We insure our cars, our homes, our lives, our collectibles, our livelihoods and our health. If we own high-end competition animals like race or show horses, we can also insure those animals – but should we insure pets as well?
Pet insurance is now available from traditional insurance companies like Nationwide and GEICO, via agencies like the ASPCA, and from digitally driven upstarts like Lemonade and Healthy Paws.
Buying insurance for a pet may have once sounded like an exotic idea, but it’s become more popular in recent years, to the point that many employees are asking companies to offer pet insurance as part of their benefits package.
To Buy or Not to Buy
It’s a personal choice whether you buy pet insurance or not – you can always hope and pray that nothing will happen to a beloved pet, but you can never really plan for what will happen should they become sick or injured.
You cannot obtain health insurance after-the-fact at a reasonable price for pre-existing conditions—so if you think you’ll need pet insurance it is best to do it as soon as possible before your pet is diagnosed with a chronic illness.
Types of Pet Insurance
There are a few different types of pet insurance. Wellness insurance covers routine veterinary exams. Accident-only plans, just as they sound, cover only accidents. Comprehensive plans cover accidents and illness, generally with the option to add preventative care or wellness coverage.
Wellness insurance is generally an add-on option to other policies, as its name implies, it covers wellness exams and certain types of preventative care tests.
Accident-only coverage will usually cover all or part of the costs for any type of diagnostic test or treatment related to an accident, including radiological studies like x-rays and CT scans, medical supplies like bandages and splints, and medications.
Comprehensive coverage reimburses policyholders for treatments and tests related to accidents and also most illnesses like infections, cancers and non-genetic degenerative diseases. Occasionally these policies will also treat genetic conditions.
We think that wellness coverage is often expensive and not worth the price, but comprehensive coverage can be a good value. In our opinion, the best way to think about pet insurance is as catastrophic coverage for worst-case scenarios, and not for routine care. Routine care is something we should budget for on an annual basis.
Why It’s Worth Buying
We believe that almost every living, breathing thing that is part of your household should have some kind of protection from catastrophes. Do you need to buy a policy for the goldfish you won at the state fair? Maybe not—but if you collect exotic fish? Absolutely.
Think of it as transferring risk for a small fee. Pet insurance can not only help keep your pet healthy, but it can also be lifesaving.
As any long-time pet owner can tell you, veterinary care can become very expensive, and we want to be able to do as much as possible to take care of our furry and feathered family members. Pets now have access to interventions and preventative care that were once unimaginable, enabling them to live longer and healthier lives relatively pain-free. Pet insurance makes it possible to afford these next-generation interventions and specialized care, and may enable our pets to enjoy a better lifestyle.
An actual veterinary invoice can be all the incentive one needs to want to obtain pet insurance—diagnostic exams like ultrasounds, CT scans and MRIs can cost thousands of dollars, and after a diagnosis is made there is the cost of treatment. Some drug regimens, like chemotherapy can run as much as $300 to $500 per dose, which is often administered on a weekly basis. Surgical interventions may also run into the thousands of dollars, as can veterinary emergency care should a pet need immediate attention during evenings or weekends.
Keep in mind also that chronic conditions as well as emergency interventions can lead to the need for long-term care or rehabilitation for our pets, creating a recurring cost that may last the duration of their lives. Ideally, it’s no problem to keep some cash set aside in an emergency fund for our pets, but it may be difficult or inappropriate to cover the cost of ongoing care for a pet out of our emergency funds.
The bottom line is that it is wise to obtain coverage, especially if you have multiple pets.
Take Magdalena Delega’s experience as an example:
“I had an English Bulldog who developed what looked like bee sting bites all over his body. Luckily, I had pet insurance and was able to take him to the animal hospital and have him looked over by the doctor and diagnose him. The claim was $1,500 of which the insurance paid $1,250.”
What You Need to Know About Pet Insurance Policies
Pet insurance policies are offered by approximately twenty companies in the U.S. They usually have a deductible component and a coinsurance component, and you can usually choose different levels of each—a higher deductible and lower coinsurance would mean lower monthly or annual premiums.
So a policy with a $500 annual deductible with $90% coinsurance would require you to go through $500 out of pocket before the insurance company kicks in 90% of the remaining balance. The premium is the price you pay for an insurance policy.
Many pet insurance policies will put a total dollar-amount limit on how much they’ll pay, but some policies do not have a limit or cap on what they will pay. We would advise choosing an insurance policy that does not limit how much they will pay—otherwise, what’s the point of the insurance?
Pet insurance policy premiums typically increase annually as a pet ages.
It pays to shop around and look at the various providers to compare features, benefits costs and limitations. A good place to start are third-party, consumer-oriented sites that track up-to-date information about insurance policies.
To determine if pet insurance is worth it, ask if paying about $20 per month is worth not having to worry if your cute little pet needs a $10,000 procedure—that’s $240 per year to sleep well at night.
When it comes to your pet, they’re part of your family. Anything that can be done to reduce or eliminate the possibility that finances take precedence over what your heart is wanting to do, is priceless if ever in that situation. Unfortunately, many do not realize just how expensive pet care can be.
Every individual situation is unique and you will have to determine what makes the most sense for you—you could never need that pet insurance, but find the peace of mind that owning coverage brings worth the price anyway. No one wants to be faced with the choice of either paying thousands or tens of thousands of dollars for a procedure or course of treatment, or putting a beloved pet down.
The most unfortunate among us don’t have the luxury of having a say in the matter, because they couldn’t afford the sudden expense of a costly surgery—but pet insurance can help take that burden away for an affordable monthly or yearly premium.
Article contributors include Garret Desjardins, Christopher Vassallo, Kevin Cremi, Jeff Weiand, and Magdalena Delega.