Pet insurance industry headed for possible regulation in California

If Assembly Bill 2056 continues its smooth progress through California's government, the pet insurance industry could soon become regulated in that state.

The bill was recently approved in the state assembly with a 78-0 vote, according to It now heads to the Senate for consideration and then to the desk of Gov. Jerry Brown.

With an eventual signature by Gov. Brown, California would become the first state to have a regulated pet insurance industry.

The proposed legislation aims to increase transparency of insurance policies so consumers better understand their coverage and don't feel confused or misled about aspects such as exclusions for hereditary diseases or pre-existing conditions.

Assembly Bill 2056 would require pet insurers operating in California to disclose certain information including whether the policy excludes coverage because of a pre-existing condition, a hereditary disorder, a congenital anomaly, or a chronic condition, according to the bill's language. The bill also provides clear definitions of certain terms, invites oversight by the insurance commission by placing pet insurance in the "miscellaneous insurance" category, and gives policyholders a 30-day "free look cancellation period" to return their coverage.

Veterinary Pet Insurance (VPI) spokesman Curtis Steinhoff explained to why the largest pet insurance provider in the United States supports the proposed bill.

"We think that it's important to bring uniformity to policy language and disclosure," Steinhoff said. "Because there are now so many companies in the market, we felt it was important that everyone was playing by the same rules."

If signed by Gov. Brown, the legislation would apply to pet insurance policies in California marketed, issued, amended, renewed, or delivered to a resident of this state on or after July 1, 2015.

NEWStat Legislation & regulation