insurance receives almost 100 complaints regarding this type of coverage, every year.
The wording of pet insurance policies is causing many consumers to misunderstand their coverage.
The Department explained that “pet owners often purchase policies either not knowing that pre-existing conditions are not covered or the policy language is unclear as to what constitutes a pre-existing condition.”
Should the new legislation pass, it will mean that there will be a number of standardizations of terms such as the “pre-existing condition”. That term will become one that makes reference to any condition for which a veterinarian has previously provided medical advice, for which the animal has received treatment, or of which the pet has shown symptoms or signs that are consistent, before the insurance policy’s effective date or within the policy’s waiting period.
By setting this specific type of definition into place, the goal is to provide protection for both pet insurance companies and for consumers, alike. This, according to the deputy commissioner and special counsel for the Department, Geoff Margolis. He explained that the goal was to ensure that a fair definition would be created so that the pet owner would understand specifically what it was, but also to ensure that the definition was actually fair to the insurer. Margolis pointed out that this new definition makes it unlikely for individuals to be able to “game” their insurers by taking their animals to the vet and discovering that there is a condition present, and then purchasing coverage for that condition after the fact.