ASPCA Pet Insurance
ASPCA Pet Insurance is part of the Crum & Forster Pet Insurance Group, which is one of the U.S. pet insurance market’s four largest providers, according to Consumer Reports. The largest provider is Nationwide, followed by Trupanion, according to numbers provided by both companies to TCR in late November 2020.
The American Society for the Prevention of Cruelty to Animals (ASPCA) has no administrative role in the ASPCA insurance product. However, there is a financial relationship: ASPCA receives a fee from Crum & Forster, the insurance company, in exchange for the use of the nonprofit’s name and brand to sell insurance.
ASPCA Pet Health Insurance is one of several brands operated by the Crum & Forster Pet Insurance Group, along with Hartville Pet Insurance, 24PetWatch, and PetPremium. Spot, Pumpkin, and PrudentPet are also administered by Crum; however, they are not trademarks of U.S. Fire Insurance.
In 2018, according to ASPCA’s financial filings, the non-profit earned $9.4 million “in royalties, licenses, and other.” Much of that came from a partnership in which Crum & Forster, a global multi-product insurer — pays licensing fees to sell pet insurance under the ASPCA name.
Licensing a prestige brand name to sell a product is standard business practice. The question then becomes whether the prestige brand is deceiving customers by lending its name to a product whose own values and quality match those for which the brand stands – or, worse, is implying that it has more of a link to the brand and what it stands for than a simple payment to use its name.
After TCR provided the ASPCA Insurance website with the kind of information a potential customer is asked to provide, a deluge of marketing emails followed, attempting to sell insurance, all bearing the ASPCA name. Only in the fine print at the bottom of the marketing materials are consumers made aware that the non-profit organization is not in the pet insurance business.
The Canine Review conveyed detailed email and phone requests for comment about the nature of the arrangement between nonprofit ASPCA and Crum & Forster to ASPCA president and CEO Matthew Bershadker, ASPCA spokespersons Alexander Craig and Danielle Arnold, Crum & Forster spokesman Travis Reynolds, and Crum & Forster CEO Marc Adee. All parties declined multiple requests to comment. Our questions included whether there are any conditions apart from an exchange of fees to which Crum & Forster must adhere when using ASPCA’s name? For example, does ASPCA require that claims are processed within two weeks and appeals adjudicated within four weeks? Does the nonprofit insist that C&F have a stated target for how much money it aims to pay out on veterinary invoices out of every dollar a member pays in?
The Canine Review also asked ASPCA and C&F executives whether there exists any written or oral agreement between the ASPCA and Crum & Forster to administer insurance in keeping with the core values of ASPCA’s mission; how the insurance policy’s cancel clause and pattern of claims denials would be in keeping with that mission; and if it would be possible for The Canine Review to read ASPCA’s license agreement with Crum & Forster. The parties declined to answer.
In 2019, the Washington state Insurance Commissioner cited the United States Fire Insurance Company, which sells pet insurance using the name “ASPCA Pet Health Insurance” for, among other violations, practices seemingly designed to fool consumers into believing they were entering into an insurance relationship with the Association for the Prevention of Cruelty to Animals (ASPCA). “United States Fire Insurance Co., Wilmington, Del.; fined $25,000, order 16-0192. “United States Fire Insurance Co. sells pet insurance under the brand name ASPCA Pet Health Insurance,” the state regulator’s press release said in April 2019. ASPCA punted TCR to Crum spokesman Travis Reynolds who did schedule a telephone interview, only to cancel that interview.
Read Cancel Clauses Carefully
Crum & Forster sells its pet insurance through subsidiaries which include ASPCA Pet Insurance, Hartville, and PetsPremium. By far, one of the biggest potential traps in the policies it sells is the hard-to-find, but easy-to-understand clause the company inserts into all its policies, which gives the company the right to cancel a policy with 30 days advance notice for reasons that include “a material change that substantially increases the probability or severity of a covered loss.”
In other words, if your dog gets sick, ASPCA’s policy is written in a way that gives the insurer an emergency button through broad discretion to cancel your insurance.
Crum customer service representatives could not explain the clause beyond stating, emphatically, that it’s not a clause that’s ever been applied to their knowledge. Which begs the question: why have the clause? Why does U.S. Fire Insurance, the underwriter for Crum, have a clause that says the company can terminate the policy if there is “a material change that substantially increases the probability or severity of a covered loss.” In other words, the clause seems designed to address exactly the cancer hypothetical we asked about.
