Is Pet Insurance Worth It?

By Becky Turner

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Is pet insurance worth it?

Is pet insurance worth it? This is a question I've been mulling over ever since I added up all the vet bills during the first year of having our Sheltie puppies Howard and Piper. For instance, so far we've paid the vet:

• $130 on vaccinations
• $180 on appointment fees
• $400 on neutering

This adds up to $710 for two Shelties to have their basic vaccinations, annual check-ups, desexing, plus a visit for Howard when he had a bacterial infection from a scratch.

With an average monthly pet insurance premium of $15 (adding up to $180 per year) it appears at face value that pet insurance is worth it. But let's dig a littler deeper...

For a start, the most expensive vet bill was neutering two dogs and that is a one-time thing. In this article I have looked realistically at the vet visits over a lifetime, what treatments are actually covered, and the fine print which stipulates important issues like payment caps and co-pay limitations.

What is Pet Insurance - Really?

Realistically, pet insurance is a form of enforced savings - that almost never covers the entire vet bill. Consumer Reports points out that you can achieve the same thing by paying the same monthly premium into your own savings account.

The upshot is that if your Sheltie never gets seriously injured or diseased, the savings will belong to you. This can range from $2,000 to $9,000 over your dog's lifetime (where monthly insurance premiums range from $11 to $50). Thankfully, the odds are stacked in your favor too. Many well-bred dogs live long, healthy lives without complications, so the biggest vet bill you will ever shell out for is desexing.

Of course, the downside is that if your Sheltie ever does need expensive medical treatment, you will need to spend those savings. So the question - is pet insurance worth it - really comes down to the chances of your dog developing serious ailments, paired with the cost of premiums and how much the insurance will cover.

Lucky The Labrador Retriever

To assess this, let's look at the example set out on the Consumer Reports website. They created Lucky, a fictional purebred Labrador Retriever, and gave him a list of common ailments over his lifetime. Then they calculated some pet insurance comparisons and the overall cost of treating Lucky with and without insurance.

What does Lucky teach us? If your dog requires an expensive treatment, pet insurance is sometimes worth it. By paying the most expensive premium (Pet Care QuickCare Gold Double Benefits) you could save as much as $2,620.

However, bear in mind that a lot of people will pay those expensive premiums for years and never need to make a large claim. In this example, the worst case scenario means spending $2,620 unnecessarily, while the best case scenario means saving $3,380 - and is technically more likely too.

Read The Fine Print

If you have a dog who is prone to ailments, or you decide to buy pet insurance in order to help protect yourself from large vet bills, just make sure you read the fine print. Pay special attention to the following factors:

• Lifelong Pet Insurance - like humans, dogs face more health complications as they get older. To protect their profits, most pet insurers won't cover pets over 9 years old (and if they do, the premiums are very high). So try to lock in the cheaper 'young dog' premium - or your provider will just hike it up as your Sheltie gets older.
  
  

• Reading the fine print could save you a ton of cash

  Deductibles - All pet insurance plans have deductibles (also called an excess) which is a minimum amount you have to pay the vet before the insurance company will pay out anything. Choosing a sliding deductible from zero to $1,000 means you can cut the cost of vet bills right down - but this will jack your premiums up.
  
  
• Co-pay - As well as deductibles, your insurance company may insist that you pay 10-20% of the vet bill. For most, co-pay prevents pet insurance being worthwhile.
  
  
• Payment Caps - A cap is the maximum amount your pet insurance provider will pay out - per condition, per year, and per lifetime. Again, this covers their profits, so even if your Sheltie has one or more serious conditions, they will only pay so much to help. Even the most expensive insurance providers can impose payment caps.
  
  
• Claim Delay - Be aware that even if you have comprehensive pet insurance, you will still have to pay the vet yourself at the time of treatment. You then fill out an insurance claim and mail it to your provider, who calculates your entitlement and reimburses part of the bill usually within 2 to 4 weeks.
  
  
• Fine Print - Always read the fine print of a pet insurance policy. There will be a host of rules set out regarding what treatments are covered, when the policy goes into effect, whether prescriptions are covered, and whether emergency treatment is covered. To ensure you get the best pet insurance for a Sheltie, make sure you compare policies and choose wisely depending on your circumstances.
  
  

Pet Insurance Discounts

Having looked at all the factors, I'm not convinced that pet insurance is worth it for our situation with two young and healthy Shelties. However, I respect the fact that other people will come to different conclusions based on their circumstances. So I have listed a couple of major pet insurance providers who offer online discounts - this is a good place to get a free online quote and start your pet policy comparisons.

Embrace Pet Insurance (USA) - Get a 5% discount with Embrace Pet Insurance if your dog is desexed or microchipped, or if you have multiple dogs, or if you pay your premiums annually. Embrace covers up to 90% of your vet bills, and you can use any veterinary hospital in the country. Embrace is rated 9 out of 10 in customer service and you can get a free online quote today.

Aviva Pet Insurance (UK) - Get a 10% online discount with Britain's largest pet insurance provider. Aviva offers insurance for dogs from 8 weeks onwards, covering up to £6,500 per year (Platinum cover) and up to £1,000 boarding kennel fees if you have to go into hospital for 48 hours or longer. Aviva is a major insurance brand with a solid reputation. Get a free online quote today.