Is Pet Insurance Worth It? Preparing to Pay For Your Dog's Healthcare

October 04, 2019

Is Pet Insurance Worth it? Preparing to Pay for Your Dog's Healthcare

Within the world of dog owners, there is a rising interest in pet insurance. But is pet insurance worth it? According to Consumer Reports, pet insurance is one of the fastest-growing voluntary employee benefits. One in three Fortune 500 companies offers pet insurance.

But, much like health insurance for humans, navigating pet insurance policies can be tricky. Weighing the pros and cons of enrolling your dog in a pet insurance plan is a tough decision.

So, is pet insurance worth it? Let’s take a look at what pet insurance coverage usually entails, what is typically excluded from coverage, when the best time to enroll your dog is, and alternative ways to save in the event of a health-related emergency with your dog.

What is pet insurance?

Pet insurance is health insurance for your pet. It is an industry that is gaining traction, with over 80% of plans being taken out on dogs. Most pet insurance policies are designed to cover high-cost accident and illness-related bills. The majority of plans do not cover preventative care, pre-existing conditions and other common ailments (more on this below).

Pet insurance works similarly to health insurance for humans. Typically, you pay a monthly premium for your dog’s coverage. The plan will have a deductible, and any qualifying treatments over the monthly, quarterly or yearly deductible will be reimbursed by the insurance company. This is the main difference between human health insurance and pet insurance. For pet insurance, you will need to pay upfront, then file a claim to be reimbursed by the company.

Is pet insurance worth it?

It is estimated that most dog owners will incur at least one $2000+ medical bill in their pet’s lifetime (source). Pet insurance is your financial protection against these types of incidents. Basically, the plan is there to avoid a scenario where you need to choose what’s known as “economic euthanasia”. Wherein you need to put your dog down because you can’t afford the cost of treatment.

A good pet insurance plan will cover things like:

  • Motor-vehicle accidents
  • Major surgeries
  • Cancer treatment
  • Hospitalization
  • Prescriptions
  • Diagnostic treatment

The vast majority of plans do not cover preventative care or routine procedures and treatments, a pet insurance plan is really there for emergencies.

What will my pet insurance probably not cover?

  • Pre-existing conditions
  • Annual checkups
  • Vaccinations
  • Spaying/neutering
  • Dental care

That being said, you can opt for plans that do include ‘wellness’ and ‘puppy packages’.  However, when you look at the numbers, the extra cost you will pay per month for coverage of these visits and care is pretty much a breakeven (or even a little more) than what it would cost to just pay for preventative care out of pocket.

For that reason, if you do decide pet insurance is right for your dog, a more traditional plan—one that’s there for emergencies—is probably a better financial choice.

Is pet insurance right for my dog?

My Siberian Husky was sleeping in the driveway and suffered a severe injury when a car backed into her rear end. She needed reconstructive pelvic surgery and an extended stay at an emergency veterinary hospital. We were so lucky that she made a full recovery, but we paid over $6000 in out of pocket costs.

This was a significant financial hit but for us one we had to take on! I can speak from experience about how awful of a situation it is to be weighing the cost and economic burden over the treatment of your beloved dog.

After this event, when we decided to get a Labrador puppy about 18 months later, there was no doubt in our mind that we would take out a pet insurance policy for him.

Now, as the owner of three large dogs, he is our only dog with a policy. Why? Because of the advantages of locking into a policy when you have a puppy. At this point, your dog has no pre-existing conditions that will increase costs and you can find a policy that will not raise the monthly premium as your dog ages.

And, sadly, the likelihood of your young dog suffering from a major accident or need for expensive treatment during his life span is fairly likely. Having that plan in place and paying a monthly fee is the peace of mind that we will be able to follow through with treatment no matter what the circumstance.

Our other dogs were adopted as adults and had a wealth of ‘pre-existing conditions’ which meant that monthly premiums were far higher.  We know that many of the ailments and coverage they would need wouldn’t be covered because they are linked to their pre-existing conditions.

Choosing a pet insurance policy

What to look for when choosing a pet insurance policy:

  • Free quotes from a variety of insurers for comparison’s sake
  • Sample policies and scenarios
  • Coverage that has percentage based payouts vs. ‘reasonable’ payouts
  • Locked in premiums, or a clear understanding of how premiums will increase
  • A clear understanding of terms and conditions
  • A clear understanding of what’s not covered

Questions to ask when considering a pet insurance plan:

  • What does this pet insurance plan cover? What does it not cover?
  • What is the monthly or annual deductible of this plan?
  • Does this plan cover a flat percentage of costs over the deductible?
  • Does this plan limit coverage to “usual and customary costs” in your area? (this can set you up for a nightmare of arguing and subjectivity on the insurers part)
  • Is there a maximum payout the plan will cover monthly, annual, per ‘event’, per ‘bodily system’ (plans exist with all kinds of limitations)
  • Does my dog have pre-existing conditions? Will this significantly lower the value of the plan because of the likelihood of treatments needed being related to their condition?
  • Does my dog’s breed have a predisposition to diseases and illness? Could this make an insurance plan for him more beneficial? (the answer is (sadly) yes for many purebreds)
  • How old is my dog and what is their life expectancy? Will the annual cost of a plan at this point make sense? or would an emergency fund be a better plan?

Additionally, talk to your vet about the decision! Our vet was extremely helpful in pointing us towards the best plans she has seen, ones to avoid, and how to get the most out of our coverage.

Alternatives to pet insurance

For some families, the idea of paying a premium for the duration of their pet’s life isn’t appealing. Or, maybe you have an older dog with a lot of preexisting conditions and don’t feel that it makes sense to get pet insurance for them at this point (like is the case with my two adopted dogs).

Instead, you can set up your own emergency fund. Create a savings account with an allotment of money specifically for veterinary bills. You can decide on a monthly contribution or auto-deposit to help the fund grow over time.

What do you think? Is pet insurance worth it?

While pet insurance is a growing industry, and one I am personally in support of in the right circumstance, it’s estimated that less than 2% of all dogs in the US have pet insurance. 

Does pet insurance seem worth it to you?  We’d love to hear your thoughts on the matter. Why or why aren’t you going to get pet insurance for your pooch?  Leave a comment below!



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