Is Pet Insurance Worth It?

So you adopted a dog (or cat or bird). You’ve got the food, the bed and the toys, and now you’re wondering whether pet insurance is a good investment. What if your new companion gets sick or hurt? Could pet insurance help save their lives — and protect your wallet?

Pet insurance, like its human equivalent, varies from animal to animal. Different animals, breeds and ages are all insured at different rates, and different plans cover different types of care. And what’s actually covered often is not worth the cost.

But for many pet owners, pet insurance provides them with assurance they won’t have to make the impossible choice between a $2,000 operation and saying goodbye to a four-legged (or winged) family member.

Before you buy, you need to know that pet insurance can get pricey, and it comes with a lot of exclusions. Let’s take a look at what pet insurance covers and how much it costs.

What pet insurance does and (does not) cover

Figuring out what pet insurance covers can be as confusing as figuring out your own health insurance matters. The difference is that a lot of the coverage depends on the breed of animal being insured, so you’ll need to research the policy with your animal’s health history — and potential future health needs — in mind.

Below, we’ve highlighted what sorts of treatment most policies do — and don’t — tend to cover, but you’ll want to check the specifics of the one you’re considering to make sure it meets your needs.

What most policies cover

• Diagnostic tests
• Surgeries
• Medications
• Treatment

What most policies don’t cover

• Dental care
• Preexisting or hereditary conditions
• Preventive care visits or wellness checks

These limitations vary from policy to policy, so pay close attention to the terms when you’re researching. The breed- or animal-specific hereditary conditions are sometimes difficult to define, and some companies do cover them if they come up after you’re enrolled, so talk to your vet about potential problems before deciding on an insurance plan.

And if you have an “exotic” animal like a horse, lizard or parrot, you may need to search for specialised insurance companies.

How to pick out the right insurance

In addition to what your plan actually covers, there are a few other factors to consider when picking a pet insurance policy:

• Premium costs
• Waiting periods
• Deductibles and co-pays
• Reimbursement percentages
• Maximum benefit amounts

If this sounds about as complicated as choosing your own health insurance, you’re not wrong. You’ll have to weigh all of these factors against the cost of the care your pet could need and decide if insurance is even worth it.

Pet insurance premiums range from $15 to $100 per month, and policies may cover anywhere from 70% to 90% of your costs or charge thousands of dollars in deductibles before your benefits kick in.

That means that the cheapest plan may not be the best choice if it has a very high deductible or reimburses only a small percentage of every claim. Also keep in mind that many pet insurance companies offer reimbursement only, which means you’ll still be paying your vet bills out of pocket while you negotiate what you’re eligible for.

The biggest issues to watch out for if you’re going to get pet insurance are service related. Not all companies are the same, and many exclude specific treatments or pay different percentages on different procedures, so read the policy as carefully as you would your own. Many also vary your deductible based on the incident type and treatment, which can make planning for an emergency difficult.

Despite what the numbers say, some veterinarians will recommend insurance for animals of every age and size because it offers peace of mind and works as a savings plan for larger bills that may come down the line. Some say they usually send the entire bill to the insurance company because, “you never know what might get covered,” which seems to accent the biggest problem with pet insurance: the unknowable outcomes of claims.

If you’d still like to go for it, compare policies and get prices from at least a few of the larger pet insurance companies. Some home and car insurance providers may offer discounts on select pet plans as well, so be sure to check with them first.

Alternatives to pet insurance

If you don’t like the idea of pet insurance, there are alternatives, but they’ll require a more proactive approach on your part. One option is to start funding an account for your pet’s care — essentially putting those insurance premiums aside anyway in case your animal has a major health issue or unexpected emergency.

To budget accurately, the first thing you’ll need to do is research your pet and see what types of common, hereditary ailments they might run into. Then call your vet and ask for a rough estimate on care costs.

With these in hand, you can create a makeshift hypothetical payment plan. Make sure to include problems like potential broken bones and dental care.

As for the care itself, shop around for the best deals. Costs are going to vary depending on your location, but many larger cities have cheaper, non-profit clinics or universities that are willing to work with you on prices and payments if necessary. These often run a first-come-first-served system, so be prepared to spend a lot of time in the office. Some offices may offer low-cost annual visits and medications, but not handle major chronic maladies.

Some vet clinics even offer subscription care plans that give you access to discounts on services like vaccines and unlimited preventive care visits for a monthly or annual fee.

The benefit of animal insurance is going to come down to your location, the type of pet, and the lifestyle. If your animal roams the streets freely, it’s going to be more prone to accidents, and pet insurance might be worth it. If you’ve got a dog that wants to eat everything he can put in his mouth and chase anything that moves, purchasing a plan might be the right choice. If you’ve got a healthy and active indoor cat, the cost-benefit ratio may make less sense.

Because one thing is certain: If your animal remains healthy and doesn’t have any major medical conditions, the insurance absolutely will not be worth it. Even if your pet does need major surgery — at a cost of, say, $2,000 once in its lifetime — you may still only be breaking even in a best-case scenario.

As with any other insurance, choosing not to purchase coverage for your pet is simply a bet that they won’t need it — or that their care will cost less than your premiums over the years. Pet insurance is geared more toward people who don’t want to set up a separate fund to cover health costs or who want the peace of mind that comes from insurance. If that’s you, all we can say is research your potential plans extensively before choosing one.

This story was originally published in December 2011 and updated on June 14, 2020 by Emily Long. Our updates include the following: plan options, revisions to the first paragraph, changes to reflect current Lifehacker style and a new header image.