Pet health insurance is a new concept for most U.S. pet owners, but as veterinary bills rise along with inflation, such a policy could provide valuable peace of mind and financial protection. The pet health insurance market has grown rapidly in recent years, and coverage has improved from what was offered by only a few providers decades ago. However, some pet owners may feel insurance is an unnecessary expense. The Caring Hands Animal Hospital team shares our insights on the pros and cons of pet insurance so you can decide if an insurance policy is right for you and your furry pal.

Pet insurance basics

To decide if you need pet insurance, you should first understand how it works. Pet health insurance is not truly health insurance at all. Instead, it works more like property coverage. You can choose any veterinarian you want because you will pay for services directly and then file a claim for reimbursement with the insurance company later. All policies have waiting periods before coverage begins, and you can typically choose your deductible, annual maximum coverage limit, and reimbursement percentage, which helps to keep premium costs affordable.

Most policies offer comprehensive accident and illness coverage, which reimburses you for the costs of diagnostic tests, medications, surgeries, and procedures when your pet gets sick. Standard policies don’t cover routine wellness care costs unless the company offers this for an extra monthly fee. You can also purchase accident-only plans to keep costs lower.

Pet insurance pros

The benefits of having a pet insurance policy in place include:

  • Financial security — Major veterinary bills are often unexpected. Pet insurance prevents you from going into debt when you aren’t prepared to do so or worse, choosing economic euthanasia for your pet because you can’t afford the cost of treatment.
  • Advanced treatments — With insurance, you can choose your pet’s treatment based on what’s best for them medically, not what your wallet will allow.
  • Peace of mind — Insurance can reduce pet owner anxiety about the future of their pet’s health and ongoing care.

Pet insurance cons

The downsides of pet insurance include:

  • Monthly costs — The average pet insurance policy costs between $30 and $50 per month but may be higher if you have a purebred or senior pet. Some years you will pay into the policy without filing any claims.
  • Exclusions and limitations — Most plans have a lengthy list of exclusions and condition-specific waiting periods, or only cover certain services for an extra cost. Examples of common exclusions include routine care, examination fees, herbs and supplements, and advanced dental treatments.
  • Premium increases — As your pet reaches their senior years, the likelihood of filing claims goes up and your premiums will increase.

Should you purchase a pet health insurance policy?

Most pets will experience a major illness, accident, emergency, chronic disease, or other costly issue at some point during their lives. Although some years you may pay into your policy and get nothing out of it, you will likely save hundreds to thousands of dollars when you do eventually file a large claim. The key to getting good value from your plan is doing your research and choosing a reputable company with plans that meet your pet’s potential future medical needs and your family’s budget.

Consider the following when you are shopping for plans:

  • Coverage — Every plan is different in what it includes and excludes. Think about your pet’s age, common problems in their breed, problems you’ve encountered with previous pets, and the type of treatments you prefer.
  • Your budget — Would you rather pay a higher monthly premium and pay little out of pocket for care, or pay low monthly premiums and pay more when you need to use your plan?
  • Company reviews and reputation — Choosing a reputable company is vital to your happiness with your plan. Read reviews on multiple sites or use social media to connect with current customers about the company.

Financial alternatives to pet insurance

If you aren’t sure about pet insurance or don’t want to deal with the hassles of filing claims and being subject to your policy’s parameters, you can consider other ways to prepare for veterinary bills, including:

  • Pet emergency fund — Instead of paying into insurance each month, set aside money in a pet emergency fund. The drawbacks are that it will take time to build up enough funds to cover a major incident and you will have to start over to replenish those funds if you need to use them.
  • Pet credit card — Third-party financing or a low-interest credit card designed for pet care can help spread out unexpected costs.
  • Wellness packages — Wellness packages, such as our kitten and puppy packages, allow you to spread out costs and get discounts on routine care.

The decision to purchase pet insurance is a personal one, and we encourage you to thoroughly research your options before choosing a plan. Having pet insurance can ensure your pet gets the care they need when they get sick or injured without derailing your finances, but starting a pet savings fund may be a viable alternative. When your pet needs care, contact our Caring Hands Animal Hospital team to schedule a visit.