One of the expenses I’ve wrestled with in the last few years is with our pets. Beyond purchasing pet food, kitty litter, a dog bed and other common pet supplies, there is a lot of money tied up in routine and non-routine veterinary visits. Pets are a part of our family as they are for many people. They’re fun to have around and the kids love them.
But, I’ve often wrestled with the question of how much is too much when it comes to paying for pet expenses. Certainly, you want to take care of your pets and make sure they get the care they need. And when they become sick or unhealthy, hopefully, you want to make sure they are treated properly.
So, as someone who is trying to manage money wisely and be realistic about future expenses, I decided to explore further whether or not it makes sense to pay for pet insurance. And specifically, does pet health insurance save money for a family who has pets today and probably will always have pets in the future? If so, you can probably plan for some sort of non-routine care in the future.
How much would you pay?
As an article at MoneyCentral.com points out, the question becomes, how much would you pay for your pet and would you be able to pay that amount with cash? That’s a tough question to wrestle with, if you really think about it. There can be a lot of emotional issues tied up in that decision.
The article points out pet expenses have increased because today Veterinarians can perform a lot of treatments they haven’t been able to perform in the past. With more advanced treatments for health problems and diseases you have more options when your pet is ill. The increased options come at a price.
About the policies
Interestingly, the policies don’t cover all expenses according to the article. They have deductibles that must be met, co-pays and caps on how much can be paid each year. You can also count on the exclusion of certain pre-conditions (maybe we need pet health care reform 
) Premiums also cost more if your pet is older.
Apparently, Veterinary Pet Insurance is the oldest insurer with the largest percentage of the pet insurance market share. I decided to run over to their website and look further into the options available. They offer insurance for dogs, cats and exotic animals. For dogs, they have plans for injury, medical and major medical and different coverage options within each. The medical plan offers 4 deductible options starting at $100 all the way up to $1000. Obviously, a quote is going to differ based on the type of animal and conditions.
So, is pet insurance a good idea?
Consumer reports suggested that pet insurance may be a dog. The article reported there are a lot of exclusions, but even so, statistics show it is still an increasing trend to buy insurance for your pet.
According to the article, the American Pet Products Manufacturers Association says annual surgical vet visits cost on average $453 per dog and $363 per cat.
So, what do they conclude from this information? If you have an older animal which is likely to need treatment (not sure how you can determine that) and can find a policy in which you’d pay less than these amounts per year, you might consider pet insurance.
Alternative approach to pet insurance
But consumer reports does go onto mention if you can’t find insurance cheaper than the above mentioned annual costs, put your money in an interest bearing savings account and build up a savings for such expenses.
This is good advice, in my opinion. Honestly, I wasn’t too high on considering the idea of pet insurance when I started writing and researching this article, but it has spawned an important thought about savings. While it’s a good idea to save for items around the house that may need future repair or maintenance, it would certainly make sense to think about animal healthcare too.
In fact, I think I would feel much more comfortable putting extra money into a savings account or freedom account to plan for such future expenses. Of course, you have to find the extra money in your budget to do so, right? This might take some squeezing, but your pet situation will depend on how hard you need to squeeze.
But at least with socking away this extra money, you’ll have it available if you need it. If you’re pet doesn’t ever require these services you’ll at least have the extra savings. My advice? Save for your pet and skip the insurance.
Photo by e3000
So, what’s your take on pet insurance? Do you think it’s a good idea to buy it?
{ 22 comments… read them below or add one }
I too am in the “put it into savings” camp, though I can see its value. I wrote about this 3 years ago and felt the same way then. I’ve recently learned that our dog needs chemo and it’s gonna cost $2-3,000. She’s mid-life and she’s worth it. However, had I purchased insurance, the sting wouldn’t be as bad. That said, it’s just another insurance product and it’s always a roll of the dice. Chances are the premiums for her insurance will surpass the cost of chemo (not even sure if it would have covered it) and I’m getting the interest on the money in the bank.
Perhaps the best solution is a HSA for pets where I can go a purchase a high-deductible health plan and sock away money in the HSA to use for qualified purchases.
On second thought, that sounds like a head-ache. Just put the money in a special account that bears interest and be done with it.
Thank you for your post
I used to be of the “savings account” camp, as well, (and it’s still a GREAT idea, do not get me wrong) but though I quickly found myself with a balance of $400-500 for my pets (2 cats), I just about had a small coronary when the vet told me at one of the annual appointments that “since it’s dental awareness month, we’re offering $100 off of dental procedures” and when I asked her how much a cleaning was, she said “depending on the extent of the cleaning and whether or not we need to remove any teeth, between $400-600.” I think part of this is inflation (obviously), but part of it (and a LARGE part, indeed) is location. A few years ago, before I moved to my current location, a teeth cleaning (including a few extractions) for my elderly cat was around $150-200, and that was including pre-surgery antibiotics. While we can’t all move around hundreds of miles to look for cheaper or more affordable vet prices, we can shop around within our own communities. So, anyway, in this case, I was appalled. 1. My young cat of 3 years did not need it, and 2. the expense would have emptied out my pet savings account. And even if an animal’s teeth are bad, any type of “cleaning” is normally not covered under pet insurance unless you have a type of “wellness” coverage. Pet insurance usually covers accidents, illness, and injuries.