TCR could not find any examples of complaints online referring to the “cancel” clause, but ours was a relatively cursory review and many of our public records requests for consumer complaints are still pending.
Transparency Watch
ASPCA Pet Insurance does publish full-text sample policies on its website, though it did take almost a full minute of clicking to find sample policies.
Still, that’s less time than we’ve spent trying to find sample policies on the websites of Petplan, Nationwide, FIGO, and Lemonade. That’s because those websites do not offer consumers sample policies.
Annual Reimbursement Limit = Less Risk Exposure For Insurance Companies
Pet insurance policies with maximum annual payouts for less than $100,000, especially for a dog over five, is a great deal if you are the insurance company. It’s an even better deal if the maximum does not exceed 20 or 30k.
Reimbursement limits are especially challenging for new pet owners because new pet owners are more naive about the cost of veterinary care; $10,000 might seem like more than enough for a single year to a less experienced pet owner.
What’s interesting is that even though the insurer’s website offers only plans with maximums, it turns out that it is possible to buy ASPCA pet insurance without a maximum. Call them and ask for the unlimited plan, and then they sell it to you.
Pitfalls
ASPCA, the nonprofit, allows the insurance company, Crum & Forster, to license the ASPCA name for a fee. ASPCA, the nonprofit, has no administrative role or oversight in ASPCA Pet Insurance. In 2018, according to ASPCA’s financial filings, the non-profit earned $9.4 million “in royalties, licenses, and other.” Much of that came from a partnership in which Crum & Forster, a global multi-product insurer — pays licensing fees to sell pet insurance under the ASPCA name.
- There is a “cancel” clause in this policy and all pet insurance policies underwritten by United States Fire Insurance which states that the carrier “may also cancel your coverage by giving you at least 30 days notice for any of the following reasons….” c. “There is a material change that substantially increases the probability or severity of a covered loss.”
When asked about this clause by TCR reporters who did not reveal their identity, insurance customer support agents said that they were certain that no person had ever had a policy canceled due to the cost of claims.
- This insurance product pays claims by making a determination of the “usual and customary costs.” In other words, your costs are calculated by the insurance company, and not based on the amount that you actually paid your veterinarian for your dog’s medical care. Healthcare.gov provides the following definition of UCR (usual, customary, and reasonable costs): “The amount paid for a medical service in a geographic area based on what providers in the area usually charge for the same or similar medical service. The UCR amount sometimes is used to determine the allowed amount.” This is perhaps the most significant pitfall consumers should be aware of.
- This insurance product’s base policy excludes [“unless covered by an applicable endorsement] “any Hereditary, Genetic or Congenital Condition including those Conditions that are related, secondary, or resultant from any Hereditary.” Any number of medical events in an animal’s life could be characterized as “hereditary.” It’s a highly subjective exclusion, leaving much discretion to the provider.
Pro’s
- One of few pet insurance providers in the U.S. that offers medical insurance for horses.
- Accidents, Illness, and Wellness coverage are available
This insurance product appears to be steering potential enrollees towards its least valuable plan options with the lowest possible levels of risk exposure.
Although the product does offer plans with unlimited reimbursement options through its live customer service agents by phone, the average consumer has no way of knowing this.
On the provider’s website, however, the highest annual reimbursement limit is $10,000.
Yes.
No, but an optional preventive care plan can be added to the base plan. Important to note, however, that wellness benefits are itemized and that the annual maximums listed [https://d3544la1u8djza.cloudfront.net/SamplePlans/v41/SAMPLE_v41_PrePrime.pdf] are a small fraction of what veterinary wellness care costs, in most major cities in the U.S.
There is an optional preventive care plan (can be added to the base accidents + illness plan).
Yes.
There is an optional preventive care plan.
In 2019, the Washington state Insurance Commissioner cited United States Fire Insurance, the insurance underwriter (which sells pet insurance using the name “ASPCA Pet Health Insurance”) for, among other violations, practices seemingly designed to fool consumers into believing they were entering into an insurance relationship with the American Society for the Prevention of Cruelty to Animals (ASPCA). “United States Fire Insurance Co., Wilmington, Del.; fined $25,000, order 16-0192
United States Fire Insurance Co. sells pet insurance under the brand name ASPCA Pet Health Insurance,” the state regulator’s press release said in April 2019.
