Is Pet Insurance Worth a Look?

By Diane Tait

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I’m a dog person.  As such I have always had one or more dogs in my household.  While they’re great companions and protectors, what isn’t great is when they get sick or injured.  That’s because where veterinary care used to be relatively inexpensive, in the past 10 years, the price charged by vets is starting to approach those of general practitioners.  As a result, I have to dig deeper and deeper into my pocket for everything from routine visits to the vet to doggy medication and emergency care.  With the rise in veterinary costs has come a rise in pet insurance policies that claim to cover a myriad of issues for a fixed monthly premium.   What I thought I’d do this week is take a look at the pros and cons of pet insurance.

What’s not to like? – Paying a small fixed monthly cost beats digging deep in your wallet every time your pet needs to visit the vet, right?  Not so fast, Sparky.  Just as health insurance for humans comes in a variety of shapes, sizes and costs, so too does pet insurance.  Also, like traditional healthcare policies, pet insurance comes with deductibles, co-pays and exclusions.  Before you sign up for coverage, you need to know exactly what you’re getting for your money. Also, unlike health insurance for people, when it comes to pets, many pet insurers require you to pay the bill in advance, then submit receipts after the fact in order to get reimbursed.  Some pet insurers only cover dogs and cats, while others offer coverage for birds, rabbits, reptiles and other pets.

How much does it cost? – Just as there is no such thing as a blanket health policy for humans, the same goes for pet insurance.  Depending on the age, condition and medical history of your pet, the premiums will vary.  Purebreds are more expensive to insure than mixed breeds.  Older animals cost more to insure than do younger pets.  Most policies exclude preexisting conditions and some exclude breed-specific conditions.  Below is an excerpt from a Consumer Reports article entitled Is Pet Insurance Worth the Cost?

The insurance trade group says that accident and illness coverage per year averaged $473 for dogs and $285 for cats in 2014. Accident-only policies ran $158 and $132, respectively. Embrace and Healthy Paws pay a flat percentage of covered costs after your deductible is met. Other companies calculate reimbursements based on the “usual and customary costs” of vet care in your area. Embrace lets you pick the annual maximum amount it will cover each year ($5,000, $8,000, $10,000, or $15,000); Healthy Paws and Trupanion have no annual ceiling. 

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What does it cover? – Buying pet insurance is like going to a Chinese restaurant.  There are lots of ala carte items.  You’ll need to choose not only if you want your pet to be covered in the event of an accident, but you may also be required to decide whether you want to include auto accidents.  Many carriers require you to opt in or out of coverage for such things as arthritis, cancer, and colitis.  While most policies include routine care and annual exams, coverage of flea/tick treatments, pet meds and vaccinations costs more.

When pet owners see their potential pet premiums going up and up before they even sign on the dotted line, many see red.  What they don’t realize is just like human health care, pet care costs are on an upward spiral. Cancer treatments for pets can easily exceed $5,000 and arthroscopic surgery to mend a torn ACL starts at around $3,500.  (Some orthopedic issues can require multiple surgeries to fully treat, and there’s always the possibility that your pet could recover from an orthopedic issue on one limb only to injure another soon thereafter.)

What do veterinarians say? – All too often, pet owners only decide that pet insurance is worth a look once they shell out thousands of dollars for an operation or emergency treatment on their pet.  At other times, it’s after they’ve had to have their pet treated by a specialist that they fully appreciate how complicated and costly pet care can be these days.  The best way to determine whether you should look into pet insurance is to ask yourself several questions.

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      1.      What would you be willing to spend to help your pet recover from an injury or illness?

      2.      Do you have sufficient money in the bank to cover a pet medical bill of $5,000 or more?

      3.      Is your pet a young pup, or an old dog?  (The younger the pet, the lower the premiums.)

      4.      If your pet is relatively young and healthy you may think having pet insurance isn’t worth the money.  But what if something unexpected happens to your pet that requires surgery?

      5.      Is it worth paying $20-$40 per month to avoid having to potentially pay thousands of dollars for some unforeseen pet emergency?

Costs versus Benefits – There are a number of ways to drive costs down on a pet policy.  For starters, you need to shop around.  There are dozens of insurers that offer pet coverage, including Nationwide, Progressive, HealthyPaws, Pet First, Pet’s Best, Prudent Pet, FIGO, and Hartville. The ASPCA even offers its own line of pet insurance.  It’s also possible to save on premiums by bundling other insurance you have with a pet policy.  Click on the link below to view the Consumer Advocates list of the Top !0 Pet Insurance Companies in 2010.

Other things you can do to cut down on the cost of coverage include opting out of relatively low-cost routine items, asking your vet which optional vaccines can be skipped, and spay or neuter your pet.  Another option is to consider setting up a pet medical fund that you contribute to monthly for future use in lieu of acquiring pet insurance.  You should also ask your employer whether they offer pet insurance as a perk.  Companies such as Adidas, Hewlett-Packard, Levi Strauss, Microsoft, T-Mobile and Xerox offer pet insurance to their employees.  Who knows, if you ask your company’s HR director, you could find that your employer will be only too happy to cover your pet.

Diane Tait owns and operates A&B Insurance.  To find out more about how you can save money on insurance, go to her site or fill out the form at right.