And even though I’ve just written all of this, and though I still set aside some money each month for my pets, I do pay for pet insurance, slightly above the “minimal” coverage, to include a cancer rider. I do this because cancer can strike at any age, and the prices with testing, lab work, let alone treatment, if it’s possible or feasible, is extremely expensive. I lost my elderly cat to cancer in 2007, and didn’t have pet insurance for her. This cancer option would have covered a portion of the treatment we gave her. And while yes, she was “fun to have around,” she was also a creature, a being in her own right, and any creature we take responsibility of and care for deserve the best we can do by them. That does not mean going into debt to pay for a surgery, certainly not. But it does mean that we should think long and hard about adopting a pet and bringing another being into our homes. If one cannot afford to feed an animal good quality food, give them the love and attention they need, including regular medical check ups and preventative care, then I do not think one should adopt a pet.
Another point regarding pet insurance. IF you are interested, look into it before getting a pet or soon after you do. The younger the pet, the easier it will be to find affordable coverage. While there are (a limited number of) companies who will cover older animals, it is very rare to find a company who will cover an animal with any type of pre-existing condition.
But I do agree with the foundation of your post that at the MINIMUM, it is important to budget pets into our budget.
We have VPI for our dog, and I am alright with the costs solely on an emotional level. I never want to be in the position to have the thought cross my mind about whether the dog is “totalled” where the cost to fix/heal the dog outweighs the utility of the dog.
I love my dog, and the $40 isn’t going to break me, so I’d rather be safe than sorry.
I love my dog….but spending a couple grand on his isn’t going to happen. I figure, he has a good life and when time is up…well….that’s it.
I am a veterinary technician and I have worked in many hospitals before where we had regular clients. Most of the majority did not have pet health insurance, but for the people who did, it was through the one you mentioned the Vet one. The only difference was, they had to pay everything up front and have the doctor sign off on it, and then send off for reimbursement.
Matthew, you’re right. It definitely is just another insurance product and a roll of the dice. I would imagine the premiums, in most cases, surpass the costs, but I realize every situation is different. Still, I like the savings option. If I don’t use it for pet care, I have all the more in savings.
Hey Evan, it’s great to have someone share their experiences with using pet insurance. While I’m still in favor of saving for such an expense, you raise a good point in that you’re not going to have to make an emotional decision in having the coverage. I understand. Having a pet is like another family member and this is a tough call.
It’s funny that you should mention this topic. My wife and I are considering starting a savings account for the healthcare of our beloved guinea pig.
I think that the savings account method is the way to go. The “sticker shock” of the various pet procedures does not invalidate this approach. You have to act as your own insurance underwriter and research how much these procedures cost so that you can determine how much to sock away. To do this, ask your vet for their fee schedule and sock extra away to cover inflation and contingencies.
I have also taken this approach for auto repairs. I have an ING savings account dedicated to auto repairs that is set up much like a payroll deduction. This same approach can be taken for appliance/electronics/whatever service agreements. Consumer Reports does not think too much of service agreements and, lately, neither do I. If you’re offered a monthly service plan, find out how much it is and instead of buying into the plan put it into the bank. That way, if your unit does not need repairs, you haven’t lost anything and may, in fact, have a fund to purchase a replacement unit.
I love pets. but I wont buy them insurance or clothing.
It’s a pet and other than normal taking care of it such as food, a place to live and play, and shots, there is a limit on how much I’m going to pay. If it’s too much, I’ll just get another pet.
I totally agree. We used to have pet insurance (through VPI) on our 2 dogs, and there were so many exclusions that it wound up being more cost effective to not have the insurance and just pay for everything out of pocket. On one occasion, we wound up with a $1,200 vet bill for an emergency procedure, and insurance only paid about $300 of it because they found some exclusions that they wouldn’t pay for. That’s when I did the math and found it was more cost effective to not have pet insurance.
I’m a former shelter director that had my share of experiences with animals being surrendered or abandoned at my shelter because the pet parent couldn’t afford care. And I’ve personally spent over $4,000 on my husky mix over the past eight years of her life for a variety of injuries and illnesses. As long as her quality of life is good, she is going to get the same care that I would give to myself. So I see a real value in pet insurance.
