For many pet owners, pets are family members deserving of the best care—especially when it comes to their health. That’s why many people consider purchasing an insurance policy in the hopes of saving money on their pets’ health care.
According to a survey of pet owners by the American Pet Products Association, pet owners in the United States spent more than $53 billion on their pets in 2012 and more than $13.5 billion on veterinary bills alone. That’s an average yearly vet bill of $231 for a dog owner and $193 for a cat owner, and it doesn’t take into consideration treatment of major illnesses, surgery, or emergency services.
“Pet owners spend millions of dollars each year in treating common ailments that affect their pets, from skin allergies to upset stomachs, arthritis, and diabetes,” says Loretta Worters, vice president of communications for the Insurance Information Institute and Equifax Finance Blog contributor. “Statistics show that 40 percent of all dogs get cancer in their lives.”
Pet insurance costs are based in part on the pet’s age and breed, as well as whether the pet spends a lot of time outdoors, Worters explains. Insurance companies also take previous medical issues into consideration.
Costs typically range from about $20 to $40 per month, depending on deductibles and level of coverage.
A Consumer Reports analysis of plans from major pet insurance providers found that pet insurance isn’t a great deal for people with healthy pets, but for those who have animals with chronic problems or expensive illnesses, pet insurance can be worth the cost.
“Pet health insurance can provide financial protection for medical expenses you never expected or can’t afford,” Worters says.
When you are looking at whether to buy pet insurance:
Be prepared to pay a deductible. Even if you have pet insurance, you’ll still incur costs if your pet is sick or injured. Worters notes that deductibles typically range from $100 up to $500, depending on the plan.
Be sure you know what’s covered in available plans. Consumer Reports suggests getting a policy that’s easy to understand and that spells everything out. That way, if something arises and the insurance is needed, you can be certain of the costs involved. Some plans only cover a certain percentage of charges from your actual vet bill, while others limit payouts per illness or injury.
Know that pre-existing conditions won’t be covered. According to Worters, most pet insurance plans don’t cover costs associated with illnesses or injuries that occurred before the pet insurance policy was purchased.
Ask your veterinarian about a prepaid health plan. These plans, offered directly by some veterinarians, allow you to pay a set dollar amount to cover specific procedures and vaccinations throughout the year. This may be a good alternative to pet insurance for people with pets that are usually healthy.
Consider setting money aside instead. You could also put money in an account with the intention of keeping it in case something happens to your pet—“sort of a self-insurance,” Worters explains. That way, if you don’t end up needing the money for veterinary care, you can use it on something else.
Joslin Woods is a researcher, writer, and Web producer at Think Glink Media, with a background in print and digital media. Previously, Joslin worked as a news reporter for the international news agency Agence France-Presse and as a freelance reporter for the Sun-Times News Group. She is a graduate of Vanderbilt University and Northwestern University, where she received a master’s degree in journalism.