California has taken a major step forward in pet insurance reform with Governor Gavin Newsom signing SB 1217 into law on September 26, 2024. This groundbreaking legislation strengthens consumer protections and requires unprecedented transparency from pet insurance companies operating in the state.
The new law comes at a critical time as the US pet insurance industry has experienced explosive growth, with gross written premiums surpassing $4.7 billion in 2024 according to the North American Pet Health Insurance Association. With over 6.4 million pets insured nationwide, the need for stronger consumer protections has become increasingly apparent.
Key Provisions of the Reform Legislation
SB 1217, authored by Senator Steven Glazer, introduces several significant changes to how pet insurance operates in California. The legislation requires insurers to provide greater clarity regarding coverage changes based on a pet’s age or geographic location, addressing long-standing consumer complaints about unexpected premium increases.
One of the most important aspects of the reform is the requirement for clearer policies regarding pre-existing condition exclusions. Pet owners have often faced confusion and disputes over what constitutes a pre-existing condition, leading to denied claims and financial hardship during medical emergencies.
The law also establishes a clear distinction between wellness programs and actual insurance coverage, helping consumers understand exactly what they’re purchasing. Additionally, insurers must now issue coverage beginning the second day after receiving a complete application and payment, streamlining the enrollment process.
Impact on Pet Owners and the Industry
This reform addresses growing concerns about accessibility and affordability in pet care. As Governor Newsom stated, “Every pet deserves a home – and every home is happier with a pet – but the rising costs of pet care and the growing number of animals in need of adoption present real challenges.”
The legislation is expected to particularly benefit California’s pet owners, who represent a significant portion of the nation’s pet insurance market. With the state’s high veterinary costs and large pet population, these protections could save consumers thousands of dollars in disputed claims and provide greater peace of mind when making coverage decisions.
Industry experts believe this legislation could serve as a model for other states considering similar reforms. The pet insurance sector has grown from $2 billion in gross written premiums in 2020 to over $4.7 billion in 2024, making regulatory oversight increasingly important for consumer protection.
The reform also supports California’s broader animal welfare initiatives, including efforts to address shelter overcrowding through improved access to affordable veterinary care. By making pet insurance more transparent and reliable, the legislation may encourage more pet ownership while ensuring animals receive necessary medical treatment.