But I agree that many companies do not offer a good plan or have too much fine print. So much so that I wanted to see a new type of pet insurance company, one that actively could play a role in animal rescue and delivered on its promise to protect the pet and the pet parent. So along with some helpful partners we launched Healthy Paws Pet Insurance (www.healthypawspetinsurance.com).
Our plan: See any vet, pays 90% of your vet bill when your pet is sick or injured, covers genetic conditions, and we are actively involved in the animal adoption community. And its affordable.
Please learn more and decide for yourself if we are offering a better plan. I welcome feedback. Thanks.
I am one who never thought pet insurance was worth it. However, after a recent $900+ bill to remove approx 150 porcupine quills from our two dogs, I have wondered if insurance would have helped ease the pain on that bill.
Currently we just set aside money in a savings account for such emergencies, and after reading info about “the fine print” on policies, I feel maybe we are still making a wise choice.
The trick is to choose the right coverage. there is no one size fits all thing here. With more than 30 different plans available in the USA, it’s crucial to choose exactly what you need. For example, if your pet is young and healthy, you may choose a plan with a very low monthly cost (less than $10), which will cover some basic things that you might need. On the other hand, if your pet is in need of a lot of medical attention you can get a more expensive plan with complete coverage which even pays for pre-existing conditions. It’s always possible to get a deal which saves you money but you need to look around and compare.
Once you have the best plan for you, things will go smooth. People I know have saved hundreds per month using pet insurance.
Those with pets are very concerned about the well being of their precious little friends. Many consider a pet so loved that it is just like another member of the family. They will go to great lengths to ensure that their pets health is secured, even if this means spending thousands of dollars on treatment and care. For those in this type of situation, enrolling in pet health insurance is far preferable to suddenly needing to shell out thousands or going into debt.Lets face it, pets do not live as long as humans do, and they are likely to experience some illness or disease at some time in their life. It is a relief to know that treatment options for pets have grown considerably as medical technologies have advanced. But just as these treatments have become more technologically advanced, they have also grown in price.So while treatments and procedures that were once available only to humans, such as MRIs or kidney transplants, are now available for pets, making it possible to further extend their lives, pet owners have also gradually seen an increase in health related costs. This has made health insurance for pets something that is advisable when it was once not quite as important.If your pet acquires something such as lung insurance, this could cost you over $2000. Pets are also often accident prone little beings. Even a broken leg, which many pets will experience, can cost up to $1000, and something such as removing a foreign item from the stomach can also cost over $1000.Pet insurance is similar to health insurance for humans in that it has deductibles, premiums, and co-pays. It is also true that if a pet is well up in age or has been diagnosed with a serious illness, you will have to pay a much higher premium. There are also some conditions that health insurance companies will refuse to cover, and many do not provide insurance for pets over nine years old.While one may have a hard time reconciling the monthly premiums that you will have to pay, consider how much you would pay should your pet actually contract a life threatening illness. If you or some other family members are extremely attached to this animal, you may find that you would end up paying more than you would think. If this is the case, you should prepare now by setting up a security blanket in the form of pet health insurance.Make sure that you understand different health insurance policies and their rates before you choose a policy. Shop around to ensure that you are obtaining the best possible rate for your pet. It is a good idea to get personalized quotes from different companies rather than just looking at a standardized rate on paper. While this is good as a guideline, there may often be exclusions or differences in deductibles or premiums because of your pets particular profile.If mans best friend for you is truly your dog or other pet, it is probably a good idea for you to purchase Pet Health Insurance. In the event of an unfortunate accident or illness, you will be relieved to have this to fall back on.
I’m a firm believer in health insurance and having a savings account for my pets. I recently lost my cat to cancer. The bills for her month long illness amounted to a little over $3,000 but because of health insurance I paid about a third of that.
My dog was diagnosed with cancer in July, 2008 and since then she’s had surgery, chemo, multiple ultrasounds, and many vet visits. The total for her car has amounted to thousands of dollars but I’ve had to pay a fraction of that.
Because I have health insurance for my pets I’m able to focus on what they need and how to help them, rather than worrying about my bank account. I’ve had pets get sick in the past, when I didn’t have health insurance, and it’s a huge difference having the peace of mind knowing I don’t have to base their health decisions on what I can afford.
There is a third option to this question that is the best of the bunch. That option is a Pet Care Savings Program, which is designed to save money on everything for that special family member – Your Pet! All pets in the household can take advantage of these types of programs. The Pet Care Savings program is NOT insurance. The plan provides a 25% discount at network veterinarians on all medical proceedures, plus savings from 10% to 30% on pet products and services at participating merchants. As part of your program you also get Free pet ID tags and a 24 hour location service for lost pets. These types of programs like the one our family swears by costs us only $79.00 for the whole year. Our program has no limit on the number of household pets and covers companion pets as well as exotic animals like birds and reptiles. We have our 2 small dogs enrolled and this year alone we have saved 3 times the amount the plan cost us. This is by far the best bet for our pets. We have saved money on supplies, grooming, food and even boarding when our family had to go out of town for a wedding last March. I would recommend everyone check into such a service.
I personally believe that pet insurance is something that at least everyone should consider. The benefits are getting better each year as the pet insurance companies respond to the market. I have a site where you can learn more, read reviews, learn about companies and also get multiple quotes from major providers.
Thank you for this article. While I would love to just put aside money for Harleigh (my 1 y/o Labrador), I just don’t feel I could get enough money in there to cover an obstruction surgery (my friends Lab just had an obstruction surgery that was $3,000) or ACL/CCL surgery. If I was out of college and had a steady job, then yes, I could see just using a savings account, but since I am still in college and will not be graduating for quite a few years pet insurance seems to be the best option for me.
I’ve narrowed it down to Healthy Paws and Pet Plan, I still haven’t made my decision as I’m trying to read as much about each companies policies, premiums, etc. I had considered VPI, but I was no happy with their policies and the fact that they exclude a LOT of stuff.
Especially with her being so active the chance of an injury happening is much more increased and I think I would feel much more secure knowing that she is “protected”. The main reason I have narrowed it down to those 2 companies is because they both seem to have good records (though Healthy Paws is pretty new) and cover a lot of stuff, including Hip Dysplasia which is a big deal in Labs.
Now I’ve just got to get the ball rolling and actually enroll
I know this is an old post, but just came across it and had to add my two cents. At first, i didn’t think we needed pet insurance. We paid so little for our dog, I thought if something happened and there was an expensive vet bill the decision would be easy. It’s harsh, but that’s how I thought back then. But the little guy really became a part of the family, so to say, and the wife convinced me to get the insurance. I’m glad we did, because every year he has gotten into something that has caused us to need a trip to the emergency room, including one year where surgery was required. $5k, but with insurance we paid just over $1k. I am also a believer in the saving method, but I can easily say we have come out ahead with the insurance, rather than the saving. at the very least, I’ve noticed the insurance basically pays for the standard preventative measures, which, if you take your pet in for regularly recommended appointments, the insurance pays for itself if you have to make just one unscheduled appointment, or worse, an ER visit. We use VPI pet insurance, and have since recommended it to all our friends and family members with pets. I get nothing for saying that, just like the company. They’ve done ok by us.
I’ve had dogs my entire life, from childhood onward. My first dog got hit by a car when I was 6 years old. A group of young neighborhood children were standing in the yard across the street from my house and I came outside with her (not on a leash, I know, but I was 6!). My friend called to her and she bounded across the street – in front of a car. The driver stopped to help and told my mother that he had actually been eyeballing the children, who were standing close to the curb, to be sure none of them moved toward the street so did not see my dog. She was at the vet for nearly a month and my parents never once mentioned the expense. Once she came home, we had her for another 13 years. My second dog lived under a cloud – she was allergic to everything, prone to ear infections, tore her ACL and then got cancer at age 12. Since her breed life expectancy was 13-15 years, I instructed the vet to only provide palliative care as his prognosis was that she only had a couple of weeks left. People challenged my decision, particularly as she lived another year-plus (virtually all of it comfortably and happily), which was very, very pricey. But, it never occurred to me not to have her put down for financial reasons alone because my parents had set that early example for me that I was responsible for her. After she passed, I added up the bills for allergies, ACL and cancer and looked into pet health insurance because I also had a six-year old rescue. As some people have pointed out, the monthly premiums can sometimes total more than the cost of an emergency or chronic illness, and I considered the fact that my rescue had never been sick a day in her life, and is also very well behaved, then decided not to get it. About two weeks ago, she started throwing up repeatedly, would not eat or drink and just lay in bed. It turned out to be an obstruction that had to be removed surgically – and my well-trained dog had eaten a piece of rubber that she’d somehow found and scarfed without my noticing (note to self: no more talking on the phone while walking her!) During the course of all this, the vet found an unrelated tumor and we are currently waiting to learn whether it’s malignant. Now I am back onto the pet health insurance question and thinking that it may be like getting a “balanced billing” electric bill where the company charges you the same amount of money every month based on your prior usage so you don’t get those “price shocks” during severe winters or heat waves. Sigh.
i made my own ‘pet insurance’ by creating an emergency vet fund that i regularly contribute to. i don’t really think traditional pet insurance is worth it as there is a lot of fine print on what they will and will not cover. if anything go for a vet discount plan where you receive a discount upfront on most medical services. i use one called Pet Assure which only costs me about the price of netflix to help with some of the vet costs for my dog. this in combination with my rainy day fund has proven to be much better than having yet another insurance policy.